Why MVP is important for business development

Minimum Viable Product (MVP). What is it and how can it be used for business and market analysis?

Do you know how many times I’ve seen companies with great teams create great products but fail to succeed? This often happens when they don’t pay attention to one important detail – the product’s relevance to the market. And this is what we really need to find out when we launch a new idea.

Personally, I always turn to the lean startup methodology to check this fit. But it is not limited to startups. This methodology is suitable for any product or service.

3D TV case study

To illustrate the importance of product-market fit, let me give you an example.

Do you remember when 3D TVs took the market by storm 15 years ago? It was a time when 3D movies were gaining popularity in cinemas, and electronics manufacturers decided that it was the perfect time to introduce the same technology into the home. In the beginning, there was some interest among tech enthusiasts, but in the end, the technology failed to find its consumer in the mass market. In other words, 3D TV has not achieved product-market fit.

Why: Firstly, many consumers use their TV as a background rather than as the main element of entertainment. To watch 3D content, you had to wear special glasses and sit at certain angles, which was inconvenient and required additional effort. Consumers were not willing to pay big bucks for a technology that did not make their viewing experience much better, let alone more comfortable.

In addition, some users have complained of eye strain and headaches from wearing active shutter glasses. This further increased scepticism about the technology. As a result, 3D TV did not become more popular than existing TV equipment.

Conclusions: Manufacturers underestimated market demand. The technology was valuable only to a narrow circle of home cinema enthusiasts who were willing to pay for minor improvements in viewing quality. The mainstream demand never materialised. Content providers that had initially launched 3D content with great fanfare began to gradually withdraw their offerings.

This example shows how important it is to check the relevance of a product to the market. Despite the technical capabilities and marketing efforts, if a product does not meet the needs and expectations of consumers, even the best technology can be left without demand.

Marketing testing: benefits for your business

Before investing a lot of resources in launching an idea, it’s important to get feedback from your target customers. This will help you not only avoid unnecessary costs, but also improve the product so that it meets the market’s needs.

Testing is your chance to check if everything is moving in the right direction.

In a highly competitive environment, launching a product cannot be done in a hurry. It is important to plan carefully, and a key part of this process is understanding how the market will perceive your product. Conduct market testing to find out what your potential customers really think, what their expectations are, and how best to position your product for success.

Market testing is your chance to understand if there is a demand for the product or service you are offering. If not… well, there’s no point in investing your precious resources in it. But in addition to understanding whether there is interest in its current form, market testing helps to identify what changes can be made to improve the product and increase its chances of success, even if its first version did not meet expectations.

The main thing you need to understand is whether your product or service fills a real need in the market. Are people ready to buy it? And will they agree to the price you are planning? Making a small batch of prototypes will allow you to test the idea on real customers without spending a large budget. This will help you get honest feedback that will go further than just the opinions of friends and family.

How does market testing benefit businesses?

A failed product launch can leave a very bitter taste in the mouths (and memories) of consumers. Without market testing, you can spend a lot of time, effort and money on something that never gets off the ground. If you launch a product that hasn’t been thoroughly evaluated and it fails to meet expectations, you risk losing customer confidence. First impressions are important, and a botched launch can permanently damage your reputation, as consumers are unlikely to give you a second chance.

Those who test your product at the initial stages are well aware that it is not yet perfect. They won’t judge you for mistakes or shortcomings, but rather provide you with incredibly useful feedback. It is this feedback that will help you understand what you really like about the product and where you need to work on the details.

Thanks to this approach, you enter the market not with a ‘maybe it will work’ attitude, but with the confidence that your product is needed and there is every chance that it will be bought.

How to test the market for a new product or why do you need an MVP?

When we talk about testing a new product on the market, it’s like a real culinary experiment. You can only succeed if you know exactly what you expect from your dish. The same applies to business: if you are not confident in your product, neither will your customers.

So, we start by creating an MVP, which is the minimum viable version of a product to quickly test it in the real market. It allows us to collect basic information about how the product works and whether it meets the basic needs of consumers. However, there are cases when MVP does not provide a complete picture of consumer needs.

