How do I test my MVP?

How do I test my MVP?

Why it is important to test your MVP and how to do it best is explained here.

Understanding how to efficiently validate your MVP saves you time and resources. This in turn helps to minimize your business risk. In this article, we explain what to consider when testing an MVP.

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The purpose of an MVP is to test a specific business idea in a lean and resource-efficient way. If you don't go out and test with your MVP, you'll never learn and tend to move slowly in your own little circle. This way, an MVP quickly becomes a resource guzzler for you and your team. The best way to learn more about customer preferences is to test an MVP. This leads to better product decisions, more clarity about what customers really want, and less time and resources wasted.

What is an MVP?

MVP stands for Minimum Viable Product. This term is often used by product managers to refer to a simple-to-use, low-cost product or service to meet the needs of initial customers. It should also provide a way to test whether the customer will purchase the product or service in the future.

Different types of MVP testing

When you develop an MVP, it is important to test it from many different perspectives to truly understand the full potential of the underlying idea. Combining different experiments is usually the best way to get a comprehensive understanding of your MVP's potential. Common experiments at this stage include customer interviews and surveys, landing page registrations, expert interviews, guesswork, A/B testing, etc.

Your innovation sweet spot

Before you plan to test your MVP, ask yourself the following questions:

• What must be true for your product idea to become a lucrative business?
• What is the most critical assumption underlying your MVP?
• Does your MVP meet the following essential characteristics?
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Desirability: A desirable solution, one that customers really crave.

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Feasibility: A realizable solution that builds on the strengths of current operational capabilities.

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Profitability: A profitable solution with a sustainable business model.

It should be noted : If one or more of these features is not met, implementing the idea tends to be riskier and more costly.

Test your MVP from a desirability perspective

Desirability tests: Whether your innovation solves the right customer problem

Generally speaking, collect customer data to better assess their customer preferences.

Here are 3 experiments you can use to test the desirability of your MVP:

1. Customer interviews and surveys
   Customer surveys are extremely important, but they are no substitute for an actual conversation with customers. Combining customer interviews and surveys tends to result in a better overall understanding of customer preferences. Surveys and interviews should be an integral part of every product development process. It's best to organize yourself so that the hurdles to continuous testing are as low as possible.
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2. Landing page registrations / pre-orders
   Landing pages are a low-cost, no-code approach to validating your MVP and attracting early adopters. They are an important tool for collecting customer data in exchange for freebies such as white papers or product samples. The main purpose of a landing page is to collect contact details of potential customers and prospects and to attract them to you and your solution.
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3. A/B testing
   A/B testing helps to identify the better of two variants. For example, these could be two versions of the same value proposition, which are explained and advertised on two different landing pages. Specific metrics such as click-through or conversion rates can then be compared and analyzed.

Test your MVP from a feasibility perspective

Are we building on our core operational competencies?

Can we implement the idea and what do we need to do so?

In general: information that will help you to find out what it takes to implement your MVP.

3 experiments to test the feasibility of your MVP are:

1. Expert interviews
   Exchanging ideas with experienced experts in certain fields helps to advance your idea and usually provides the project team with a lot of inspiration. We like to schedule 20-30 minute calls in preparation for a sprint or workshop. Depending on the availability of the experts, we either invite them to the workshop remotely or we record the conversation in advance. To find the right experts, we use both our own network and contact suitable candidates via Linkedin. We have never received a rejection yet!
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2. A day in the life
   To validate an MVP from a feasibility perspective, it helps to really understand the context in which a solution is used. Therefore, it is worthwhile to evaluate the world of users and providers at first hand as early as the MVP design phase. This “shadowing” can, for example, involve a person from the development team personally accompanying a persona who uses the MVP. This way, various subtleties of the product or service process can be identified at an early stage.
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3. Wizard of OZ MVP
   The magician behind the counter does the magic. The customer, on the other hand, gets the full customer experience. Nothing is automated at this point. Of course, an MVP like this is not scalable. What can be evaluated, however, is what it really takes to satisfy customers. Various startups continue to operate in a partial wizard mode for a relatively long time and gradually automate those parts of the product that have been validated.

Test your MVP from an economic perspective

Profitability: Does our solution contribute to long-term growth?

In general: Information to help you find out which business model best suits your MVP.

3 tools to test the profitability of your MVP are:

1. Business Model Canvas by Strategyzer
   The Business Model Canvas helps you keep an overview while forcing you to look at a business idea from key perspectives. It is a visual diagram with elements that describe the value proposition of a company or product, the infrastructure, the customers and the finances.
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2. Provisional profit and loss statement
   It can be well worth taking the time to calculate a projected profit and loss statement for a business idea. Of course, at the end of the day, it is all guesswork and much of it will never turn out exactly as assumed at the time of planning. Nevertheless, this exercise is extremely helpful in breaking down the big picture into smaller details and asking important questions about the profitability of an idea.
   
   Guesstimation
   Guesstimation is a method for quantitative approximation. It approximates reality and is therefore helpful for estimating the market potential and profitability of new products and services.
   
   Classic guesstimation KPIs are, for example:
   - Total Addressable Market (TAM: e.g. total chocolate consumption in Switzerland)
   - Serviceable Addressable Market (SAM: market share for sustainable chocolates with a high cocoa content)
   - Serviceable Obtainable Market (market share of SAM that is realistically targeted)

Conclusion

It is absolutely crucial to continuously test your minimum viable product from different angles during the development process. Try to understand the most critical assumptions underlying your MVP and choose the appropriate experiment to test them. Never forget that the purpose of your MVP is to test your business idea in a lean and resource-efficient way. Happy Testing!