In this guest post by Marius Fermi of Tactical Sales Training, Marius explores the benefits and pitfalls of releasing your minimum viable product early, both as a boot-strapped start-up and as an established business.
Normally everyone would say that before you launch or release any product or service, you need to make sure you’ve got yourself a die-hard set of metrics to back everything up. Take no notice, its better if you release early.
When it comes to this day and age of new start-ups, especially in tech, there is an increasingly small chance of delivering a great project on your first attempt. It never helps that our need for speed is increasing and our attention span seems to last no more than 3 seconds, getting easily distracted by a pretty word or colourful banner or button.
Lean Startup & MVPs
A lean startup is a great example of an early release; it’s the delivery of the Minimum Viable Product that makes this type of startup special. When a lean startup releases their MVP they set out to release just a working prototype, not finished or decorated just the fundamental aspects of product are working.
Then the process of always tweaking, always learning and continually changing starts.
What makes an MVP great for startups is that it allows for you to release your initial idea to the world but then use real life on the go metrics to determine what works and what doesn’t. This isn’t studies and stuff out of books, this is the real deal and you can change and adapt on the go.
The MVP also allows you to remain nimble and agile being able to shift in a new direction, if needed, or setting yourself where you are. When you’re new to the market, you have a tiny fan base which means if you decided to shift the prices or align your product with something else, you can. Your user base is small, they also expect changes to occur but most importantly you haven’t committed time and money into R&D for a specific target group.
An MVP gives you the opportunity to find new niches with prospects for better revenue, increased user base or something that makes your business model that bit better.
Hold it right there, the lean startup & MVP approach isn’t for everyone. Just step back and consider everything about your business; the user base, period of time it has been operational, costs, time, everything!
If you’re a business with some operational time behind it you will probably have a market and user base already set up.
This is the problem, your fan base will be annoyed by any new shift and with the MVP you may or may not have a dedicated audience to it. Losing your audience and trying to bring in a new one is a bad move for revenue and growth.
Consider it a power struggle, do you keep your current customers happy or do you go for the supposed larger audience even though your user base sits at 0?
It’s usually an idea to consider what the new plan is, and then do the R&D for it because you are not as nimble as a startup; moving direction or changing pricing can have detrimental effects & it could also spread like wild fire.
Think it through and be certain your idea will become something great; 37Signals have a great approach in which they construct a product to eliminate their problems or simplify it at least. They then sell the product to the public.
All Hail Metrics
Picture the scene, you’ve just spent the last 3 months doing intensive R&D, reviewing endless feedback forms and quizzing your ‘target’ audience. Upon release of your product it seems no one really gives a care in the world for it, but the metrics said otherwise.
As much as metrics are vital for business and shouldn’t be forgotten about in the long term, you need to sometimes forget about them and step back looking at the bigger picture. The problem with metrics is that it should be considered ‘Book’ smart but really you need to be ‘Street/Web’ smart in order to have any success with your first launch.
‘Book’ smart metrics rely on the ideal situations and what your audience should do, but again we have short attention spans so a book with these metrics from 2 years ago will probably not be up to date with ‘Pinterest’ or ‘AirBnB’.
A Lean startup or MVP is ‘Street’ smart because it learns and changes with the demands and audience. Where metrics from a book are static and rarely change you can begin to move with the trends or find a new path that allows you to expand and grow, on a much cheaper scale compared to long term R&D.
Above All Else: Don’t Worry, Be Happy
So if you’re a new startup or company, then embrace the MVP and enjoy the manoeuvrability you have with growth and expansion. Remember that just because a whole heap of new Tech startups appear every day, having fully functional websites & products, doesn’t mean you need to follow.
When those companies fall, they fall hard because they have set themselves a direction and being able to change & adapt on a daily basis is something you need.
The key to having a successful MVP; take it slow and ensure you know where you need to align and how to do it.
Once you have direction, track the growth provoking metrics for long term success.
Afterword by Woody Hayday
Reading Marius’ piece on early release of an MVP reminds me how far metrics have come and how utterly important they are to on-line business today. One of the main reasons now is a great time to get an idea out there is that you can have these user metrics right off the bat. Within a week you could have a solid exposure of your idea against a real life audience.
As Marius discusses established businesses breaking new ground through releasing new, lean, MVP’s it really reminded me of the book 22 laws of immutable investing, specifically how Al Reis and Jack Trout describe “extending the brand” through risky expansion of product lines. It simply might not work to try and share the trust of an established product with that of a fresh release. Personally I would still opt for the lean methodology for a new product released by an established firm, but with some layer of abstraction between the new product and their existing range (I especially like the “experimental” badge and a small price tag.)
As StormGate builds minimum viable products such as prototype web applications for clients we are very familiar with the benefits of the lean start-up methodology, in fact its a central company principle, in the modern day there is less and less room in business for mediocrity, whether in research and development or execution.
Thanks again to Marius for this post.