Launching a successful product takes time and effort. But that doesn't mean you have to spend years perfecting something in a vacuum. MVP development helps you get the product into the hands of end customers in a shorter time, collect feedback, and iterate based on the real needs of your target audience.
As a software product development company with 13+ years in the market, we know a thing or two about the MVP development process and its inherent challenges. And we’re sharing our battle-tested tips, approaches, and best practices for MVP development in this article.
What is a minimum viable product?
MVP, short for a minimum viable product, is the first product that you need to serve to see if your product idea can solve the exact problem the customer is faced with. It's that simple.
What an MVP is not:
- An MVP is not just a product with features cut in half.
- An MVP is not a way to get your product out there as fast as possible (it doesn’t have to be a product at all!)
- And it’s not something you set and forget.
An MVP is a process that you repeat over and over again. At the core of the MVP development stage lies the idea of creating a product with only the essential features that should be enough to make that product functional. Later, when early adopters try the product, the product owner collects user feedback to make further integrations based on the needs of the target audience.
Based on feedback analysis, you can make an informed decision about the product’s future: either scale up with the client's needs in mind or shut the project down at an early stage if the product doesn't appeal to its target audience.
MVP software development vs. PoC vs. prototype
Contrary to popular belief, a minimum viable product is not always a great starting point. In some cases, startups need another approach to reach their goals.
Proof of concept or PoC aims to verify that your idea is feasible in terms of technical implementation. A PoC is usually intended for internal use. Along with technical feasibility, startups can leverage a PoC to determine if a project is worth time, money, and resource investment.
A prototype is a visual, clickable representation of a product concept that demonstrates the look and interactions of the product. Prototypes provide a tangible way for startups to test user interaction, spot usability issues, and get early feedback from potential users. Startups can also use prototypes as a way to visually represent the idea and its potential to investors at an early idea stage.
An MVP is a releasable version of your product, complete with a must-have set of features that helps you gauge market response and see whether your target audience is willing to pay for it.
In short:
- Start with a PoC if you're unsure if the underlying technology can support your idea or need to identify the financial viability of your product.
- Build a prototype to refine the user experience and design of your MVP.
- Develop an MVP to validate your product concept with real users and gather valuable feedback to iterate and improve.
Benefits of building an MVP
Why would one launch a product with core features when they can offer target users a bundle of full-fledged functionality from the very beginning? Well, there are many reasons why startups and established brands build an MVP or minimum viable product first, including:
Idea validation
In a post-mortem of more than 100 startups, CB Insights discovered that the lack of market need was the number one cause of startup failure. A minimum viable product plays a crucial role in helping you achieve product-market fit by acting as a bridge between your initial concept and a successful product that clicks with your target audience.
Also, an MVP helps you identify potential issues early on and avoid costly mistakes further down the line.
Lower costs
Each additional feature contributes to more time and money for development. It's always better to prioritize features, implement the core ones, and enrich the MVP with additional functionality later to cut the initial development costs and reach the ROI earlier. With MVP development, you can build the simplest product version using the least amount of resources and get valuable feedback from early adopters.
Related: How much does it cost to develop an app
Faster time to market
Full-fledged applications require a lot of time to develop. Relying on small MVP launches, where a product is tested and refined in a real market setting, helps your product hit the market faster and bring meaningful changes to the end users.
The same approach is manifested in creating an MVP. By building a minimum viable product, you can access the target market early, secure your place in the niche, and outperform your competitors.
Data-based scalability
You can't know for sure what features users want and need. Often, the users themselves don't always realize the pain points they want to fill with the product. An MVP allows users to try the mobile app early and leave feedback for you to build upon. Based on this feedback, you can make a more informed decision about further MVP enhancements.
Early marketing
It's never too early to start marketing. Early feedback from an MVP launch helps inform your marketing strategy by revealing what resonates with your target audience and what aspects of the product need further emphasis. An MVP also fosters an early marketing approach, allowing brands to engage with early adopters and drum up their interest in the final product.
Easier to get funded
In addition to the reasons below, there is an extra advantage for startups seeking third-party investments. There are billions of ambitious startup founders who have a million-dollar business idea, but only a percentage of these founders will research the market needs and users' needs to work out a business plan. Entrepreneurs who end up building a real product are even rarer.
