So you have a brilliant idea and are about to embark on the mission of building a Minimum Viable Product(MVP) to test the waters and you’ve shared this on your friend’s group chat or during your weekly meetings.

You’ve just taken the first wrong step when it comes to building a product. Lesson 101 of being a startup founder; "Your friends are not your target audience and their feedback can’t really be trusted."

It’s understandable that it is a common mistake, but to make sure that you’re building a product that has a target audience and provides value at a hugh-level, you have to validate the product-market fit before or during the MVP process.

In this article, the 9 key activities in validating product-market fit during MVP will be highlighted and explained.

 

What is Product-Market fit?

Product-market fit is the point at which a product newly built satisfies the needs of a specific target audience. This is the tipping point that determines whether a startup will be successful for iteration or fail.

This is an important part of the MVP building process, as no amount of marketing would be able to make up for the lack of a target audience of product value.

A startup that has gone through the key activities in validating product-market fit during MVP has a higher chance of reducing wasted resources and increasing revenue growth.

 
Related: 13 Successful Minimum Viable Product Examples

 

What are the Four Stages of Product-Market Fit?

To understand the key activities in validating product-market fit during MVP, you need to be aware of the four product-market fits (PMF) or frameworks that describe how well a product aligns with the market needs and the level of demand.

 

1. Problem-Solution Fit
2. Product-MVP Fit
3. Go-To-Market Fit
4. Scale Fit

 

1. Problem-Solution Fit

Being the earliest stage of product-market fit, it occurs when you’ve been able to identify a significant problem in the market and propose a solution that solves it.

This focuses on making sure your product aligns with the customer’s pain points before you begin the process of building an MVP.

 

2. Product-MVP Fit

This stage has to do with testing whether the minimum viable product (MVP) addresses the pain points of users.

This step involves gathering feedback from early adopters, observing user behavior, and making the necessary adjustments to align your product with the needs of the users before scaling.

This is, after all, one of the main reasons for identifying the key activities in validating product-market fit during MVP early enough.

 

3. Go-To-Market Fit

This stage occurs when your product has been fully aligned with the market’s needs and you’ve been able to develop a strategy to acquire and retain users.

This is the part where you make sure your distribution, pricing, messaging, and marketing strategies relate directly to your target audience.

Of course, without an effective marketing strategy, you won’t be able to achieve the full-product-market fit.

 

Read Also: What is Minimum Viable Product in Agile & Why Is It Critical?
 

4. Scale Fit

At this stage, you’ve successfully established a sustainable product-market fit in the market. This allows users to see that your product is valuable and shows that your customer acquisition is efficient.

This is a sign that your startup is ready to scale efficiently and the next thing is operations expansion.

 

11 Key Activities in Validating Product-Market fit during MVP

Here are 11 key activities in validating product-market fit during MVP;

1. Identify the Problem and Solution
2. Start Building
3. Build an MVP (Minimum Viable Product)
4. Lay out the Metrics for Success
5. Build a Release Cycle
6. Gather Customer Feedback
7. Assess Willingness to Pay
8. Identify Key Customer Segments
9. Monitor Customer Acquisition, Retention and Satisfaction
10. Run Continuous Iterations and Improve
11. Build a Scalable Go-To-Market Strategy

 

1. Identify the Problem and Solution

This might seem like an obvious activity, but it cannot be over-emphasized. Identifying a real problem that your specific target audience faces would help you outline the solution you want to bring to them using your product.

Your solution should be the direct answer to their pain points. Using Slack as an example, they identified that teams were having to deal with an overload of email communications.

They came up with a solution to create a real-time messaging tool to foster strong collaborations among teams and get rid of disorganized communications. With time, they’ve come to improve the product based on feedback gotten.

 

2. Find Your Audience and Engage

You’ve identified the problem and proposed solution, it’s time for audience searching. This happens to be the second stage in validating product-market fit during MVP because of its high importance.

You might be one of the best startup founders out there, but you can’t skip this step. It’s very important to find your target audience that is directly affected by the problem in the market.

This audience will provide valuable feedback on whether the problem is real, if the demand is on a high-frequency level, and if your solution is valuable enough for them to try it out.

Think of this as getting information directly from the source and not from search engines. Talking to people who face this problem you seek to solve ensures your solution aligns with their needs.

 

You Might Like: 11 Common Mistakes To Avoid When Building An MVP
 

3. Build an MVP (Minimum Viable Product)

This is a gentle reminder that an MVP (minimum viable product) is not a perfect product that should be filled with multiple features.

The goal of an MVP is to test out the theory of your idea using real-world feedback. You have to make sure that the functionality of your MVP is smooth and minimal so as not to confuse or tire out your audience because you’re trying to impress with features.

There are certain mistakes you must avoid when building an MVP and feature pile-up is one of them. In trying to avoid this, don’t forget to build it as fast as possible and get it in front of your desired audience quickly.

 

4. Lay out the Metrics for Success

This doesn’t just apply to the topic of key activities in validating product-market fit during MVP but is a crucial step in startup building.

In order to understand whether your product is moving toward a successful product-market fit, you need to track meaningful metrics. Avoid the need to track vanity metrics like the number of downloads.

