The concepts of Minimum Viable Product (MVP) and Minimum Marketable Product (MMP) are both pivotal in the product development process, especially in agile and lean startup environments. However, they serve different purposes and are used at different stages of the product life cycle.
Our 14 years of experience building software products have been filled with discussions over the key differences between the two concepts, under the pressure of a key business decision - what to build first?
In this article, we explore some of the key differences between the two concepts, illustrated in a detailed client story, and summarised in a decision framework for CTOs and founders struggling with this dilemma.
First, let’s break down the differences in a straightforward manner.
Minimum Viable Product (MVP)
The MVP is essentially the bare minimum version of your product that allows your team to collect the maximum amount of validated learning about customers with the least effort. It’s not about a product that’s ready to scale or even fully functional; it’s about learning.
The focus is on speed to market and the feedback loop. Think of it as the prototype you’d create to answer the big questions: Does anyone actually need this? Are we building the right thing?
Key Characteristics of an MVP
- Primary Goal: Validate the core hypothesis and solve the primary problem.
- Features: Includes only essential features to meet the initial needs of early adopters.
- Audience: Targeted at early adopters willing to give feedback.
- Outcome: Learnings that guide the next development phase.
Minimum Marketable Product (MMP)
The MMP, on the other hand, is the product that includes the minimum features necessary for it to be marketable, appealing to a broader audience than just the early adopters. It’s what you launch to the public once you’ve validated your MVP.
The MMP is about finding the balance between functionality and time to market, ensuring the product has enough features to satisfy early majority customers and start generating revenue.
Key Characteristics of an MMP
- Primary Goal: Provide a product that meets market needs sufficiently to attract its first real user base beyond early adopters.
- Features: Contains enough features to be considered complete and competitive in the market.
- Audience: Aimed at a wider audience, including the early majority.
- Outcome: A product that can generate revenue and sustain further development.
A Simplified Comparison
- Purpose: MVP is for learning and validation. MMP is for entering the market.
- Features: MVP has the bare minimum to get feedback. MMP has enough to satisfy the majority of early customers.
- Audience: MVP targets early adopters. MMP targets a broader audience.
- Goal: MVP aims to test hypotheses. MMP aims to start generating revenue.
In essence, while the MVP helps you figure out if you should build the product, the MMP helps you figure out how to grow its market presence. Both are crucial steps in a product’s journey from idea to successful market entry, but they cater to different stages of that journey.
Why an MMP is More Complex
In general, a Minimum Marketable Product (MMP) is more complex than a Minimum Viable Product (MVP).
The MVP is centered on the idea of simplicity and minimalism. Its primary aim is to validate the core business hypothesis with the least amount of features necessary. The complexity is intentionally kept to a minimum to facilitate rapid development, testing, and iteration. This approach allows for a focus on learning from user feedback on the most basic version of the product.
An MMP, by its nature, is more complex because it extends beyond the MVP's goal of validation to include enough features and polish to make the product appealing to a broader market segment. It's not just about proving a concept but making it sufficiently robust and feature-complete for market entry. This involves additional layers of development, including user interface (UI) refinement, user experience (UX) enhancements, scalability considerations, and possibly integration with other services or platforms.
Some of the key elements we bring up when discussing these two options with tech founders are:
Feature Set
The MMP includes a broader set of features to ensure the product is competitive and meets market expectations. This requires more development time and resources.
Market Readiness
Preparing a market-ready product involves comprehensive testing, including usability, performance, and security testing, which adds layers of complexity.
User Experience
An MMP requires a higher focus on the overall user experience, ensuring the product not only works well but is also engaging and easy to use.
Scalability and Reliability
As the product is aimed at a broader audience, ensuring scalability and reliability becomes crucial, requiring more sophisticated engineering and infrastructure.
Compliance and Integration
Depending on the product, compliance with regulations and integration with existing systems can also add complexity.
While an MVP is designed to be as simple as possible to validate an idea quickly and efficiently, an MMP involves a more complex development process aimed at creating a product that's ready for market introduction and is capable of attracting and retaining users.
Client story: From MVP to MMP
In November 2022, we embarked on an ambitious journey with Audora, a company poised to revolutionise the audit industry with its cutting-edge cybersecurity and audit automation platform. Our collaboration was sparked by a shared commitment to innovation, quality, and a desire to transform the cumbersome audit process into something streamlined, efficient, and transparent.
