Using a Minimum Viable Product Strategy

August 10, 2015
App Development,Help Guide

A guide to approaching your project smart

My father, George, believes much of success is based on luck. He believes this because of his life experiences: He started his first business in the 80s, a video rental store. With my mother, two other partners and the bank, he raised enough money to start their first shop in Blackhall, Edinburgh.

When they were applying for a bank loan, they were requested to complete a business plan. The cash flow forecast was based on my Dad’s expectations – he’s a complete realist, although I call him a hypochondriac! After their first month of trading it was clear he was way off the mark, they made 17x his predictions, and that remained true for the rest of the year. The 3 of them went on to open more and more stores and eventually parted ways in the mid 90s.

Why this was Madness

The chances of getting a business right, first time with no testing, business development or what Eric Ries calls ‘pivoting’, is close to zero. Or at least that’s the way you have to look at it. What my father did was bonkers, he put up all this money, took out loans and did it based on what he and 2 others thought was right. Madness!

Unlike my father’s business. creating an app or web-related business  means that you don’t have to put up 12 months’ rent and buy enough stock to last the first month. You’re not confined to one area within a city. And because pretty much everything you’re doing is digital, you’re able to make corrections with minimal investment. So because of this, you have the ability to test every aspect of your system as you go.

  • ‘Why are users not upgrading’?

Test: Try showing the upgrade facility when they open the app.

  • ‘Why are they still not upgrading’?

Test: Try showing the upgrade facility once they have completed a certain function.

The list goes on. You can twist, pull and flip your system anyway you like until you have real data, your chances of success aren’t based upon what you thought, but upon what you know from real users.

Let me give you a case study:

Jordan Begg

 

Case Study

Jordan, our wonderful lead developer, has one day woken up ecstatic because when we was asleep he dreamt of a ground-breaking idea, something to put his name on the map. There’s only one problem, he’s forgotten all of his coding abilities. Jordan can’t code anymore, so, sadly we can’t keep him here simply as a mascot, and off he goes, but full of enthusiasm as he has a winning idea.

Jordan decides to call his app ‘J Card’. Although he can’t code anymore, he does know how to launch an app in a calculated way. His idea is to offer holiday visitors to Edinburgh an app which they purchase for a 2 week license. By purchasing the app, tourists can walk into a large number of selected stores ranging from clothing down to food venues, and receive up to a 20% discount. Sounds great, right? £9.99 and a family of 4 saves a ton over the course of their holiday. Yes, it sounds great in theory, but how do we know it will work in practice? Questionnaires? Well Jordan knows that’s old school, and not efficient!

Firstly he does the obvious and contacts all the stores he can. Of everyone he approaches, 100 stores have decided to give between a 5 and a 20% discount. Great start. Now, how do find out whether people will actually buy a J Card? If Jordan uses his hard-earned savings, the cost of the full app will be £50,000. That’s a lot of money. He understands though, what a Minimum Viable Product is (MVP). To make the app as basic as possible, it’s going to cost £10,000, which again is a large chunk of cash. What he does, though, is goes back to basics, and buys 500 plastic cards with his new J Card logo printed on them. Jordan goes round 50 of the stores and gives them each 5 cards as well as a print-out piece of paper clearly showing the offer. The stores are asked to promote the card verbally to their customers, and if they sell it, they will receive all the money which is £4.99 for every card.

Now so far, only 250 cards have been used. The other 250 are staying with Jordan for the moment as he is going to use them to test online marketing over Facebook. He creates Facebook advertisements, takes some attractive pictures clearly showing the offer, and has a web development firm build a landing page. Jordan runs 4 advertising campaigns all at the same time targeting different audiences in each one i.e. families, males, females, those aged 30 – 40. The campaign shows up on Facebook’s newsfeed, and users can see his offer. When they click on the ad – which appeals to them as they will be in Edinburgh soon -, they are taken to the landing page where it describes what the card does, how to pay (paypal) and where to collect (Jordan’s Address/ contact number). Jordan budgets  £3.00 per day to each campaign, so £168.00 over 2 weeks.

This has taken a week of Jordan’s time to organise; stores, cards, advertising and web development. All of which has come to a total of say £768. After 3 weeks from start to finish, Jordan has conducted a test with a MVP which will give more data to prove the success of his app than a questionnaire or 1000 phone calls ever could. Not only that, should he want to put this forward for investment, the chances of acceptance based on this type of investigation (should the results prove positive), are way higher!

A Final Thought

Not every idea is lucky enough to have simple testing methods available like this one, but what I hope I have shown is that breaking down development into phases allows you to build a product around user feedback rather than what your own opinions. Results from 1,000 people can be way different from 10,000, and as your app moves through each phase you will be able to refine it, bringing it closer and closer to what the mass market is looking for.

If you have any questions, feel free to get in touch by clicking on the ‘contact us’ button on the top right of this page.

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