Tom Westgate talks to Separate Reality’s Alistair Woodward and Nick Jennings about how a minimal viable product can become your most valuable player.
When Spotify first launched in 2008, it would have been almost unrecognisable to its users of today. This simple application did one thing – streaming music – and it did it well. Once Spotify knew their basic product had potential, they continued to develop it further, adapting to challenges such as licencing rights and user registration along the way. The result is a product that has transformed the music industry.
So why didn’t Spotify anticipate the challenges and address them before they launched a stripped-down initial version? Because they are just one of many companies to follow the principle of minimal viable product, or MVP, in the pursuit of efficient innovation.
Start it lean, keep them keen
An MVP is the product that has just enough features to allow it to be launched and to start gaining users. Launched at the earliest-possible stage, your MVP can be making you money, as well as testing your assumptions or uncertainties about your market and the needs of your customers, even before you have a final, refined product.
Taking the MVP route means not going overboard with development on an idea that has potential even in its simplest state. “Instead of working hard to bundle in every feature you can think of, it is more important to have a product live, working, out there demonstrating value and potential,” says Alistair Woodward of Separate Reality. While your competitor is staking millions of dollars and tying up years of developer time, your lean, mean MVP can be making an impact with real users after a few months, weeks or even days.
In his book ‘The Lean Startup: How Today’s Entrepreneurs Use Continuous Innovations to Create Radically Successful Businesses’ Eric Ries succinctly explains this point: “The lesson of the MVP is that any additional work beyond what was required to start learning is waste, no matter how important it might have seemed at the time.”
Begin the conversation
“Here at Separate Reality, we consider that the result of an MVP can be helping our clients start a conversation with their customers about what they really want,” says Alistair Woodward. Feedback from early-adopters can show what works well with a product or strategy, as well as revealing any unforeseen problems. “The risks from learning this about an MVP are smaller than with a fully-fledged product,” adds Woodward. And because an MVP is being used ‘in the wild’ subsequent iterations of the product are built on priceless real-world user feedback and not on assumptions or guesswork. This can have real benefits in fine-tuning the customer experience.
There is plenty to gain from the minimal viable product approach:
- Lower risk
- Lower cost
- Gain users and market presence more quickly
- Test the customer base
- Get real-world user feedback early in the development process
- Focus on what works well, weed out bad ideas fast
- Gain investor and boardroom buy-in
Nick Jennings of Separate Reality has an example of how innovation in the telecommunications arena could benefit from the MVP approach. “Customers who use a credit card to top up their mobile often earn rewards like loyalty points or Air Miles whenever they use that credit card,” explains Jennings. “So one of our customers might have the idea of developing a top-up app that also allows users to check their Air Miles balance. Well, if it’s easy to do, it’s worth testing. We could build that app, test it in the real world, and see the results fast. Then as the product grows we know it has solid foundations.”
MVPs aren’t only for small start-ups. They are a cost-effective way to innovate for any company, no matter the size of the R&D budget. To illustrate this, Jennings imagines himself in an R&D role at a large chain of bakeries. “If we invent a new kind of puff pastry, we aren’t going to change what we sell in every store overnight. We would try it in a couple of products as t few stores and see how it sells relative to the other, established products. If the customers like it, we will know about it and we can act on that.”
Sometimes the first users of the MVP might not even be customers at all, but members of the board of your company, who might be sceptical of another abstract PowerPoint proposal for a new app from R&D, but could be persuaded to invest if they have seen an actual working version.
So you don’t have to be afraid of taking the plunge, just remember that sometimes your big idea should start small with an MVP.