Starting with an MVP allowed us to validate the core concept behind the cybersecurity and audit automation platform. Given the innovative nature of the product, it was crucial to ensure that there was a genuine market need for such a solution and that the proposed features resonated with the target audience.
Our initial steps involved deep-dive ideation sessions to understand Audora's core value proposition and the pressing needs it aimed to address in the audit industry. This collaborative groundwork paved the way for the rapid creation of user personas and the first set of wireframes, culminating in a Figma prototype that brought Audora's foundational vision to life.
The development of Audora's Minimum Viable Product (MVP) was not just about technology; it was about redefining the audit process for companies worldwide. By automating repetitive, manual tasks, the platform promised to allow auditors and auditees alike to focus on the bigger picture, thus lowering operational costs and enhancing efficiency in the audit industry.
Launching an MVP enabled the team to gather feedback from early adopters within the audit industry. This feedback was invaluable in refining the product features, addressing any usability issues, and understanding the specific needs of the users, ensuring that the product developed was not only technologically sound but also user-centric.
Developing an MVP before an MMP is also a resource-efficient strategy. It allowed the team to focus their efforts and investment on building and testing the core functionalities of the platform without overextending resources on features that the market might not need. This lean approach helps in managing the budget effectively, especially critical for startups and new product initiatives.
By opting to develop an MVP first, our client mitigated risks associated with product-market fit, technical feasibility, and user acceptance. It provided a safer environment to experiment and iterate on the product design and functionality with a smaller, more controlled group of users before committing to a broader market launch.
The MVP served as a foundation for future development, allowing the team to establish a solid base of code, design, and user experience principles. This foundation made it easier to expand the product into an MMP by adding features, enhancing functionality, and scaling the infrastructure to meet the demands of a wider audience.
Finally, starting with an MVP allowed Audora to enter the market sooner, establishing a presence and beginning to build brand recognition while continuing to develop the fuller-featured MMP. This strategic market entry could also help in attracting potential investors by demonstrating a working product and initial user interest.
A decision framework
Choosing between developing a Minimum Viable Product (MVP) and a Minimum Marketable Product (MMP) is a strategic decision that a CTO or founder needs to make based on the company's goals, the product's stage of development, market conditions, and resources available.
Here's a simplified guide to help you navigate this decision as if you're weighing your options over a strategy session with your co-founder.
1. Understand Your Objective
For Learning and Validation (MVP): If you're still in the phase of validating the problem-solution fit, or if you're not entirely sure about the customer needs your product aims to address, an MVP is the way to go. It allows you to test hypotheses with minimal risk and investment.
For Market Entry and Revenue (MMP): If you've already validated your product idea and understand your market well enough, an MMP will help you enter the market with a product that's not just usable but also competitive enough to start generating revenue.
2. Assess Your Resources
Limited Resources: With constrained resources (time, money, personnel), an MVP allows you to get user feedback without overcommitting. It's about being lean and agile, learning quickly from the market, and iterating.
Sufficient Resources: If you have enough resources to build a more complete product and sustain it until it starts generating revenue, aiming for an MMP might make sense. This is especially true if your market research indicates a readiness for your product's broader feature set.
3. Analyse Market Conditions
Competitive Market: In a highly competitive market, launching an MVP might mean getting overshadowed by more complete products, making an MMP a safer bet to grab attention and market share.
First-Mover Advantage: If you're entering a new or less competitive market, launching an MVP to quickly capitalise on the first-mover advantage and then iterating based on feedback can be a smart move.
4. Evaluate the Risk Tolerance
High-Risk Tolerance: If the business can afford to take risks, starting with an MVP to explore and validate innovative ideas might be the right approach.
Low-Risk Tolerance: For businesses that need to mitigate risks and ensure a certain level of market readiness, developing an MMP might be more appropriate.
5. Consider the Product Type
Complex Products: For products that rely on a certain level of complexity or completeness to be useful (e.g., SaaS platforms), an MMP might be necessary from the get-go.
Simple/Innovative Products: For simpler or highly innovative products where the core functionality itself is a novelty, an MVP can help gauge interest and gather crucial early feedback.
In the end, the choice between MVP and MMP should be guided by a clear understanding of your business goals, the stage of your product, your financial and human resources, and the market landscape. It's not just about what you can build but also about what should be built to align with your strategic objectives. The decision is dynamic and might evolve as you progress, so stay agile and be ready to pivot based on what you learn from the market and your users.
Get in touch to discuss your product plans and to pick our brains on what you should build first and why.