Innovating with customers: How you can use MVPs to create successful products

Key takeaways:

• Prototype Refinement: Engage prospective customers early to refine prototypes and ensure new products align with market needs
• Value Early Feedback: Early user feedback can refine your MVP to meet market needs
• Structured MVP Testing: Implement a clear testing process with goals, user selection, feedback collection, and iteration
• Iterate for Improvement: Use feedback for continuous product refinement
• Weigh Costs and Benefits: Consider resources, time, and cash flow before deciding on MVP testing

In this second part of our three-part series talking about customer co-creation, we will delve into how you can use Minimum Viable Products (MVPs) to engage fans & early users to refine your product and why doing so impacts how customers view your product post-launch.

In our previous article, “Innovate with Your Customers: The Key to Continuous Improvement and Market Leadership”, we explored how customer-centric innovation, exemplified by Unilever, uses customer feedback to drive product improvement and strengthen brand loyalty. The next step is to incorporate prospective customers’ feedback to nascent ideas and MVPs, ensuring that our initial concept evolves into a product that truly resonates with our target audience.

Testing your MVP

The MVP is a core concept in the Lean Startup methodology, designed to streamline product development. An MVP is a simplified version of your product that includes only the essential features required to address the primary needs of your target customers. The goal is to launch quickly with minimal resources, gather customer feedback, and use those insights to iterate and improve the product.

Everyone talks about the need to test your MVP. But why?

By allowing target customers to tinker with your MVP, you gain valuable insights to shape the future of your product before it is launched. This allows you to gauge the level of interest, prioritise features, test usability, and build customer trust along the way.

Case example: How test user feedback shaped Slack’s success

Slack, a widely used messaging platform, was initially created by Stewart Butterfield and his team as an internal communication tool for their gaming company Tiny Speck. Slack evolved from supporting their game project "Glitch" to become a standalone product. Recognising its potential, the team pivoted to developing Slack as a collaborative app.

Before its public launch, Slack proactively gathered user feedback. It started with internal testing, extended to friends at other companies to be early test users. Early user companies included Rdio, a music streaming service company, and Cozy, a rental property management platform company. Rdio utilised Slack’s prototype within a small group of front-end developers first, before spreading it to the whole engineering group and then to all 120 people in the company. Butterfield and team immediately understood that their product would function differently as size increased.

Slack listed to early users’ feedback and refined their prototype over multiple iterations in order to make it desirable for workplace teams of all sizes.

After a year of private testing – that’s right, a full year - Slack publicly launched in February 2014, receiving overwhelming demand with 8,000 requests on the first day and 15,000 by the second week. By end 2014, Slack had achieved unicorn startup status, valued at$2.8 billion.

By 2022, Slack had become a leading workplace communication tool with 35 million active users and generated $1.5billion in revenue. Their focus on gathering user feedback to improve their product paid off, making it the preferred choice for teams across various industries.

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How should you develop an effective MVP testing framework?

A well-executed MVP test involves several key steps in chronological order:

1. Defining clear goals: Set clear objectives to focus on
2. Selecting the right users: Define target audience demographics
3. User-friendly testing environment: Ensure ease of use with clear instruction
4. Gather feedback: Use various methods (e.g. focus groups, questionnaires etc.) to collect both quantitative and qualitative feedback
5. Iterate and refine: Analyse feedback and identify areas for improvement

By continuously incorporating test user feedback into the product development process, brands can create products that truly resonate with their target audience, which would plausibly increase sales post-launch.

Weighing the Costs and Benefits

While MVP testing offers significant advantages, it is vital to consider the potential costs and resource implications. Factors such as budget constraints, time sensitivity, and product complexity can influence the decision to proceed with beta testing.

Some key factors to consider include:

• Resource constraints: Testing an MVP can be resource intensive. A tight timeline and budget constraints may not allow for MVP testing
• Time sensitivity/ competitive pressure: Testing MVP with test users can take time, which may cause businesses to lose an opportune moment to capture market share and/ or beat out a competitor developing a similar product
• Cashflow: MVP testing takes time and requires resources, so it’s important to manage cash flow

It is important to note that MVP testing is crucial for innovative products and may not always be necessary for straightforward products with established product-market fit. For simple products with well-defined specifications, or for products that have already well-established needs, a full-scale product launch without testing an MVP works. For these products, undertaking Level 1: customer-centric innovation will suffice in considering feedback from customers.

MVP testing is a powerful way to get customer insights on the products desirability, usability, and ways to improve it. And while MVP testing and refinement is a powerful tool, it's only one part of the customer co-creation journey.

Moving Forward: The Next Level of Co-Creation

In our next article, we'll explore Level 3: Direct Customer Collaboration. We’ll delve into how to continue to delight customers even after you’ve run out ideas. Look out for our final part in our three-part series about customer co-creation as we describe how to crowdsource ideas directly from your customers.

At Binomial Consulting, we focus on in strategies that help companies to innovate and drive sustainable, long-term growth—just like Slack’s success stories. Work with us to develop cutting-edge solutions that align perfectly with your market needs and build a future-ready brand. Contact us today to redefine innovation together!

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Sources: Helio, Minimum-code, Techcrunch, First round review, Foundation inc., Business of apps, Faster capital, Medium

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