Building a minimum viable product (MVP) is a great way to test the waters for a new venture idea. It enables you to measure customer interest and provides a reliable baseline to take the next step (e.g. develop, pivot, or kill).
Skipping the MVP is a risky choice, which can lead to months of lost time, effort, and funding - building a product or service nobody wants to buy (one of the top reasons ventures fail). It’s a crucial step in the lean startup methodology’s build-measure-learn feedback loop.
But in order to get that sweet user feedback, you need to take the next step; you first have to create customer interest and engagement. That’s why having a solid MVP go-to-market (GTM) strategy is so crucial.
Let’s take a look at the top five steps involved in building an effective go-to-market strategy for your MVP. But first, a little bit of context.
What exactly is an MVP?
The concept is simple: create a basic version of your product or service with just enough features to test it among early adopters (it could be as basic as a 2D drawing). Then let the data roll in. The goal is to minimise development costs and risk by gathering customer feedback to improve future versions of your offering.
It’s an iterative process, which means you’ll be repeating it over and over again:
- Identifying your concept’s riskiest assumptions
- Finding the smallest possible experiment to test that assumption
- Using the results of your experiments to course-correct
MVPs vary as much as the products and services they test, which means they can take various forms, including product demos, apps, landing pages, 3D mockups and even crowdfunding projects. No matter what direction you decide to take, it’s a good idea to ensure your MVP has the following characteristics:
- It should provide solid buying intent data (e.g. clicks on the “buy now button”)
- It’s detailed enough to show customers the value of buying
- It provides enough reliable data to guide your next steps
In essence, MVPs enable you to partner with your customers, involving them in the building process and ensuring the features they love are included in the final product. What better way to prove your product/market fit?
Pre-GTM checklist for your corporate MVP
Before you start building your GTM strategy, it’s a good idea to have the following two things checked off your list:
Determine the type of MVP you want to launch
Think about the resources you have available (e.g. time, funding, tools) to determine if you’ll be building an MVP with a high or low level of development.
- Examples of low development MVPs include waiting lists to buy, crowdfunding and pre-orders.
- Examples of high development MVPs include products with basic features, low code apps and concierge MVPs.
*Concierge MVPs involve manually providing a usually automated service to validate how many customers would use it (e.g. Zappos).
List your riskiest assumptions
Knowing your riskiest assumptions is a crucial step to getting the answers you need. It will provide you with a baseline to move forward with the following steps. List your assumptions using the following categories:
Now that you have a bit more background, let’s tackle the five steps to building a successful MVP GTM strategy.
Step 1. Understand the “who”
Knowing your potential customer base inside and out will go a long way in helping you develop a more targeted and effective GTM strategy for your MVP. Understanding who your buyer persona is, what they’re looking for and what they value will enable you to build emotional connections and market to them more effectively (e.g. find them, connect with them, engage them, etc.).
Creating “customer personas” is a good exercise to help you understand their needs, values, pain points and challenges. Customer personas are fictional representations of a typical customer(s) in your target market. The most effective personas are designed to be detailed and specific as if you were describing a real person with attributes like:
- A name
- A career and hobbies
- Likes and dislikes
- Goals
- Challenges
This target group canvas is a great way for you and your team to get started on building an effective customer engagement strategy.
Step 2. Define the “what”
Make sure you have clearly defined goals and targets you want to reach with your marketing strategy. This will make it easier for you the gauge its success later on.
Here are just a few examples of success factors you might want to consider:
- Number of waitlisted customers
- Number of downloads
- Number of video views
Step 3. Identify the “where”
Knowing the best way to reach and engage your customers is a crucial part of your GTM. After all, no matter how compelling your value proposition is, it won’t take off if your target audience can’t see it.
Using your customer persona(s) as a starting point, map out the best places (“the where”) to connect with your potential customers. Some examples include:
- Major media advertising
- Online ads
- Email campaigns
- Seminars and tradeshows
- Webinars
- Private events
- Contests
Knowing where your GTM strategy will unfold will enable you to shape your messaging, targets and overall strategy more effectively.
Step 4. Know what you want to say
Now that you know the “who”, “what”, and “where”, it's time to engineer your messaging. That includes things like:
- Describing your unique value proposition (UVP)
- Choosing a tone of voice
- Designing your brand
- Deciding which “calls to action” to use
The right messaging will help you attract and engage potential customers to test your MVP and enable you to validate assumptions with more data (leading to more reliable results).
A good way to start is by doing a deep dive into how your competitors tackle their marketing (e.g. their tone, the channels they use, the type of content they make, what business model works best - D2C, B2B etc.). This will inspire your own efforts and enable you to learn from their wins, avoid their mistakes and pinpoint marketing channels they might have overlooked.
Also, don’t confine your research to your industry. Look into adjacent products and services for inspiring ideas you can adjust and re-purpose to boost your own customer engagement.
Step 5. Choose your success metrics
The last step on your journey is choosing which metrics will best help you measure and track the success of your MVP GTM strategy. This is of vital importance because the information your metrics provide will feed your decisions moving forward, enabling you to:
- Assess whether or not your efforts are focused on the right activities
- Evaluate how your organisation allocates resources and spots areas for improvement
- Align your efforts with broader corporate goals
- Set a baseline upon which to show your progress moving forward
Although metrics vary from case to case, here are some valuable standard GTM metrics you might want to consider:
Customer Acquisition Cost (CAC)
This metric lets you know the average amount of money you spend to acquire a new customer. This is a useful metric because it helps you understand how profitable and scalable your sales and marketing efforts are.
Customer Lifetime Value (LTV)
This metric lets you know the average amount each customer brings in over the lifetime of business with you. It’s useful because it lets you know whether or not you’re losing money acquiring customers. A good baseline CAC:LTV ratio is 3:1, which indicates that the value of a customer (LTV) is three times higher than the cost of acquisition (CAC).
Monthly Recurring Revenue (MRR)
This metric represents the monthly revenue you can earn from your customers.
It allows you to gauge your short term monthly revenue and understand how good your product-market fit is. If your offering comes in an annual subscription or long-term contract, you can use the information to calculate your Annual Recurring Revenue (ARR).
Lead conversion rates
This metric helps you understand the ratio between how many customers you attract through your sales and marketing activities and how many follow your call to action (e.g. download a report, subscribe to your newsletter, hit your buy button, etc.). It provides insights into how effective your sales and marketing experiments are and enables you to iterate the ones that need work.
Pipeline coverage
This metric helps you understand the ratio between the monetary value of your funnel and upcoming revenue targets. It’s a useful way to predict future revenue and gives you an idea of when to move prospects from one sales stage to another.
When choosing your metrics, make sure to go beyond the typical financial and vanity metrics to really get a complete and detailed picture of your progress. For more details on how to choose your metrics, check out this handy report: How to effectively measure corporate venturing success.
Final thoughts
Putting in the time and effort to test your product and customer experience early on can save you thousands. It will enable you to make crucial changes early in the product development process to ensure the long term success of your offering.
Remember the goal of your MVP GTM is to gather enough data to take your next step - and to do it as lean as possible. It’s an iterative process that will evolve along the way, so don’t be afraid to start small and build as you go.
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Want to build an MVP or take an existing one to the next level? We can help you design, develop and validate your offering using our continuous-improvement methodology. The result? A product launch with a proven market fit and the first customers on board.
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