How To Test A New Product or Business Idea
When you are start-up or small business owner, there are probably times when you want to test out a new idea to see if it will work or be of interest to prospective customers. One effective way to do this is an approach popular with the tech-industry called an MVP. This is a very simple, stripped-down version of a website, product or landing page with just enough features to satisfy early customers, test pricing or see if people even want what you are selling.
The goal is to get valuable feedback before spending a ton of money on a full rollout. See Figure 1 for a visual representation:
Here is how it works:
What you THINK the market needs (blue circle)
If you are like me, you’ll assume there are a lot of needed features on the website and the overall set might be bigger than what your market actually needs. Please note that there are some features your market needs which you are not aware of yet. Therefore, there’s only a partial overlapping of the red and blue circles.
What your market ACTUALLY needs (red circle)
This set has all the features that your market would ever need to solve a particular problem on your website. It includes both crucial as well as nice-to-have features. Most of the time, even your market is not aware of the features it needs . That’s why you need to work hard to uncover them.
What you can afford to build (yellow circle)
You certainly don’t have an infinite amount of money to spend on building your website. Most of the times, this circle will be smaller than what your market needs. But hey, don’t despair, your market needs both crucial as well as nice-to-have features, so you might want to focus on the crucial features and spend less money.
Your Minimum Viable Product – MVP (the green area)
It’s the set of features that makes your website take off. Therefore, your mission here is to find out what those “just enough” features are for you to start generating some traction. Quick ways to measure traction could be the number of visits to your website or landing page, form submissions, the number of downloads or even payments.
NOTE: Some people even sell fake products and return the money from the sales to test if there is demand for their idea. An added bonus is they have captured email addresses to market to when they do the actual launch.