What is an MVP?
There are many different definitions on the Internet that define the expansion of this abbreviation. In order to understand what the MVP strategy is, it is worth expanding this abbreviation, which in a free translation means a product of minimum value. Depending on the industry in which the MVP strategy is used, it may be understood a little differently. That is why it is worth accepting at least one universal definition, that is, it is an experimental strategy of a new project that was made in the minimal version.
Of course, an MVP does not only refer to enterprises and projects. It is a strategy that was developed almost two decades ago. It is used in everyday life, science, personal development and in fact in every field, sometimes being used unconsciously.
By only using an MVP, you can increase your chances of success by preparing for an exam or just by introducing a new product to the market. Why is this happening? Because the whole takes place on a slightly different basis than the typical preparation for launching a new brand on the market.
Why an MVP, not a theoretical market research?
Before the entrepreneur introduces a new product to the market, he obviously tries to prepare it well, if it is a thinking entrepreneur. Getting to know the market is essential, especially from the point of view of potential consumers. This allows for precise preferences regarding a given product or service, as well as financial possibilities, if only for the purchase itself.
In the traditional model, such a market research would probably be carried out by conducting a survey on accidentally met persons or by encouraging people to fill in a questionnaire on the Internet. Of course, this is not a bad way to get to know the opinion of potential customers, but you can not really call it precise. At this stage, you can get a lot of conflicting signals that can lead a company to a greater risk, which in the case of failure, can have serious financial consequences and hurt its image. The questionnaire itself, a conversation with a client, is something that should not be taken away because it can bring benefits after the product has been launched.
For example, one of the contradictory information that you can get from a potential consumer is knowing if he will be willing to buy a product when it appears on the market and how much he would be able to offer for it. Let us not conceal that many interlocutors will be inclined to stretch the truth here, so as not to fall out on poor or scarce people. After incurring the costs of building a product, it may suddenly turn out that the amount declared has not been paid, and the sale among these people is only a few percent.
However, an MVP helps prevent situations when large investments in brand and product development have already been made and it is not sold. The strategy is focused on producing a real, physical product that can be called a prototype or base version, and then put it on the market. What can you get from this? First of all, you can measure what the real interest in the product is. There are many advantages, and each of them increases the chances of success in the project.
Here you can see an advantage over other forms of market research, in this case, we get real numbers, while in some cases, these are just speculations, and very uncertain.
What does the MVP strategy look like?
If an entrepreneur is aware that this strategy will bring him real benefits, it is time to learn how to join it. Of course, the presented scheme can be freely modified and adapted to the situation, because as already stated, the MVP strategy can be used in various ways.
At the very beginning, you must design and create a product in the minimum version. However, it is not about creating a low-quality model, but it should be a real product or a service that can be used. Thanks to the fact that this is an MVP version, we do not incur excessive costs at this stage. Sometimes it will be over a dozen, sometimes several hundred dollars, but always less than if full-dimensional production was started immediately. In the case of an application development company it will be just writing a code and creating an application, for example, designed for meeting interesting people from the nearest area. However, this should be the most basic version. But why? Because thanks to this, you can receive many valuable tips from customers on how the product should look like, what functionalities should be added and what should be changed. On a regular basis, the company will also be able to follow the indicators that will show how the changes affect the sales results in real time
At this stage, once we have a product or service, we release it to the market and observe the behaviour of customers. As some companies have shown in their history, sometimes when selling, this product may not yet exist, as was the case with a company that sold shoes without having them in stock. It allowed, however, to measure interest in the service and brands, which then affected the sales results.
At this point, one should examine carefully everything that happens with the product. It is also a good idea to talk to customers who have purchased our product and ask them for feedback on the product. Each piece of information from such a message should be remembered or noted down, and then used, if it is, for example, frequently appearing information or suggestion. From time to time, our product will receive tips from customers, which could make them more enjoyable and us more aware of necessary changes. The proposed changes will be used to develop the basic product, reaching the final form. However, it is very important to know moderation. Remember that an MVP product will not generate large revenues, and if we delay the start of the correct production, it may affect the financial result. In the example previously provided, that is, the social application, we can use the customer's instructions regarding the introduction of, for example, add photos function or video chat, while checking how it affects the interest in the application.
If the MVP strategy works and succeeds, and the brand succeeds, it means that everything went very well, and we hit the point with the product. At this point, you can start mass production and investment in the product, which has been avoided so far until that moment. By following the hints above, you can check products from virtually every industry. The MVP study is interesting because at the very beginning it will tell you whether a product is worth any more focusing on. The confrontation of the idea with the implementation is an interesting form of checking your creativity and the ability to sense market needs
Advantages and disadvantages of an MVP
The MVP strategy has both strengths and weaknesses to be ready for. Nothing is perfect, but after learning the advantages and disadvantages, you can see how MVP can affect the company's development.
- Low costs of strategy implementation (only product production minimum value and distribution)
- The possibility of adapting the product to the needs of customers, before starting mass production
- Resignation in case of failure which will not result in bankruptcy
- Achieving measurable results that are not hypocritical
- Great time savings
- The product must be produced and released on the market, even in the base version, which is associated with costs
- Higher costs than other market surveys
- The base version may be less desirable than the one which we aspire to
As you can see, an MVP has both advantages and disadvantages. For years, however, this has been a strategy that has been used more often by the entrepreneurs who want to be sure that they will not waste money and achieve success.
An MVP and crowdfounding
The MVP strategy, as launching a real product or a service on the market, gives the opportunity not only to measure sales, profitability or check interest rates, and so on, but is also a chance to get people who support such projects interested. It is worth presenting your project on one of crowdfounding platforms and you can actually check what the real interest in the product is at this stage. In exchange for money for the development of the project, you can, for example, offer a free sample to test, from which you can get an opinion.
An MVP is a way to test your real product on the real market. Targeting the marketing of a product, using only assumptions and the results of uncertain surveys, can not give a real picture of what product development can look like. Therefore, it is necessary to use the achievements of modern technologies to grow and to develop projects utilizing them.
Let no one think, however, that in the case of an MVP, some processes may be neglected and a slightly inferior product may be created. It is very important that the whole process proceeds more or less as usual preparation for production, but on a slightly different version of the product. An opinion about a given company is being built already at the stage of conducting the MVP strategy.
Now all you need to do is personally use an MVP and follow the directions to succeed in business.