Startups that move forward into developing an MVP tend to stand out, as they can prove that their idea can survive in harsh market conditions. Hence, investors are more likely to gain profit or at least reach an ROI. An increased likelihood of acquiring an ROI is a significant benefit of using an MVP, as 75% of venture-backed businesses never return cash to investors.
However, no approach is perfect, and that doesn't exclude MVPs. Limited functionality raises the risk of losing some customers who aren't satisfied with the offered core functionality. To eliminate this threat, you need to think through the features you plan to include in your MVP so that your product solves a problem of potential users and all the features contribute to usability.
How to build a minimum viable product that gets results?
So, how do you build a minimum viable product? Don't start by rushing into hiring the MVP software development team.
Before you move forward, there are many factors you should consider. In our next section, we will provide a detailed guide on how to create a minimum viable product with maximum efficiency.
Determine the problem
Every product is created for a purpose — to solve a particular problem. In other words, every product delivers real value to customers, making their lives easier. And that's exactly what you should keep in mind when developing your minimum viable product. You should know what problem, an existing one or a manufactured one, your MVP aspires to tackle.
An existing problem
This type of problem refers to a challenge or pain point that a target audience currently faces. When developing a minimum viable product (MVP), identifying and addressing this problem is crucial for product success.
Flo is a prime example of an app addressing a real-world problem. By filling the void in women's health information, Flo has become a go-to resource for accessing, tracking, and gaining insight into women’s personal health information. Along with curated cycle and ovulation tracking, the Flo app provides tailored health insights, expert tips, and a supportive community, forming an informative ecosystem for women to support them during their entire reproductive lives.
In 2023, Flo launched a game-changing feature Flo for Partners that is designed to empower partners with scientific insights into their significant other’s menstrual and reproductive health. Today, Flo has over 380 million downloads worldwide and 68 million monthly active users. In mid-2024, it reached unicorn status.
An artificially created problem
With this type of problem, the main idea is to introduce new user behavior that will provide a better experience. The world is continually changing, and we always see changes in politics, economics, and technological capabilities. And, as the world changes, the market needs to evolve, too.
Let's consider the COVID-19 pandemic. These worldwide changes provided an opportunity to popularize a brand-new patient experience known as telemedicine applications. Consumer adoption has skyrocketed, from 11% of US consumers using telehealth in 2019 to 46% of consumers now using telehealth as an alternative to traditional healthcare visits.
Usually, introducing a solution for an artificially created problem means higher marketing and functionality costs because you are delivering a new experience to your potential customers. In these cases, you need to clearly explain the benefits of your product to your audience and provide maximum user-friendliness.
The ultimate factor to keep in mind when solving a manufactured problem is the product's use. The application should be useful, or you risk joining the club of startups that failed due to a lack of market need.
Analyze the market
The next step is to carry out market research, and through this process, you can size up the competition. You should know whether alternative solutions exist, and if they do, you'll need to determine how your product stacks up against competitors.
High competition means that you need to stand out from an array of similar products — either by distinguishing your product through a better design or through cleaner functionality to address users' needs.
Alternatively, the key to success may be offering a new solution to an existing problem. By using the competition to your advantage, you can demonstrate the value of your product and show how efficient it is compared to others.
Although your initial focus should be on the primary market, don't forget to analyze other markets, too. With a global mindset, you reduce the risk of failure in foreign markets if you expand in the future.
Define your target audience
At this stage, you should be able to define your target users and lay the groundwork for an early marketing strategy. To do that, you need to create a detailed buyer persona that goes beyond basic demographics like age, sex, and location.
If you are looking to spot early evangelists, you can create and promote a landing page with a full product description. On your landing page, have an area where early adopters can leave their phone number and email address.
Determine a business model
In the context of building an MVP, a business model can be defined using three aspects:
- Value proposition — The value proposition is a concise statement that clearly articulates the benefits a customer will receive by using your product or service. It's crafted by considering three key factors: the problem, the peculiarity from market analogs, and the audience.
