A minimum viable product (MVP) allows you to validate your idea for a SaaS product or marketplace application while also providing research-based direction on what features you’ll need to include in order to launch a successful application.
What is an MVP?
An MVP is a simplified form of your application that tests the product’s idea, features and functionality. Many entrepreneurs choose to develop an MVP to assess product assumptions and monitor target users’ reactions to a product’s core functionality to validate a product before investing a significant amount of time, money and resources into its complete development. This approach allows you to address one specific problem and engage early adopters with an initial model of your product.
Because it’s an iterative process, MVP development ensures that you take an approach of building, measuring and testing and applying new learnings to future iterations. You’ll continually improve your application as you test new assumptions, gather new insights into user needs and launch new features. This development strategy allows you to better serve your customers over time by focusing on improving and evolving the product instead of spending a lot of money and time trying to get it right the first time.
Explore the benefits of developing an MVP.
One of the main benefits of developing an MVP is that you can keep costs low while still releasing a product in the market, allowing you to provide immediate value to early adopters. While you’ll need to make an initial investment in order to do so, another significant benefit of developing an MVP is that you’re able to use it to validate — or invalidate — your SaaS product idea, which can help you attract investors or prevent you from making an expensive mistake and shed light on ways you can pivot. You’ll also gather helpful insights about users and the market while going through this process, which will help clarify the direction you need to take as well as aid in setting a strong foundation for future iterations.
A crucial step in the development of your initial product is defining your MVP’s roadmap. That process will entail conducting market research, engaging in user research, outlining goals, creating user journey maps, defining the scope and performing user testing.
Understand the estimated costs of building a SaaS MVP.
Many factors will impact the cost of developing a SaaS product or MVP, but the complexity of the application will play the biggest role in the total cost of the project. The more features and functionality, the more it will cost. This fact makes building a SaaS MVP an appealing option, as you can keep costs down while still launching your product and iterating it over time.
Another factor that will affect the cost is who you choose to develop your MVP: an in-house development team or a software development agency. In-house teams come with a significant overhead expense, which doesn’t always make financial sense for many entrepreneurs, startups and small businesses — especially if you’re still validating the idea. You may opt to outsource the development of your SaaS MVP, but because some firms charge high fees, it’s incredibly important that you do thorough research before selecting your software development agency.
Developing an MVP allows you to spread your project budget out over a longer period, and ensures that you save money by gaining insights before making expensive decisions. This approach also keeps the product agile, which allows you to pivot as needed after launch.
Discover four reasons why you should develop an MVP.
There are four main reasons you should consider developing an MVP instead of focusing on your SaaS application’s full development:
1. Market Validation
Launching an MVP allows entrepreneurs to assess if market demand exists for their products. Understanding the need for the product — and users’ propensity to pay for it — is key to your application’s success.
2. Return on Investment
Because your investment is spread out, and the approach gives you the ability to test assumptions and gain insights from users, you’re able to make sound, strategic decisions that generate a higher return on your investment.
3. Core Functionality Focus
Because an MVP focuses on the core functionality of the product and its key features, you’re able to hone the product’s foundational offering at the onset and then add additional features. From a product design point of view, this lends itself to the development of a better product. The alternative — developing the full product — distracts from ensuring that the core functionalities fulfill the product’s primary goal.
4. Attract Investors
Having an MVP increases your chances of securing funding, given that investors can see whether your product has potential or not. Investors are going to take any entrepreneur with a working prototype more seriously.
Take a step-by-step process when building an MVP.
No matter whether you outsource SaaS development to an agency or execute the project in-house, the steps for building an MVP should remain the same. Before the UI/UX design phase, you’ll need to conduct market research to validate that you’re solving an industry problem and that the solution effectively addresses the issue. Ideally, as an entrepreneur, you’ll already be well aware of these pain points and can easily identify the need, but market research will also offer key insights into how to best solve the problem for your target market.
During the user experience phase of the project, wireframes and the application’s information architecture should be developed in order to inform low-fidelity mockups of each screen that give you a sense of how the MVP will look and function. The user interface stage of the project centers around designing each screen, which involves selecting fonts and colors as well as determining how buttons and other visual elements will be displayed.
When it comes to the development phase, you can set yourself up for success by planning out the project’s technical requirements at the onset. After developing the product, you’ll need to conduct quality assurance activities to ensure your SaaS MVP is functioning properly.
After launching your MVP, consider working with a growth marketing agency to implement a user acquisition strategy that promotes the application and converts new users. Marketing the product can be a huge undertaking, especially if you’re still growing your team. Continue to learn from users by measuring key performance indicators (KPIs) to understand your SaaS MVP’s traction within the market and the opportunities to shift and improve the product. We highly recommend leveraging A/B testing and analyzing the app’s analytics to gain clarity around the changes you can make to enhance the application’s features.
The market for SaaS products continues to grow, so it isn’t surprising that you might be considering developing a SaaS MVP. Because this process requires a significant investment, you must consider all of the steps this article outlines before embarking on this process. Taking the time to research and plan will ensure that you get a return on your investment.
If you’re ready to get started now, the first step that you’ll need to take is deciding what features to include in your SaaS MVP. Read our helpful guide on how to select the right features for your application.
At Geekbears, we understand that some entrepreneurs are hindered by technical setbacks when developing a prototype for their SaaS application — our own founder overcame those same challenges himself when launching Schoolinks by taking the time to gain an immense amount of technical knowledge. With a passion for designing, developing and launching digital products, we help entrepreneurs turn their ideas into intuitive SaaS and marketplace applications.