A minimum viable product, or MVP, is your first sellable version of your product. A common road to success is to try to sell your offerings as early as possible following your initial conceptualization. You will gain insight what work and not work which is the true value of a minimum viable product (MVP).
A minimum viable product, MVP, is:
- A limited, critical feature offering only that you sell to early adopters to gain insight what work and does not work with your paying customers.
- The platform on which you gradually expand with new features that your customers pays for.
- Your test bench with early customers before you invest deeper in product development to increase sales.
In a sense I’m a perfectionist myself and aim for high quality services. Initially in my own career, I overspend time on product development not really understanding the minimum viable product concept.
When I started to increase sales in my own business, I successfully adjusted my offerings from what I learned from my first customers. After a while it hit me; I had started to sell my minimum viable product, my MVP. The problem thought, I had overspent my early product development time on features and services not really needed.
Gaining early revenues is not the target with selling a minimum viable product. The insight you gain from those first sales is the key benefit selling a minimum viable product, a MVP.
Read more about selling to likeminded early adopters.
The MVP include critical features only and exclude any other offerings
It’s easy to fall into the trap that your offering needs to be perfect to attract those sought for enterprise customers. The reality is that your first customers will be likeminded early adopters, not enterprise customers.
You will learn a lot from your early customers and you will tweak your core offering accordingly.
Early adopters will not pay for enterprise features. Much of your overspending on product development is likely wasted with your early customers.
As you increase sales, you will get valuable insight that allows you to develop higher quality enterprise features than you could have done ins a presell desktop product development phase.
A minimum viable product should include critical core components only. It shall be enough to test your hypothesis with early customers. You tweak your offering until you get your early sales.
You should ask yourself these questions:
- What is the core value proposition in your product, or service? Sell this first.
- Does your offering align with identified pain points with your prospects? Everything is not sellable just because it’s a good product. If not, redesign your core offering.
- Are some features critical to customer success with your product? Include those.
- What makes the key difference to your customer, with your product? Be clear.
- Any other product feature you may have should go to your ‘future box’ for possible next-stage feature development. Only focus on the core value proposition and any feature that fits with question 1 and 2.
Answering these questions should give you an idea where you are with your minimum viable product. It should help you answer if you overinvest in product development too early. Not for financial reasons, but before you gain customer insight what work and what does not work with customers.
Your minimum viable product is a platform where you add new features
Importantly thought, you need a true offering, a minimum viable product, a platform. I have seen cases were the offering is scaled back to the extent the product is somewhat unclear. In those cases, your prospect may just implement a different process to get the same outcome.
View the minimum viable products as your platform to develop new features based in insights from your early stage customers.
A client of mine offered a relatively simple back-office IT-system for a product in the financial services industry. Their initial sales came with small, cost sensitive but curious likeminded entrepreneurial financial services firms. With increased sales, i.e. experience with customers, new features were gradually added. Today they have a customer proven product suited for enterprise customers. They also have valuable reference customers that is so important with enterprise customers. With their initial minimal viable product, with very few features, they now have their platform to increase sales.
Remember not only to include the operational offering by also to include strategy and business model considerations. Be mindful before you have been able to your increase sales. A simple minimum viable product makes it easier and faster to sell to early adopters than a complex offering.
An appealing minimum viable product is tough to nail. You’re likely to have a hypothesis about your unique value proposition, but it’ still only a hypothesis. Proof of concept comes with your early sales, year early adopter customers that pay for your product.
I can promise you from my own experience: It is far easier to nail a unique value proposition appealing to early adopters when the product is condensed to bare minimum viable product. Too many early features shadow you core value proposition for not only your prospects, but also for yourself.
Stay unique and stay firm with your core offering, don’t pivot too early
Although a minimum viable product is essential to attract early adopter customers you need to consider your core:
- If you manage to attract paying early adopter customers: Stay firm with you pain point solving hypothesis for your customers.
- If you have challenges to increase sales with early adopters: It’s usually not your MVB that is the problem, if you tick off the previous 5 questions. It’s often sales execution. Most likely you either target too large and too sceptic enterprise customers too early, or miss selling with relationship journey’s.
Don’t pivot too early. Give your hypothesis a chance, niche down your offering and focus on your sales technique.
Read more about why selling with a relationship journey is a must to increase sales.
Minimum viable product – conclusion
Me and many others have seen plenty of great product not taken off trying to target enterprise customers too early. The other common failure is overinvesting in product development before selling the core offering to enough of early adopters. The steam runs out. The burn rate get’s too high.
Most importantly, not starting with a minimum viable product means a great risk of missing the target: An MVP is designed to solve an identified (!) customer pain point. The beauty of a well-designed MVP is that it is easily understood, relatively inexpensive and therefore attractive to early adopters.
There is a reason why there is something called a minimum viable product. It’s your first sellable version of your product that allows you to understand what work and what does not work.
There are nuances on how to define a minimum viable product and how to gradually develop your offering. If you’re still in the early adopter sales stage, let’s say with less than $15 million in revenues, you need a super focused easily understood offering. If you’re crossing the chasm and aim for next level increased sales, your into the next level MVP.
Based on experience it is very likely that your ultimate offering is different from your early product. No need to overdo product development before you first secure sales. That is a minimum viable product.
Read more about the importance of early stage customers.
Read more about how to grow tech companies beyond early customers.