- Monetization — Monetization affects functionality and the overall idea. Although you may not include it in your MVP 1.0, you will implement monetization in future updates. Planning your monetization strategy helps to minimize future mistakes and additional costs.
- Distribution — Before you start building an MVP, think about how you want to distribute the product. Find the most cost-efficient and direct ways for your product to reach the end user.
Identify a user flow
A user flow is a detailed roadmap that outlines the steps a user takes to achieve a specific goal within your product. It starts from the user's initial interaction (e.g., landing on your website) and follows them all the way to a successful outcome (e.g., completing a purchase). For example, in pharmacy applications, the primitive user flow typically looks like this:
Of course, each step listed above includes sub-steps, like searching by medicine name or checking nearby pharmacies, which sometimes makes a user flow challenging to define.
List the essential functionality
A typical problem that startups face is an abundance of product features that aren't necessary for a minimum viable product. That's why when you create an MVP app, you should distribute functionality into several updates, starting with basic features for the initial launch.
There are several methods to determine which functionality should be included in MVP 1.0. At Orangesoft, we use the feature prioritization approach to nail down the essentials.
Prioritization starts when your team brainstorms and results in creating a backlog of all the possible features. Then, each feature is categorized according to its priority and how much it affects the product's value. Each feature will be determined as one of the following:
- Influences value;
- Might influence value;
- Doesn't influence value.
Functionality that doesn't influence the app's value can be put on the back burner. The features that might influence value should also be held on to or substituted. For example:
- If you want to offer all social networks for authorization, you can choose the most popular social network among your target audience. Alternatively, you can opt to only offer email or phone authorization instead.
- Instead of creating a separate page for feedback, leave an email address so users can send their feedback or provide a pre-filled feedback form.
Here, you shouldn't sacrifice analytics services. To make a reasonable decision on what functionality you're keeping in your MVP, consult marketing specialists about what metrics are essential. For example, you should track the pages that users leave on instead of monitoring how much time is spent on signing up.
Planning the MVP development
A successful MVP development process is one that goes smoothly without affecting the product’s quality or undermining the project budget. The key to a smooth MVP stage is prior planning. At this stage, you should collect and jot down all the requirements regarding your app idea, including the key milestones, timelines, features, and other data points.
Before you start to create an MVP, you need to determine whether you will develop your product in-house or turn to an app development agency. To make the right call, consider available expertise and budget. Then, start working out more in-depth development details by answering the following questions:
- Who will be included in the app development team?
- Does your product idea require further exploration?
- Who will create the app's design?
- Will you pursue native or cross-platform development?
- How will the testing phase be carried out?
Sometimes, it may be too complicated to answer these questions alone. If this is the case for you, consider involving professionals in this decision-making process.
Minimum viable product development
Once you’ve addressed key questions, the MVP app development process begins. Usually, MVP development follows an iterative approach, where your team gradually builds up a product by performing multiple cycles of refinement. To make sure you’re on the same page with your team, schedule bi-weekly check-ins to monitor development progress and identify any potential roadblocks.
During development, product owners are usually tempted to add bells and whistles to perfect the product, especially if the budget is loose. However, adding more features is the wrong approach because doing so undermines an MVP's philosophy.
If you can afford extra features, reference your list of optional functionality from the planning stage, but don’t get carried away. Remember – the MVP's main priority is rapid validation that helps you improve the final product according to the customers' needs.
Testing and quality assurance
In parallel with development, your testing team validates the delivered functionality to make sure it’s up to par with predefined goals.
The steps for effective planning and execution of MVP testing are:
- Define your testing goals and objectives, including success criteria.
- Develop a testing strategy that outlines your testing methods.
- Draw up a test plan that specifies the strategy, objectives, resources, and processes for a particular testing activity, including the scope of testing, testing schedules, pass/fail criteria, and other considerations.
- Create clear, well-defined test cases that identify a particular scenario or condition to be tested within your MVP.
- Choose an optimal approach to testing: automated, manual, or a combination of both approaches.
- Conduct a variety of tests (usability, performance, security) to assess the MVP's functionality under diverse user conditions and on different devices.
- Analyze test results to identify areas for improvement.
