The Power of Minimum Viable Products(MVP’s) – Info Entrepreneurship

If you’ve worked at an early-stage tech company or spent time with product management colleagues, you’ve undoubtedly heard the term “MVP” — and not just in reference to talented basketball players like Stephen Curry, Kevin Durant or LeBron James.

No, the MVP I’m talking about is something altogether different — but with just as much impact on a team’s success. MVP is short for Minimum Viable Product, although some have modified it to say Minimum Buyable Product (MBP), for reasons I’ll explain.

What Is an MVP?

A minimum viable product (MVP) is an early version of a product, such as a SaaS (software as a service) application, that is designed to ensure that product vision and strategy are aligned with market needs.

Typically, an MVP delivers just enough functionality and value to appeal to early adopters and other innovators. It’s not a beta version of your product, designed for shaking out bugs or for fine-tuning features and interface elements. It’s also not an idea that exists only on paper (or slides), or a raw demonstration of a proof-of-concept.

Instead, the term “MVP” suggests something very specific:

• Minimum: the smallest number of capabilities, features and packaging that …
• Viable: deliver enough value that customers are willing to spend money (or another currency such as personal information) …
• Product: on something they can use today … not just invest in a future concept, promise or offer.

The goals of an MVP are to validate the premise of a product, to test hypotheses about market needs, to make adjustments to the product vision, and to prioritize where to invest in future development. As such, MVPs are a profoundly powerful approach towards finding product-market fit.

By testing and refining core premises with real-world validation, MVPs help product teams accelerate their decision making and maximize agility. When done correctly, MVPs mitigate the risk of spending time and money developing a product only to find no one has any interest in it when it’s released.

What’s the End Goal?

The MVP concept isn’t a new one. It was coined 15 years ago by tech business management consultant Frank Robinson to help companies maximize return and minimize risk when developing new products. The term really took off when entrepreneurial gurus like Steve Blank and Eric Ries, author of “The Lean Startup,” applied their own insight and began evangelizing it.

The whole MVP-versus-MBP argument boils down to two competing definitions you’ll find floating around out there:

• It’s the smallest product you can build that completes the build/measure/learn loop.
• It’s the smallest product you can build that provides customer value and gets you paid for delivering it.

The difference between these two? I suppose it’s in the eye of the beholder (or the speaker). Are you trying to find what’s saleable, or are you running an iterative experiment for the sake of better understanding your customer? If you’re doing it right, you’re probably doing some of each.

If You Build it, They Will Buy — Right?

I’m not a stickler for which label someone prefers to use, but there’s a pretty solid reason to use the MBP label, as Rohit Sharma reminds us: it’s still a product you’re aiming to sell, where its overall appeal, target audience, features, scalability, costs and other mercenary factors have to be part of your product formulation.

Unless you’re operating a not-for-profit organization, you’re probably out to make money. So the product must be buyable, or at least steer the user toward purchase via embedded growth surfaces such as notifications and email.

But no growth hacker worth her or his salt will overlook the opportunity to capture actual, empirical data about user behavior. Let’s be clear about the nature of an MVP: it’s based on insights about actual demand as a means to reduce the risks of development and to validate ideas before they’re completely set in stone. Although an MVP begins with a core premise that underlies the product’s subsequent iterations, it’s a vision that’s refined with user feedback and market research.

For a growth marketer, there’s no better opportunity than an MVP to create lasting leverage. The small changes you make can have outsized impact, versus what’s possible with a more developed and inflexible product. That’s just one of the many good reasons for using this approach to bringing a product to market:

• It lets you test a product hypothesis while employing minimal resources and engineering.
• It accelerates learning — about product, market and users.
• It gets the product into the hands of customers ASAP.
• It identifies early adopters you can convert into product evangelists.
• It sets a cornerstone for upgrades, expansions, or even other products.
• It lets you test pricing models.
• It builds your reputation.
• It drives revenue (sooner rather than later).

Know Thy Try-er (and Potential Buyer)

Steve Blank notably said,”You’re selling the vision and delivering the minimum feature set to visionaries, not everyone.”

Your MVP is going to be aimed at early adopters, even bleeding-edge adopters. They’ll willing to use a product that delivers value today despite its rough edges, and are more than willing to work with you to make it better, too. That’s because they’re firm believers in the power of “vision.”

That, though, creates a special contract between you and them. As you’re designing and developing your product, therefore, keep the classic ground rules in mind for attracting first-gen users and keeping them happy:

• Your MVP’s value and unique selling proposition is easy to understand, one you can sum up in a plain, short and convincing product point-of-difference/benefit statement.
• It delivers meaningful functionality and value, so customers feel they’re getting an actual, useful product — as spare as its feature set may be — and their money’s worth, even if they never upgrade. It absolutely, unconditionally should never be just a beta or vaporware.
• It’s effortless to try, either because the product is intrinsically simple to use or because you’ve built a frictionless demo.
• It’s simple to buy, with simple pricing and clear payment mechanisms to the customer.
• It’s easy (and alluring) to upgrade, with relevant growth surfaces baked into the product.
• It fulfills the practical and emotional needs of early adopters. You can spin some evangelist gold and long-term loyalty by understanding and acknowledging the value of that investment.

