Minimum Viable Product (MVP) – Definition, Meaning and Examples
Understanding the concept of Minimum Viable Products (MVPs) for business and software development
Minimum Viable Product (MVP) is a term you often hear, but what does it mean? This article defines MVPs, their purpose in the business and software world and provides examples.
If you’re a business owner, then you’ve probably heard of the term “Minimum Viable Product” or short “MVP”. But what is it, and how can you use it to benefit your business? In this article, I will explain what MVP is, what it isn’t and how to create one for your own business. I will also provide some examples of well-known companies that have used MVPs to great effect.
What is a Minimum Viable Product (MVP)?
Minimum viable product (MVP) is a term used in business and software development. It describes a product with the minimum features necessary to satisfy early customers. The goal of MVP is to get feedback from customers as quickly as possible so that the product can be improved based on their feedback.
MVP is not a finished product. It is a prototype or early version of a product that can be released to customers for feedback. It includes just enough features to satisfy early customers and does not include all the features that the final product will have.
MVP is popular in the field of agile development, which is a software development methodology that emphasizes customer feedback and rapid prototyping. Agile development teams use MVP to quickly get feedback from customers and then use that feedback to improve the product.
Businesses can use MVP to test new products or services, or to improve existing products or services. MVP allows businesses to get feedback from customers early and often, which can help them make better decisions about their products and improve their products based on customer feedback.
3 Advantages of Minimum Viable Products (MVPs)
There are many advantages of creating a Minimum Viable Product (MVP), but MVPs are usually created for one or more of these three main reasons:
1. Releasing a product early to market can help you get feedback from customers quickly and improve the product based on that feedback.
2. Testing an idea fast can help you determine if there is a product/market fit. This is important, because if there is not a product/market fit, then it’s better to know from early on and pivot or change direction.
3. Learning what further developments are needed can help you focus your efforts and improve your product. MVP allows you to get feedback from customers about what they want and need, so you can make better decisions about your products or services.
The 3 steps of MVP prototyping
The 3 stages of MVP prototyping are Build, Measure and Learn. In the “Build” stage, you create a prototype of your product. In the “Measure” stage, you test your prototype with customers to get feedback. And in the “Learn” stage, you use that feedback to improve your product and then repeat the cycle as needed.
The build phase is important because it’s during this phase that you create a prototype of your product. The goal of the build phase is to be fast and to include only the necessary features to support your strategy. You want to create a prototype that can be tested with customers quickly, so you can get feedback and improve the product based on that feedback. To do this, you need to focus on creating ONLY an MVP, which is a product with the minimum features necessary to satisfy early customers.
In the measure stage, you test your prototype with customers to get feedback. This stage is important because it’s during this stage that you can determine if there is a product/market fit. If there is not a product/market fit, then you need to react. You also learn what further developments are needed based on customer feedback.
To measure the outcomes of your prototype, you need to ask customers for feedback or analyze gathered data (e.g., clicks, user-flows, engagement). This feedback can help you determine things like customer satisfaction, user engagement and more. You can also use this feedback to improve your product based on what customers want and need.
The learn stage is where you use the feedback from customers to improve your product. This stage is important because it allows you to focus your efforts on the things that matter most to customers. To do this, you need to understand what customers want and need from your product. You can then use this information to make better decisions about your products.
The goal of MVP is to get feedback from customers as quickly as possible, so that the product can be improved based on their feedback. Learning what further developments are needed can help you focus your efforts and improve your product.
How to define the goals of an MVP?
When creating a minimum viable product, it’s important to define the goals of MVP based on your business goals and your business model. The goals of MVP can vary depending on the business, but some common goals include customer acquisition, retention, and the use of the new services.
Defining the goals of MVP is important because it helps you focus your efforts and create a product that meets the needs of your customers. When you know what you’re trying to achieve with MVP, you can create a product that’s more likely to succeed.
How Do You Choose the Right Features for MVP?
Once you’ve defined the goals of MVP, you need to choose the right features for your product. This can be difficult because you want to include enough features to satisfy early customers, but you don’t want to include too many features and confuse or overwhelm customers.
The best way to choose the right features for MVP is to focus on the needs of your customers. Using customer personas can also help identify these specific needs.
Some example questions about your customer’s needs:
- What are they looking for in a product?
- What are their biggest pain points?
- What do they need or want that isn’t currently available?
Also, keep your own goals in mind when creating an MVP
- What are you trying to achieve with this product?
- What needs does this product address?
Focusing on these questions will help you choose the right features for your minimum viable product.
Common Mistakes when creating Minimum Viable Products (MVPs)
When creating a minimum viable product, it’s important to focus on the goals of MVP and not get sidetracked by features that don’t support those goals. It’s also important to remember that MVP is not a finished product. It’s a prototype or early version of a product that can be released to customers for feedback and not for “production”.
Another common mistake is thinking that the product can be the final product. MVP is meant to be a prototype or early version of a product, so it’s important to remember that more development is needed before the product is finalized.
Another common mistake is underestimating the budget for MVP. It’s important to remember that creating a minimum viable product takes time and resources, so make sure you have enough budget allocated to make sure the project can be completed successfully. We found that for most projects, an MVP budget should range between 30k-60k EUR.
Finally, another common mistake is releasing too many features in MVP. This can overwhelm customers and confuse them about what the product is supposed to do. Focusing on the goals of MVP and choosing the right features will help avoid this mistake.
Examples of Minimum Viable Products (MVPs)
Airbnb is a good example of how to create an MVP. When they first started, they created a website that allowed people to list their properties for rent. They quickly realized that this was not the right product and pivoted to their current model, which allows people to book rooms or apartments.
Google is a prime example of a company that used an MVP to great effect. When they first started out, they released a product called “BackRub” which was a search engine that used links between websites to rank their importance. While this was a very innovative product, it was far from perfect. To improve it and make it more user-friendly, they used feedback from their users to create an MVP called “Google”. This new version was much more user-friendly, and it quickly became the most popular search engine on the internet.
Apple has used MVPs extensively in its product development process. For example, the company used an MVP for the first version of the iPhone. This version of the iPhone was much more basic than the final product, but it gave Apple a chance to test the feasibility of its concept and get feedback from users.
Final thoughts about MVPs
Minimum viable product (MVP) is a strategy that was used mainly in product development, but now made it also into the regular business world. It is a prototype or early version of a product or service that can be released to customers for feedback. The goal of an MVP should always be to validate the strategic goals of the product or service, and not get sidetracked by features that don’t support those goals.
It is important to remember that MVP is not a finished product and more development is needed before the product is finalized. Only this way it is possible to be fast, test fast and also learn from this journey. It is also helpful to speak with professionals and experienced people if the first MVP is planned in order not to make common mistakes.
Author: Dr. Andreas Maier, CEO CodeCoda & SIX ERP