Part of list:
What is an MVP?
- Why do you need MVPs?
- How do PMs think about MVPs?
MVP stands for Minimum Viable Product. This is the most basic product or prototype that you can build and present to users to get their feedback on an idea or concept.
MVPs are used for testing an idea or hypothesis before using time and resources to develop the final product.
If you were traveling by foot and came to a fork in the road, would you trust the nearby villagers to tell you which road to take?
If you said no, you’re right (from a Product Manager perspective). You can’t trust them completely, because you don’t know if they’re telling the truth—or if they even know what’s down each path.
To really be sure which path is best, you need to test each path by going down it until you find where it leads.
It’s the same when building a product. You can’t just ask your customers what they want: when asked, most people will say they want a new feature, but when the feature is released, few actually use it.
In order to see if there’s a real need for the feature, you need to create an imitation and test the customers’ reactions to it. This is called an MVP experiment.
For example, Zappos.com created their first online shoe store without an inventory. Instead, they waited until they got an order and then bought the shoes at a nearby store to ship them to the customer. They conducted this experiment to see how many people would be interested in buying shoes online.
Don’t invest too much into a new product before testing the market’s response. You’d hate to spend lots of money on something that nobody actually wants.
If you test with MVPs, you can lessen the risk of developing a bad product and wasting resources. For a startup, this is crucial.
The job of a Product Manager is to mitigate risk, and the biggest risk to a company is losing precious resources like time, money, and opportunity cost.
Startups usually have one product and very limited resources. Wasting these can mean the end of a startup, so these companies have less room to fail.
MVP experiments for startups will likely be cheaper and more thorough in order to lessen the risk of failure.
On the other hand, bigger companies who already have an established product may be able to afford the failure of a new product or feature.
Bigger companies often care about other measures of performance like brand and opportunity cost.
And many times, failed products are still valuable for a bigger company.
An example of this is Google’s famously failed product Google Glass. The smart headwear never really caught on, and Google ended up losing a lot of money on the idea.
This would have been fatal for a smaller company, but the loss of money wasn’t critical for Google. Instead, they saw it as a “win” for their overall brand image (a daring, forward-minded tech company that isn’t afraid to push the envelope of what’s possible).