That’s why there is the MLP approach – a minimally attractive product that already has elements of appeal to the target audience. It allows you to collect feedback, refine the idea further, and prepare the product for a full launch.

A minimum likeable product (MLP) is an initial product that users love from the start. As a concept, it offers the minimum number of features or capabilities necessary for people to adore it rather than tolerate it.

MVP and MLP

MLP is about making an immediate impression and showing that there is something in your product that people will really love. The key task is to create a feeling that will guide the development of the product and ensure its successful journey in the market.

The difference between MVP (minimum viable product) and MLP (minimum marketable product) is similar to the choice between frozen pizza from a supermarket and freshly made Italian pizza from a restaurant.

Let's say you want a Margarita pizza for dinner. On the one hand, you have frozen pizzas from the supermarket. On the other hand, you have freshly made pizza from a real Italian restaurant.

In this situation, the minimum viable product is frozen pizza. Sure, you’ll eat it and probably enjoy it. But will you buy it again and tell all your friends about it? It is unlikely. There are plenty of frozen pizzas available. Supermarkets are full of similar products from competing brands. This option may be a cheaper and more convenient way to satisfy your carbohydrate cravings, but it doesn’t always represent the best value. On the other hand, a freshly made Margherita pizza from an authentic Italian restaurant takes time and resources to create. The product is still minimal, meaning there are no fancy toppings or additional ingredients. However, it is more attractive. It is more enjoyable and ensures that customers will come back again and again.

An MVP, like a frozen pizza ?, is a basic product variant that can be quickly launched on the market with minimal time and resources. It can perform basic functions or solve basic problems, but it doesn’t always captivate users to the point where they become active promoters of the product.

MLP, like a freshly made Italian pizza, looks more attractive and meets more user expectations from the start. This product may have a minimal number of features, but they are done with quality and finesse that generate interest and encourage repeat purchases

The cheat sheet is from me:

When do you need a product MVP?

• When time is limited.
• When the budget is low.
• When the product is so innovative and unique that the most important thing is to bring it to market as soon as possible.
• When a product is created for beta testing.

When do you need an MLP?

• When a product is not the only one in a niche and needs to provide an exceptional user experience to beat the competition.\
• When you want to win the loyalty of your target audience right away.
• When you have already created an MVP and want to move to the next stage.

Both approaches have their places in product development, and the choice between them depends on your strategy, resources, and goals. MVP in business allows you to quickly test the concept and reduce risks, while MLP is aimed at creating a strong first impression and building loyal customers.

You've tested the market - now what?

I hope you, like me, now have a lot of ideas, information and food for thought (and by thought I mean not just thinking, but careful analysis and follow-up). The main purpose of market testing for me is to understand whether there is a real demand for what I offer, whether my pricing policy is adequate, and whether changes need to be made to make my offer better suited to the target.

If I find that the price is too high, I will need to think about what I can change to reduce costs without sacrificing quality. Can I make the packaging cheaper? Will I make enough profit with a lower margin? Is it possible to use other materials?

When it comes to the product or service itself, it is at this stage that I really listen to feedback. It can be difficult to accept criticism about something I believe in, but I need to put emotions aside. I want to make sales and be successful, so I take every feedback into account and continue to improve my product over and over again.

My product should be easy to use, easy to maintain, and easy to sell. But most importantly, it has to improve my customers’ daily lives.

From testing to triumph?

So, what does successful market testing mean? It’s not just a tick in the to-do list, but a real confirmation that your idea has life and potential. When you see that your product not only meets a need, but also arouses interest, it gives you energy and confidence. You can now move forward with pride and determination, knowing that your efforts have not been in vain.

Every customer review and reaction is not just numbers or statistics – it’s real human emotions and opinions that inspire improvement. Now your goal is to make the product perfect. It needs to be so easy to use, useful, and reliable that everyone who tries it feels like it’s exactly what they were looking for.

With successful market testing under your belt, you can move forward with a sense of positivity and determination. Your path to triumph has just begun, and there are still many interesting achievements and victories ahead ?.