Why testing & validating product ideas with an MVP is crucial for business success

Kristina Walcker-Mayer, Chief Product Officer at Bitwala, talks about purpose, value and how to translate it into a customer-focused product using the concept of MVP.


The concept of MVP


Most of product ideas don’t work or require iteration. That’s why it is very important to gain learnings about the product and the customers in a very early stage of the product development process. Eric Riess suggests the concept of an MVP, a Minimum Viable Product, in his book “The Learn Startup”. He defines an MVP as “that version of a new product which allows a team to collect the maximum amount of validated learning about customers with the least effort.” Phew, lots of words. Let’s have a closer look into what those mean in detail: 

  • “version of a new product”: this means it is not a full product yet, but it already fulfills the job of a product (e.g. it could fake a certain function of the product, so you can click on the prototype and the desired result will appear)
  • “to collect the maximum amount of validated learning about customers”: these learnings could be about the product value and the market, the target users but also about the viability of the products for this business
  • “with the least effort”: it’s about testing as quick and cheap as possible, MVPs are not being built to last or to build upon, faking features and functionalities are often part of a first test iteration to understand the product’s value


In order to be very specific about what you want to learn and test, the target market should be well defined. It is hard (or impossible) to test a concept if the user group is too broad, as the results start to become very blurry. For example: If you want to build a car, you should define if you’re building a product for the luxury segment or for students, because they might have different needs and this would affect the results of your MVP testing. 

So, an MVP is really not yet a full product. The concept of an MVP is about finding out what are the right things to build and once you are confident in what to build, you can build the things right. 


Why is it relevant to validate your ideas with an MVP before you start? 


1) In the end you don’t want to waste anyone’s time or money on a product that doesn’t solve a customer’s problem.

  • Customers: You should make sure to a) solve a customer problem and b) solve it in the right way.
  • Team: If you work with top notch talent, they most likely want to work on meaningful products that serve a great purpose and solve a problem. In order to maintain them in the long run, you need to make sure and involve them in the learning process.
  • Business: In order to make better and more realistic assumptions on business cases, the MVP approach helps to get better information straight from your customers or partners.


2) We need to understand what we simply “don’t know”. If we are aware of the unknowns, we can collect questions and start to answer them and collect insights. While starting this discovery process, a lot of unknowns are being revealed that we haven’t even thought of. Testing an MVP will shed light on so many new insights, pains and needs of users that will help you iterate and pivot in a more meaningful direction. Or as Albert Einstein said “If we knew what it was we were doing it would not be called research, would it?”


3) We want to create outcome instead of output. The reason why you’re about to build a product is usually because you want to solve a user problem and you see a great business opportunity in doing so. In order to make sure your product will even solve the problem and you can generate some business outcome from it, you need to test this beforehands. But is this not covered in a business case? Yes it is, but your business case will probably be based on assumptions. The more research based information you add to create those assumptions will help you to create a better and more realistic business case. 


4) An MVP helps you to reduce risks when building a product. Marty Cagan suggest the following in his book “Inspired”: 

  • Value Risk: Will the customer buy your product? Is there enough interest? 
  • Usability: Can the user use your product? 
  • Feasibility: Can we build it? Do we have the right setup / resources in place? 
  • Viability: Can it be supported by the business? Are there legal constraints? 


What’s the right scope of an MVP?


In order to define the scope of your MVP, it makes sense to define hypothesis for the challenge you want to learn more about. A hypothesis can be structured in the following way: 

We believe adding one click signup using Google will be a useful feature for busy users who have a Google account as it will save them time. This will increase our signup rate by 25%.

The elements of your hypothesis are: 

  • Belief
  • Personas / Target group
  • User value 
  • Expectation
  • Result that will prove the belief


How to get started? 

Once you have defined your hypothesis, you need to find a way to transport your idea and talk to your customers as soon as possible. While you are going from a very high level towards a more advanced prototype, you will come up with new hypothesis or adjust your idea along the way. 

A good approach to structure your initiative can be to create a customer journey map with clearly prioritized stories. Don’t overload your MVP, focus on the main topic you want to validate. 


What types of MVPs are out there?

MVPs don’t need to be of very high fidelity. You can start with a visualization of your idea, e.g. a paper prototype that will outline your approach and go into a conversation with your users. This approach is very easy and cheap and will help you to create first learnings. 

In case you already have a specific idea in mind about how your product could / should look like, you can use design prototypes in order to test usability. 

If you want to test interest, Google ad word campaigns can be quite helpful to try out how many people are looking for solutions for the need / problem you want to solve. It is a very easy and quick way to learn more about potential interest groups while analysing the clicks later. You might even want to add a landing page behind the ad, which explains your product in more detail and maybe include an explainer video of your idea. In order to get your first test customers, you could even ask your visitors for their email address, so you can contact them for further tests or in depth feedback. 

MVPs can also be a fake of reality. For testing a service in a cheap way, you can also run a so-called Wizard of Oz or Concierge test. The idea behind those MVPs is, that your service or solution feels already quite automated or even personalized for your user, but in the background, you’re doing everything manually. This kind of MVP helps you to test a more complex service with your users and you can detect flaws in the journey without building complex systems. A lot of ecommerce companies have started that way. 

If you’re looking for more inspiration for great MVP examples, check out this video by “development that pays”.

Whenever you test an idea, be aware that we are humans and there is a huge confirmation bias: We’re usually in love with our ideas and would like to confirm them rather than objectively evaluate them. If you are aware of this, you are one step closer to truly trying to understand your customers reactions and feedback and thereby one step closer to a customer-centric product in the end. 

Kristina Walcker-Mayer  brings 10 years of digital experience to her current role as Chief Product Officer at Bitwala. Before that she spent several years as product lead at N26 and at Zalando as product lead in the loyalty and Mobile Apps team, where she delivered customer-centric solutions and drove the mobile mindset within Zalando’s various departments. Besides her passion for building products, Kristina hosts her own podcast “emploYAY”  that challenges us to rethink employment & purpose at work and showcases role models with nonlinear careers & new work approaches.  Before building products on company side, Kristina worked as Mobile Consultant and Account Manager for agencies like Aperto and iconmobile, building up mobile strategies and creating innovative mobile solutions for major clients in the retail, television, NGO and automotive industries.

by Kristina Walcker-Mayer

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