Starting our startup, we dream, if not about the status of a unicorn, then at least about entering active mass sales. And here, a working MVP comes to the team’s aid. It no longer means a primitive development version, but has the most necessary functionality and performs the main task as best as possible.
MVP helps minimize risks. Any startup is based on a certain hypothesis. It helps to check its capacity:
- drawing up a list of criteria that determine its viability;
- creation and launch of MVP;
- measurement of performance indicators;
- analysis of results, concluding, and, if necessary, deciding to test the next hypothesis.
According to a study by the business analysis company CB Insights, the reason for the failure of about 42% of startups is the lack of market demand. Many new entrepreneurs take months or even years to realize their hypothesis is wrong.
Understanding that the product is not interesting to the audience, having spent a lot of effort and money on its development, is not the best development of the scenario. Risks can be minimized by using the MVP concept.
The target audience’s reaction will allow you to adjust the basic characteristics of the product and the business model, plan a roadmap, and change the strategy. Testing on the target audience with the help of MVP will give such voluminous results, and in the future, opportunities to create a full-fledged version of the development,
The idea of an MVP has become so popular due to the many success stories of business giants that have grown out of it. Take, for example, Facebook: initially, it was launched as a platform with the only parameter – the ability to find classmates and exchange messages. And only then, having checked the viability of the idea, and tested the hypotheses, did they begin to add functions to the platform – and today, Facebook is a huge corporation, a system, and the venue has a huge number of opportunities.
And we can find many more such examples. Snapchat, Amazon, Twitter – they all grew out of the MVP on which they tested hypotheses.
From the moment of the idea of creating a new product to its successful implementation is a long way. Thanks to the implementation of MVP, you can:
- save money, as you will not have to invest in an unprofitable business project;
- measure the niche and understand whether there is an opportunity to work on ready, formed demand;
- find out the level of interest of users in your product;
- determine the best development vector using iterations;
- to form a base of real potential customers and early adopters of the new product.
Remember that an MVP is about a process. About the process of testing, collecting feedback, refinement, and new market entry. The MVP should be tested throughout the development phase regularly. Alpha (internal) testing is done by the developer company’s testers, while Beta (external) testing requires outside help. The ideal option is to attract a real audience of future users. Data analytics technology is essential in this process. There are many great reasons to use data analytics to create digital products. Data analytics can be equally helpful when developing physical products to bring to the market.
Thanks to the process and the non-stop movement, it is possible to avoid creating useless products – which means the development of the market as a whole.
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