Skimping on testing and quality assurance is a hard no for startups as these activities help pinpoint areas where the user experience is clunky, confusing, or frustrating. Also, user testing sessions can provide valuable insights into user behavior and pain points, helping you iterate on your MVP.
Launching your MVP
Now comes the exciting yet potentially nerve-wracking moment of truth: launch day. The launching process includes the following steps:
- Making your MVP available to your target audience through your chosen platform.
- Monitoring your MVP for errors.
- Implementing your pre-planned strategies to attract users and encourage them to try your MVP.
- Using analytics tools to track user behavior within the MVP.
- Carefully reviewing all user feedback and analyzing usage data to identify common themes, pain points, and areas for improvement.
You can turn to a soft launch approach to minimize the risk of launching, optimize your marketing expenses, and test-drive your monetization. This approach includes a limited release of your MVP before the full-scale public launch.
How much does it cost to build an MVP?
The inevitable question of costs is one of the primary considerations for MVP owners. We at Orangesoft have delivered a range of MVP projects across industries and know firsthand that estimates always vary.
The cost of creating an MVP depends on the app's complexity, the number of platforms and features, the development timeline, and other cost drivers. Let’s estimate an MVP using one of our projects, a workout app, as an example.
| Feature | Development time, hours | Backend development time, hours | Approx. cost, $ |
|---|---|---|---|
| Sign in / Sign up | 42 | 32 | 3700 |
| Adding personal info | 32 | 16 | 2400 |
| Profile | 56 | 18 | 3700 |
| Home screen | 72 | 32 | 5200 |
| Workouts | 96 | 56 | 7600 |
| Nutrition | 96 | 40 | 6800 |
| Dashboards / Reports | 96 | 72 | 8400 |
| Notifications | 24 | 20 | 2200 |
| Subscriptions | 56 | 56 | 5600 |
| Architecture | 56 | 32 | 4400 |
| Server interaction & API | 46 | – | 2300 |
| Database | 24 | 16 | 2000 |
| Admin panel | 156 | 110 | 13300 |
| Total | 756 | 460 | 60800 |
Based on our estimates, developing an MVP for a workout app will cost you around $60,800. Keep in mind that this estimation includes basic costs related to the development stage.
You’ll also need a team of business analytics, QA engineers, designers, and project managers to get your MVP up and running. These activities are priced separately and aren’t included in the estimation above. You can contact our team to get an accurate estimate.
At Orangesoft, we optimize your MVP development costs by using design systems and UI libraries, as well as reusable components, third-party libraries, and APIs that are suitable for your project.
What to do after an MVP launch?
Launching an MVP is not the finish line, it’s the starting point for a continuous cycle of improvement. After you get your MVP out the door, you should collect real-world feedback and fish out new ideas from it, which can then be implemented in further iterations.
During the feedback stage, you should work with a test group to collect meaningful insights about the product's strengths and weaknesses. For example, you may want to survey a test group on what they would like to see in future versions of the application.
Once your product has picked up enough traction and a solid user base, you can scale it and transform it into a full-fledged product based on the insights you’ve collected. Here’s what ‘scaling an MVP’ includes:
- Refining your product vision and prioritizing the next releases based on user feedback and market data.
- Bringing in tech talent aligned with growth objectives.
- Adjusting the product’s architecture and code so it can handle increased user demand.
- Scaling testing efforts to cover the growing product functionality.
- Making adjustments to your product’s monetization model.
By following these steps, you can transform your MVP into a successful, growth-ready product.
Measuring success after building an MVP
Another important step to take after your MVP launch is to track your performance. Key performance indicators, or KPIs, will help you measure the success of your product after the big rollout. Below, we've curated a list of essential metrics to track.
Number of downloads
App download data is probably the easiest way to track the popularity of your minimum viable product. As the name implies, this KPI has to do with the number of times that an app gets downloaded to a device. You can keep tabs on this metric on the app marketplace or use a standalone analytics tool.
Percentage of active users
Daily active users (DAU) to monthly active users (MAU) is a popular metric to track user engagement. Essentially, it's the proportion of your daily active users over your monthly active users, expressed as a percentage. Your definition of active can be based on app login or any other activity that brings value. You then need to divide DAU by MAU to get the ratio percentage. The rule of thumb is that your apps need to have a 20%+ percentage of active users.
