Product Development: MVP and Lean Startup

Product Development Aims

• To grasp the Minimum Viable Product (MVP) concept.
• To understand the Lean Startup methodology.
• To understand why many startups don't achieve product-market fit.

Learning Outcomes

• Grasp the MVP concept.
• Understand the Lean Startup methodology.
• Understand why many startups don't achieve product-market fit.

Introduction to MVP

• Many startups fail because they develop products without validating customer interest.
• The Lean Startup methodology helps eliminate uncertainty in product development.
• It emphasizes failing fast and learning from mistakes to improve the product development process.
• A core component of the Lean Startup methodology is the build-measure-learn feedback loop.
• The first step is identifying the problem to solve, followed by developing an MVP.
• Once the MVP is established, the startup focuses on tuning the engine through measurement and learning with actionable metrics.

Minimum Viable Product (MVP)

• MVP is a product with limited features to test a new business idea and assess customer interest.
• The purpose of MVP is to gather audience feedback before releasing a fully developed product and avoid failures.
• Startups should focus on building an initial product that tests the business model rather than focusing on the features.
• Being too product-oriented and focusing on features excessively is a common mistake among startup founders.
• Over-focusing on perfectionism can lead to a constant product-development loop and failure to solve customer problems.
• The initial built product should aid in the business model testing process to refine the value proposition.

Lean Startup Methodology

• The Lean Startup methodology is based on the book by Eric Ries, which proposes a lean startup strategy for companies.
• The methodology aims to shorten product development cycles and validate the business model.
• It involves running business-hypothesis-driven experiments with iterative product releases and validated learning.

Testing Your MVP

• Testing your minimum viable product can be done in a variety of different ways
• Listed below are the most common

Low-Fidelity MVP

• A low-fidelity MVP can be a landing page with a value proposition, benefits summary, and a survey or pre-order option.
• It can be a website prototype created in PowerPoint or with a landing page builder.
• A physical MVP can be made using materials like cardboard, wood, plastic, or polystyrene.
• Validate the business model hypothesis with potential customers using basic MVP features.
• Alternative MVP options include a video, a painting, or an animation.
• Create a quick website prototype using platforms like:
  • PowerPoint
  • Google Sites
  • Weebly
  • GoDaddy
  • Unbounce
  • WordPress
  • Yola
• Coder friendly platforms for website creation include Wix.com, WordPress, Drupal, and Joomla

Customer Interviews

• Interviews help gather deep insights and allow for asking questions and observing customer interactions.
• They enable gathering suggestions and identifying desired additional features.
• In startups, opinions matter, so surveys and customer interactions are vital.
• They are useful for testing business model hypotheses.
• Key questions include:
  • "Would you pay for this?"
  • "Does this solve your problem?"
  • "What would you do better?"

Landing Pages

• Landing pages are the first interaction point for customers on your website.
• They should convey the value proposition, unique selling proposition, and product/service information.
• Use data collection tools like Google Analytics to measure customer behavior.
• Offer pricing options/packages to gauge interest and engagement.
• Use videos and interactive content to test customer interest.
• Validated learning is achieved through visitor analytics.

A/B Testing

• A/B Tests assess the effectiveness of different product variations.
• Companies use them to measure website changes and optimize customer experience.
• Data collection tools help assess visitor reactions to prototypes, which can be for apps, websites, physical products, graphics, and illustrations.
• A/B/C testing involves testing three versions and A/B/C/D testing tests 4 versions.

Crowdfunding

• Crowdfunding helps with funding and market testing, as fundraising itself validates the market.
• Start with a small funding round to test the market.
• Meeting the target validates the product/services.
• Failure indicates the idea is not market-ready.
• Crowdfunding provides PR and visibility for the product launch.

Explainer Videos

• Videos help present products/services engagingly.
• The Dropbox MVP video got first sign-ups and secured venture capital funding.
• The video validated the product and business idea without a physical product.
• Startups use videos with surveys to test MVPs, which solves the problem of reaching the target market.

Digital Prototypes

• Digital mockups and illustrations work well on screens as they’re easy to look at and show to people.
• Mockups are made functional with buttons and sliders.
• Market research companies use mockups for product testing, as mockups mimic the end product's functionality and usage.
• Mockups range from low-fidelity sketches to motion graphics and PDF's, testing user experience and journey.

Paper Prototypes

• Paper prototypes are illustrative and provide a haptic experience.
• Can be made of paper, cardboard, newspapers, etc.
• Used when creating customer journeys and design features.
• Used as the preceding step before digital prototype, simple to design the surface.