MVP: How to use this concept to validate an idea and grow with market feedback

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So you had a great idea and want to take, right?

One of the best known methodologies for the development of products and services is the Minimum Viable Product, created in the cradle of entrepreneurship and exposed by the concept of lean startup .

The idea is simple: to validate the potential of an idea before investing a lot of money in it.

However the implementation of this concept may be the main challenge for the creators of products and services. This is perfectly understandable: cast the first stone who never wowed with a good idea and wanted to throw it in the best possible way!

Conceptually, an MVP (Minimum Viable Product) is to build the simplest version and lean of a product (or part thereof), using minimal resources (time and money) possible to deliver the main proposal of the idea value.

The purpose of this post is to show why and how to implement the concept of Minimum Viable Product in your company (or even in your life / project) and some practical tips for you to maximize your resources.

Why should you consider the concept of MVP?

MVP - Minimum Viable Product

The MVP of origin meets the concept Lean, widely used by business giants like Apple and Facebook in their growth climbing. The central idea is to optimize the use of resources to ensure the maximization of return. The MVP fits in this context as a method to validate the return of a particular investment even before the product is completely finished.

The tactic is to basically use creativity and thinking to create a simplified version of what you plan to market and test the responsiveness of your product in the market. From the feedback received, you must develop your assumptions about how your idea meets that demand.

The Growth Hacking is a methodology that relies much on this concept. The experiments equivalent to MVPs and are implemented (which is the actual investment) only when we know that the result is positive. Often even we tested several versions of MVP before adopting the real solution.

To learn more, check out our eBook Growth Hacking: The Definitive Guide from theory to practice

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Imagine a business model for a food truck for Mexican food. With the whole idea on paper, we have two options to start the business:

  1. Invest in developing the best possible truck, personalized and allows warm deliver the best burritos in every corner of the city;
  2. Investing only in the development of the main product (your burrito recipe), fill up your car trunk door with them and try to sell in some parts of the city.

Note that the main food truck value proposition is present in MVP: burrito offer where you want (or where demand is).

For any enterprise, we can have good or bad results and in different proportions. Considering the three scenarios below as possible, let’s see what happens in each one of them when we implemented the MVP or the final product:

 

In the business world it is rare to hit the target on the first try and put all your resources on a hunch is quite risky.

In the case of Mexican food truck, the concept of MVP validated the idea really had potential through real market feedback. The use of the concept has the ratio return on investment in a food truck burritos much more conscious, structured and predictable.

3 simple steps to create and improve their MVPs

  1. Set the value proposition
  2. Test the response of merchand
  3. Iterate

First step: define what is the value proposition

All business model begins with the assumption that certain value proposition will attract the market’s attention and generate revenue point of profit. In other words, the value proposition is the main output of your product or service to the user.

Aspects that make this even more attractive offer or complement the product are seen as secondary right now.

Think what is the value proposition of your business. The image below is a great example of how to do this:

 

Second step: test the market response

After developing an MVP that includes the value proposition, it is time to understand the market interest in the product to justify the investment.

There are many ways to validate the idea. One is doing an alpha test, which is to launch the product or service to a controlled audience. Already in beta testing, it is reported the MVP for the general public.

In the case of food truck, did the tests in places where we intended to sell to the truck, that is, we conducted a general release.

Warning: the controlled releases are best suited for solutions that may present unexpected problems if there is a lot of demand. This is the case of the software market.

In this step, we need to do two things masterfully:

  1. Understand the receptivity level of the public to its value proposition
  2. Learn what are the main points of improvement that can / should be considered to increase the results

Step Three: Iteration

After the MVP test, it is time to interpret the feedback received.

Not everything you say makes real sense for their business model, yet the market is the best way to test your business model.

Before you make the investment, consider whether your hypothesis needs more testing and prioritize what really makes sense to build value of your proposal.

If your perception is positive, proceed towards the final product. Otherwise, use their learning to formulate a new hypothesis and align their value proposition to market aspirations.

5 tips for creating a MVP

  1. Focus on the central value proposition and the creation of the hypothesis. It is she who will dictate, in fact, the level of demand of your solution.
  2. Do benchmarking to find shortcuts. Learning from the mistakes of others is always cheaper and saves a lot of development time.
  3. Before testing any MVP, know what is a good or bad result and how to measure it. If you can not, rethink how to validate traction in the market.
  4. Apply your MVP to a realistic context. Use your friends and family as market representations often drastically skew the data and can motivate wrong decisions.
  5. It is always interesting to create metrics for your business . They provide the lessons necessary for you to replicate successes and avoid mistakes.

To finish

The concept of MVP was born in the context of startups, especially technology, but the line of reasoning is applicable to virtually all projects.

You can put this methodology into practice from construction companies to build relationships and your investment in the consumer feedback.

The difficulty is knowing how to eliminate aspects that often want to do, but have not yet proved to have functionality and return.

In addition to MVP, the Digital Marketing is a good strategy to be used in business development. To learn more about it, check out our eBook Digital Marketing for Entrepreneurs , also available in audio.