Percentage of paying users
This metric helps you tap into the number of users who convert post-install. The percentage of paying users is estimated by dividing the number of unique paid users on day X by the total number of customers who installed the app X days ago.
Average revenue per user (ARPU)
Another indicator of the product's profitability, the average revenue per user (ARPU), equals the average revenue made from each user. The percentage can be calculated by dividing the total revenue generated by the number of app owners.
Churn rate
The churn rate is another measure that should be tracked closely by the MVP owner, especially if users pay on a recurring basis. If customers don't stick around for too long, you won't be able to make up for your average acquisition cost, which in turn means that your product is loss-making.
Churn rate quantifies the percentage of service subscribers who:
- quit their subscriptions within a given period, or
- uninstall or walk out of an app over time.
Abandonment rate and app churn can be used interchangeably. This app metric is usually calculated 30 days, 7 days, and 1 day after users download the app for the first time.
The most basic calculation is to divide the number of lost users by the total number of users at the start of the period and multiply the number by 100. For example, if your application had 5000 users at the beginning of the month and lost 140 users by the end, you would divide 140 by 5000. The answer is 2.8%.
User ratings
Ratings and reviews allow you to look into the customer sentiment about your MVP. Users typically leave ratings and reviews on app marketplaces to give feedback on their experience with an app. Ratings improve your app's discoverability, promote downloads, and create connections with customers.
Also, this metric helps you plan further improvements to your minimum viable product and gives you a better idea of the lacking features.
Customer acquisition cost (CAC)
This index refers to the full amount associated with winning over each user of your app over a given period. Customer acquisition cost indicates your marketing performance and the effectiveness of your marketing spending and development efforts.
To calculate CAC, you need to summarize the costs of acquiring new users and divide this total by the number of users acquired over the defined period.
Customer lifetime value (CLV)
Customer lifetime value is the total amount of revenue a single app user can generate over the entire period of their relationship with your application. Unlike the average revenue per user, this indicator takes into account both the direct revenue and indirect value a user generates.
This means that CLV will be based on all transactions a customer conducts over a given period, such as in-app purchases, subscriptions, ad impressions, and others, as well as an indirect value, such as the number of users a given customer refers to your app.
What is the secret behind a successful MVP?
Based on the best MVP practices, we can determine the following five criteria when defining a successful MVP development process:
- Early planning — The more time you devote to planning, the more mistakes you catch, and the less time and money you spend.
- Data-based approach — An MVP and its subsequent updates should be backed up by data to reduce the risks of insufficient market fit and unnecessary functionality.
- Proper marketing — Your audience should anticipate the launch; therefore, you need to devote a significant amount of resources to marketing.
- Only essential features — Don't try to build an MVP app with every possible feature included. Instead, build an MVP around the essentials.
- Skilled development company — A professional IT team is your backbone when it comes to building an MVP app. Having a skilled team helps to guarantee flawless application and faster development.
If you keep these criteria in mind, building an MVP at reduced costs can be possible within a short period.
Stop guessing and start growing
All great things start from small beginnings. You don't have to jump into full-fledged mobile app development to take the market by storm. Instead, you can build an MVP, test the viability of your business idea, and iterate on it.
At Orangesoft, we follow a calibrated MVP development process designed to maximize your chances of achieving product-market fit. Here's what sets us apart:
- Focus on the discovery stage: We don't just guess what users want. We conduct thorough user research to understand their needs, pain points, and behaviors. This deep dive ensures your MVP resonates with the right audience from the start.
- Data-driven decisions: Our approach is built on data. We draw upon user interaction data combined with qualitative feedback to prioritize features and functionalities that deliver the most value to your target market.
- Strategic guidance: Beyond code, we'll advise you on your business model, marketing, and other considerations to ensure the success of your MVP launch.
- Networking opportunities: We help you connect with the startup community and engage in new partnerships through our global network. Focus on growing your business while we’re busy developing your MVP.
If you have questions about concept development, prototyping, user testing, or finding the perfect MVP development partner, our team of experts is here to guide you.