They might sound good, but it doesn’t necessarily show whether people are actually invested or finding value in your product. Your key focus should be on retention, engagement, and frequency of use.

These metrics tell you if your solution is solving the problem and providing value. If the frequency and value are low, then you should probably start re-strategising immediately on your next steps.

 

5. Build a Release Cycle

A lot of startups take advantage of the agile framework to build their MVPs in order to get the product out quickly, generate feedback, and validate market needs.

Building your MVP in agile is also part of an efficient release cycle that can aid in getting your product into the market quickly and efficiently.

A rapid release cycle allows you to implement feedback quickly and continuously to improve your product. A cycle method you could use:

• Brainstorming new ideas
• Estimate the time required to build
• Prioritizing tasks
• Specify what needs to be built
• Developing it
• Releasing it
• Analyzing it (Also known as post-mortem)

 

6. Gather Customer Feedback

This is the part where you get detailed feedback from real users. It’s the moment you’ve been waiting for, and it can determine whether you have a successful product-market fit or if it’s time to come up with a better idea.

Of course, you can’t pass through this without conducting surveys, in-person interviews, embedded forms, and using analytics to see how users are interacting with your product.

Early adopters can help provide useful feedback that helps identify missing features, bugs, and areas of improvement, making this a crucial step in key activities in validating product-market fit during MVP.

LinkedIn is an example of a product that launched as a basic networking tool but used their gathered feedback from early adopters who wanted more professional engagement tools to create a sophisticated professional networking platform.

 

For You: Top 100+ Active Angel Investors List
 

7. Assess Willingness to Pay

Testing pricing and monetization techniques are critical in the product-market fit process. This step involves finding out if users find your product so valuable that they are willing to pay for it.

This is what sustains your startup and helps you scale quickly and efficiently. Experiment with different pricing models, you can include free trials, premium versions, and monthly/yearly pricing models.

This enables you to find the right balance between free and paid customers, driving both user and revenue growth.

 

8. Identify Key Customer Segments

This requires a lot of follow-up and in-depth monitoring. It helps you identify which customer segments are most engaged and which one provides the most value to users.

This is not just a one-step process but a continuous process in the key activities in validating product-market fit during MVP.

It allows you to focus on users who are most likely to become long-term customers as different segments may have unique needs and recognizing them helps you fine-tune your product and marketing strategies effectively.

A good example of a product that mastered this step is Shopify, which initially focused on smaller businesses that needed easy ways to build online stores.

Over time, they identified that larger enterprises were also interested in their product and introduced Shopify Plus.

 

9. Monitor Customer Acquisition, Retention and Satisfaction

When validating product-market fit during MVP, monitoring customer acquisition, retention, and satisfaction is very critical. These factors give you actual insights into whether your minimum viable product (MVP) is solving the problems of users effectively.

Customer acquisition shows how well your product attracts new users and it is important to know how people discover your product and if your marketing strategies are effective or in need of re-direction. Although, it’s not just enough to acquire, because retention is a better indicator of product-market fit.

Retention measures how often your users return after the first trial which suggests that your product constantly provides value. If your retention rates are low, it means your MVP isn’t compelling enough and users are leaving after the initial user.

Customer satisfaction is the final phase of this as it helps you understand how happy and satisfied your users are with the product.

You can utilize user surveys, customer reviews, and direct feedback when it comes to figuring this out. Even if you have users that aren’t satisfied, their feedback can be used to make the necessary improvements to your product.

 

10. Run Continuous Iterations and Improve

Continuous iterations and improvement key activities when validating product-market fit during the MVP stage.

This is the part that involves gathering user feedback, analyzing product performance and making iterative changes to your MVP based on the real-world data obtained.

Don’t forget that your MVP is a skeletal framework of what you wanna put out there fully and every feedback would be used to improve on its features and take out the ones that serve no value to users.

This is an ongoing process as user feedback and technology evolve over time. The iterative stage allows you to refine your core features and fix any issue that might stifle your product’s user retention.

 

Related: Hire Pre Vetted Developers | Silicon Valley Standard
 

11. Build a Scalable Go-To-Market Strategy

During the MVP stage, you’re not just validating the product but the efficient methods that will be used to deliver it to your users and sustain growth.

A go-to-market (GTM) strategy involves several key components such as distribution channels, pricing, sales tactics and marketing approaches.

In the early stages of your GTM (Go-To-Market) strategy, you can start out simple and just focus on getting the attention your product needs and acquiring your first few users.

When you move towards product-market fit, your strategy needs to evolve to support scalability.

 
To achieve a successful scale, your GTM strategy should include:

• Clear messaging explaining your product’s value proposition to different customer segments.
• Efficient distribution channels, whether through digital marketing, partnerships or direct sales, which can grow as demand increases.
• A pricing model that reflects the value users derive from your product and supports sustainable growth.
• A marketing plan that aligns with user acquisition goals and helps you target your specific audience.

 

Now that we’ve gone through a detailed explanation of key activities in validating product-market fit during MVP, we believe you’re suited to make informed decisions.

It seems real now and you’re ready to get down to work, but can you do all of this alone? Do you have the technology and team in place to get this done? Would this be the first of many failed startups or would you be on the list of prominent startups in a few years?
 

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