This chapter is a free excerpt from The Viral Startup: A Guide to Designing Viral Loops.

December 7, 2009

Downtown Palo Alto

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December 7, 2009

Downtown Palo Alto

What’s a minimum “test” of your product? And what are you testing?

A hypothesis-driven approach to product development dictates that you build as much as you need to test our your product, but not more and not less. But what are you “testing” your product for?

One possibility, as lean startups guru Eric Ries has stated, is to test your product for “viability.” He’s coined an important term, called Minimum Viable Product, and I’ll excerpt his excellent blog post below:

The idea of minimum viable product is useful because you can basically say: our vision is to build a product that solves this core problem for customers and we think that for the people who are early adopters for this kind of solution, they will be the most forgiving. And they will fill in their minds the features that aren’t quite there if we give them the core, tent-pole features that point the direction of where we’re trying to go.

So, the minimum viable product is that product which has just those features (and no more) that allows you to ship a product that resonates with early adopters; some of whom will pay you money or give you feedback.

He goes on to state that another example of this idea would be to set up a landing page and test for clickthrough rates and signup conversions, to see if there is any interest in the product. You could also stick a priced offer on the landing page to see how that affects peoples’ interest in registering for the site.

Viability is certainly one bar you can test for, but a related (and overlapping concept) is around testing product desirability. Let’s discuss this further.

Viable versus Desirable

The idea here is that different companies often pursue products with different primary lenses – a business-driven company might try to assess viability upfront, thinking about metrics and revenue and market sizes. A feasibility (engineering) oriented organization might try to pick a super hard technology first (P2P! Mapreduce! Search!), then try to build a business around it. And a desirability-focused team might focus first and foremost on the target customer, their context and behavior, and build a product experience around that.

Thus, a Minimum Viable Product tends to center around the business perspective – what’s the minimum product I have to build in order to figure out whether or not I have a business? You might do that from testing signups on landing pages, try to sell products before they exist, etc. Putting up price points and collecting payment info is encouraged, because it helps assess the true viability of a product.

But what if you come from a human-centered perspective, and you want to build the Minimum Desirable Product? I think this is a subtle difference with big implications. A minimum desirable product (MDP) would focus primarily on whether or not you are providing an insanely great product experience and creating value for the end user.

Let’s define it as such:

Minimum Desirable Product is the simplest experience necessary to prove out a high-value, satisfying product experience for users

(independent of business viability)

To build an MDP, you will have to actually deliver the core of a product experience so that your customers can make a full assessment, rather than simply providing a landing page. Instead of measuring YOUR conversion rates and revenue generated, instead you might figure out the metrics of what benefits you are providing to the user. Similarly, you might make extensive use of qualitative research techniques, such as the ones detailed by IDEO’s methodology card deck.

This also relates very much to Marc Andreessen’s definition of product/market fit, which he defines in purely market “pull” terms and not based on business ideas or viability. You could view the the Minimum Desirable Product as the simplest product that has a credible shot at providing that product/market fit.

Examples of MVP versus MDP

Let me make some quick distinctions about sites that might be Minimum Viable Products, but perhaps not Minimum Desirable Products, and vice versa.

  • If you build a really viral social network that is profitable but has terrible user churn – you have built an MVP but not an MDP.
  • If your profitable dating site gets lots of users to buy subscriptions at $20 per month, but none of them find hot dates they were promised, you have built an MVP but not a MDP.
  • If you build a magic box that spits out money whenever you hit a button, that is certainly desirable but not viable at all.
  • If you create an amazing board game that your friends and family love and are addicted to, but you can’t get a game company to distribute it, you have created an MDP but not an MVP.
  • If you have created a website with 20 million+ unique visitors per month, where people can tell each other what kind of sandwich they are eating, that has probably passed the desirability test but not the viability test. (By the way, I am writing this blog while drinking a soy latte at Cafe Epi in Palo Alto, but not eating a sandwich, for those who are curious.)

Is desirability more important for consumer internet startups?

One of the key reasons why I began to think of this question is that it strikes me that consumer internet companies often don’t care much whether or not they have viable businesses in the short run. If you are building a large, viral, ad-support consumer internet property, you just want to go big! As soon as possible! This is particularly true for ad-supported sites where you need to break through a certain size to start talking to the brand ad agencies who can pay up on CPM. As a result of that, the goal becomes to hit product/market fit as soon as possible, and figure out the business model later.

Similarly, the key risk for consumer internet startups tends not to be technical risk or execution risk – it tends to be market risk. That risk may manifest itself as questions on whether or not there’s enough consumer value, or whether or not the market is big enough. These are things that may be proven purely based on desirability-oriented questions rather than getting into the business or technical side at all.

Minimum Feasible Product?

The last thought I will leave you with is: perhaps there are markets where the engineering portion is the most important – and thus the most important concept of Minimum Feasible Product.

For example, for a drug company curing cancer, the focus wouldn’t be on minimum viable product because if you have a cure for cancer, you’ll be viable. Similarly, you may not focus on desirability, because your product would clearly have pull from the market. You don’t need to do landing pages or user-centered research to figure out that curing cancer is a big deal from a business and user point of view.

Instead, the focus would be on Minimum Feasible Product – what is the smallest amount of work necessary to field a credible candidate for an “in lab” solution to the product?

For consumer internet, perhaps there are similar examples of this.

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