Start Your Business With An MVP
Mistaken assumptions put many business ideas into premature coffins. That is to say, businesses set themselves up for failure by embracing assumptions that run counter to lean principles that there’s a market for their services. To have a clear picture of your value proposition, test the appeal of that value with a minimum viable product (MVP).
A value proposition tells prospects why they should do business with you rather than your competitors. It also imparts a clear picture of the benefits of your products or services.
Value proposition focuses on one essential question: What problem does your business solve? Of course, even a seemingly rock-solid value proposition needs to be vetted in the most cost- and time-efficient manner possible.
An MVP is a product or service with sufficient function and features that can be offered to customers. An MVP that’s usable enough lets you observe customers’ actual behavior with the product or service. That takes your audience research a step beyond mere opinions. Since these are the early adopters, they’ll provide ongoing feedback as you iterate through the design phase.
The idea is to offer users a firsthand level of experience with what you hope to sell them on a larger scale later on. In effect, you’re testing a hypothesis. Interact with your users, see how they are using it, and iterate.
Your initial product may suck. A famous mantra is that if you are not embarrassed by your MVP, you started too late. For instance, the founders of Airbnb used their own apartment to test out the idea of peer-to-peer rentals. The first Airbnb did not even have a map feature or payment options. Of course, there are some industries where an MVP won’t work, like biotech, banking, insurance, or any heavily-regulated industry.
Some of the valuable pieces of information, questions, and insight an MVP can offer include:
● Are the people receptive to your idea early adopters, or does your idea appeal to a broader audience? Popularity limited to early adopters can be encouraging but also misleading about long-term appeal.
● How educated is your audience? Do they understand and appreciate your product or service or do they need to be better informed? This can not only suggest how viable your idea is overall, but also how soon it’s prudent to offer a more completely developed product. Don’t try to address all needs on the first iteration. If extensive education is necessary, a quick rollout may prove a disaster. Selling something that has potential but little precedent always takes more time and money than you think it’s going to—as opposed to just starting, say, an ice cream shop.
● Are any of your assumptions reflected in customers’ experiences? For instance, did you expect price to be the major appeal of an urgent care clinic when, in fact, your audience values convenience more?
● Does your target audience want something more or different from your idea? Is there room for their desired evolution in your current product or service? Are you establishing relationships with a target audience that will last?
A solid MVP allows you to test the hypothesis behind your business before committing significant time and resources. The goal is to get something out quickly with enough functionality to attract enough users so you can learn from them.