A Few Examples of MVP Success

Successful examples are easy to pluck from startup and software history. In almost every case, they started lean, but had an immediate goal of monetizing their offering:

• Groupon was a spinoff of The Point, a group activism site that didn’t grab much traction, so somebody thought of offering a platform for group-buying deals instead. Groupon was launched as a WordPress blog, hosted on a subdomain (helping them save money), and used daily posts to relate each new offer. If you signed up for any of them, you received a PDF coupon. It’s about as low-fi a rollout as you can imagine, but it still aimed at generating revenue from Day One.
• Zappos got started way back in 1999, and who thought you’d buy shoes online? But it didn’t evaporate with the rest of the dot.com bubble, probably because of the early simplicity of its approach. Nick Swinmurn set up a website that looked polished and credible (in what’s called, for obvious reasons, a “Wizard of Oz” MBP technique), went to shoe stores and took pictures of footwear, posted them, then went back to the stores to buy the shoes his customers ordered. Not the least bit efficient or profitable, but a solid a proof of concept: yes, people would buy shoes online.
• Airbnb is another classic example: In 2007, Brian Chesky and Joe Gebbia couldn’t afford the rent of their San Francisco apartment but wanted to launch a business, so posted pictures of their loft in advance of a conference that was coming to down and got three bookings — plus concept validation and key learnings about what people really wanted.
• Unsplash is a photography website designed to compete with more expensive stock photo sites. Its founders set up a free Tumblr blog using a $19 design theme, then stocked it with 10 high-res images from a local photographer. How long did the build take? Three hours. When they submitted the site to Hacker News, a hangout for designers, developers and entrepreneurs, they got over 20,000 downloads in just a few hours. Today, they see 2 million downloads a month.
• Kickstarter is a cornucopia of MVP concepts, of course. The site itself began as an idea Perry Chen worked up in 2006, though it would take several years to launch. Now you can roam through thousands of budding product ideas there, from the whimsically creative to the seriously scientific. The model Kickstarter pioneered has spread far and wide, with ecommerce sites like Betabrand being built around crowdsourcing of everything from product design to seed funding and sales.

Why Email Is an MVP’s MVP

In nearly every case of a successful MVP, email turned out to be — wait for it — the Most Valuable Player among growth marketing tactics, as we’ve touched on before. Why?

• They’re personal, both in the sense of personalization to the user and in how they’re part of an “intimate,” 1:1 place of engagement: the email inbox. When you’re onboarding early adopters or trying to drive evangelism, this is a huge advantage.
• They’re behavioral, and can be triggered by user actions, making them even more personalized and responsive to users’ real-time needs.
• They’re inherently lean and cost-effective, so your marketing dollar goes much further than it would in other channels or on other platforms.
• They’re agile and adaptable, able to swiftly and flexibly respond to market imperatives and customer preferences.
• They’re easily testable, allowing you to use A/B testing to evaluate copy, timing, offers, pricing or nearly any engagement driver in your sales/marketing mix. Plus, you can measure them against any number of target segments. What call to actions are specific segments clicking on within a newsletter, for example, or are most-forwarded? What notifications get the quickest response?
• They’ll drive product insights, since you can use them to glean how people respond to a product’s various growth surfaces. An upgrade or partner product notification may get an enthusiastic reaction, or fall flat.

A few best practices for using email and notifications to drive MBP-based growth:

• Capture email addresses from the very start. If you’ve got a digital footprint of any kind, you should be exploiting it to collect email addys, even if you haven’t yet got a plan in place for using them. Whether it’s by offering free downloads, unlocks, upgrades or some other premium, do something to grab those addresses. Don’t have your site up yet? A “Coming Soon!” page will do the trick.
• Email users ASAP. Don’t wait to engage. Show your gratitude and interest by sending new users an immediate welcome, and a series of onboarding messages you can use to expand the value promise you’re making and, in the process, capture valuable data based on their responses.
• Solicit feedback, since early adopters will have useful insights about your product, and are also more likely to offer it. Showing you care about their POV also helps head off disgruntlement: if you’re not showing interest in your user base, it’s one more thing they may want to complain about in their next Reddit flyby.
• Keep messages relevant, so users don’t feel they’re being subjected to too many emails or notifications that lack value.
• Give them control through an email and/or notifications control panel where they’ll be empowered to adjust the range and frequency of messages. It’s not just a nice (and expected) gesture, it’s a trove of invaluable insight.
• Test and analyze, everything from doing A/B copy tests to gauging response and unsubscribe rates to any other action or reaction you’re able to observe.

MVPs are, by any definition, powerful offerings for testing product ideas and firing up early adopter engagement and support. To make an MVP a success, though, leverage the depth of engagement and wealth of insight you can gain by making email an integral part of your marketing mix. It’s a key tool for convincing users your product isn’t just viable, but very, very buyable.