MVP – Minimum Viable Product
I have recently discovered, with great delight, Eric Ries’ “Startup Lessons Learned” blog , and in particular, his post about Minimum Viable Product (MVP). This is not surprising, since we are both fans of Steve Blank‘s Customer Discovery Process.
Eric’s post reminded me, how critical, yet how difficult in practice, the concept of Minimum Viable Product is.
Defining the minimum viable product correctly allows you to release products that are valuable to your customers with the minimal amount of energy and time invested – because as the name says, you have done the minimum, and yet you provide value. Said differently, if you only need to have 2 features in your product in order to sell it for $100, then you’d be crazy to spend the extra effort to add a 3rd or a 4th feature. Plus, by only delivering the minimum, you get to market fast – and hopefully beat the competition.
So why is this so difficult in practice … at least in my experience ?
My first answer is that it is a lot easier to define the Maximum Product than it is to define the Minimum Viable Product.
Defining the Maximum Product entails compiling a list of all the possible features that your product could possibly have: you only need to talk to a handful of customers and take good notes. Critical thinking is not required. It is easy to get consensus on the Maximum Product: More is always better. The only problem is that no company can afford the time it takes to deliver this “ideal” product. Hence this need for the MVP.
The first step in defining the MVP is the one that is most often overlooked: you first need to define the segment of your customers that you target with the new product. The segment has to be small enough to group customer with similar requirements, but large enough that your new product will generate enough revenue.
The second step is to define the theme of the product in terms of benefits (not features). One of the best tools to help define this theme is by imagining that you are putting up a huge billboard on 101 (one the main arteries of Silicon Valley) that will advertise the new product: what does the billboard say?
The third and final step is to define the critical mass of features in the release. In this step, ruthless time vs feature vs price trade-offs need to be made – because the question is not just “what features do our target customers absolutely need?” (this list will always be too long), but rather: “Will our customers be willing to buy the product with these features - available at this date - at this price? Economically, this question may have multiple correct answers. However, in practice, presented with this question, customers will often select a date in the near term, which in turn defines the minimum viable product.