Minimum Viable Product: 4 Characteristics of MVPs in Business

A minimum viable product (or MVP) is a basic working version of a new product with enough core features to offer value to potential customers. Businesses release this low-cost product model to collect user feedback from early customers and validate the product’s viability in the marketplace. The MVP can help companies determine whether a product idea is worth further development or highlight a potential issue that can impact its ability to turn a profit down the line.

A minimum viable product has a couple of key purposes. Rather than devoting a lot of time and funding to creating a final product for a trial, MVPs allow startups to develop a bare-bones working version and release it to the public at a fraction of the cost. The sooner a company begins operations, the sooner it can attract customers and investors.

MVPs are a key way to receive real market feedback from early customers that can positively affect the product’s development. The development team can incorporate the feedback into the next version of the product—whether by doubling down on core features, pivoting to a new angle, or developing a new product altogether.

Minimum viable products can be an excellent starting point for a business:

• Allows you to start your business with minimal resources. MVPs are usually cheaper to produce, allowing companies to launch with fewer resources, minimal effort, and lower risk.
• Helps create better final products. By factoring in market feedback so early on in the product development process, the MVP approach can help businesses develop a better final product with the features and functionality that customers need.
• Can help avoid major product rejections. Some companies spend a lot of time and money building a full-fledged product and later find out there’s no market need or product-market fit. MVPs help companies avoid this situation by allowing it to test the market as early as possible, receive validation or criticism, and make the most marketable product.
• Builds customer relationships. Customers typically enjoy interacting with MVPs. If the business continues to develop the future product and incorporate their advice, early adopters often remain loyal to the product and vision and continue supporting the company.
• Can open the door for early funding. Securing venture capital or crowdsourced funds can be a significant obstacle in starting a business. A sturdy MVP makes it easier to catch the attention of funding sources and get your business off the ground.

A good minimum viable product:

1. 1. Contains the essence of the product idea: A minimum viable product needs to showcase the basic core feature set of your product idea. If the MVP is too spare, the company won’t receive reliable customer feedback. For example, if your final product is a car, producing a tire for the MVP will not be helpful because customers won’t understand the basic viability or usability of a vehicle from a tire alone. Instead, producing a pared-down car may be more useful since it has enough features to communicate the product idea.
2. 2. Low-cost production: Ideally, a minimum viable product is inexpensive to make with the least amount of effort, which is especially important for startups that typically have less working capital. The business should be able to quickly launch the MVP and receive valuable feedback without spending a significant amount of time or money building it.
3. 3. Valuable: A good MVP should give early adopters some insight into the final product and the value it will provide. When developing the MVP, consider the target market for the product and potential pain points it can address.
4. 4. Room for iteration: Your MVP should serve as a great starting point for future development—allowing you to start with the core features and iterate upon them to create a product that a broad user base will find helpful and valuable.

There are a few different categories of MVPs:

1. 1. Physical: If you’re aiming to create a physical product, you’ll likely need to develop a physical MVP to test your product’s features. Some physical product MVPs are launched on crowdfunding platforms since the production costs can be slightly higher.
2. 2. Product design: A product design can serve as an MVP (especially for digital products) if the design gives customers a reliable idea of your product’s core features. Types of product design MVPs include sketches (freehand or digital), mockups and landing pages (primarily focused on the user interface), wireframes of webpages or mobile apps (primarily focused on user experience), and demo videos.
3. 3. Piecemeal: A piecemeal MVP combines different existing products or software to create a working prototype. For example, combining an existing forum setup and digital artboard to create a collaborative drawing experience.
4. 4. Concierge: Concierge MVPs are prototypes of a digital product that are initially performed manually for testing—for example, if you want to create a website that automatically ships books to purchasers, you can start shipping books manually as your minimum viable product to test the business model before coding the back end.

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