3 Important Steps To Build A Lean Marketplace Product
In the last article, we discussed the importance of validating your marketplace idea and a few steps to do so. Assuming you have already validated your marketplace idea, it is now time to build the lean marketplace to test the viability of the product. This article focuses on the important steps to build your or lean marketplace product
What is a MVP?
If you have read The Lean Startup by Eric Ries, you already know what a MVP is. Startup gurus Eric Ries and Steve Blank, refer to building a MVP or in our context, Lean Marketplace as “selling the vision and delivering the minimum feature set to visionaries, not everyone.” So it is technically building a viable product and testing it with the set of Innovators and Early Adopters before developing it for the mass.
A common misunderstanding among entrepreneurs is that the MVP or Lean Marketplace refers to a basic model. Although it is partially correct, it is semantically wrong. A minimum viable product has the most basic features which would still solve the problem you are aiming to solve. It is the prototype on which you will test the acceptability of your target audience. So you have to make it appealing to your target audience with the right UI and UX.
As mentioned already, the MVP is supposed to solve a problem. So a MVP or Lean Marketplace is not like Work In Progress but a solution in itself. The MVP allows you to have invaluable insights from your first set of customers based on which you keep building future models.
The Lean Startup outlines the process of building a MVP or Lean Marketplace in 3 steps: Build, Test and Learn.
We have discussed this step in earlier articles of building your MVP; either build from scratch or use a SaaS offering. To give you a brief understanding of the two options; building from scratch is a very customized option which requires more time, more money and an in-depth technical knowledge.
Building a MVP using a SaaS offering is a more economical option. You can create your marketplace website and apps using Online Marketplace Platforms like Yelo.
Platforms like Yelo also offer easy customizations on your marketplace without any technical knowledge. The short go-to-market time makes this a favorable option for building MVP.
While building your MVP, just remember that the minimum viable product is that version of a new product which allows a team to collect the maximum amount of validated learning about customers with the least effort.”
Once you have built the first version of your MVP, you should run it past a Quality Assurance Engineer. If you are building the MVP using an Online Marketplace Platform, all you require is someone with a good eye as the platforms are already tested by QA teams of the respective companies.
The next round of testing is by your first set of customers. Understand how they work around the platform and record their experiences. You can use their feedback to make changes to the platform and test it again. Alpha testing is when you test the solution through your friends and family. If you have already set up a team, ask them to test the platform. Also, see how competitor marketplaces behave. A good comparison would give you a better understanding.
Beta testing is when you subject the marketplace to your first set of customers.
These feedbacks are the most important as they define if people will pay for your product and if the product is good enough to solve the problems. So it is technically a ‘product/ market testing’. This process may take about 2-3 weeks every time you run it. Hence, make sure you gather as many feedbacks as possible to avoid the number of cycles.
Before you begin testing your MVP, it is important to set some objectives and metrics to measure them. For Example, If awareness is your objective, then site traffic would be a metric to measure. Without good metrics, the iteration process would not be satisfying enough.
The more tangible the metrics, the better the validation of the product’s viability. This eventually leads to a better final product as the direction to steer towards becomes clearer in the iteration process.
To Wrap It Up
The above 3 steps can be elaborated to the following 5 steps:
1) Build a minimum model of your marketplace that offers a solution.
2) Set the right KPIs for your MVP
3) Test the model and gather insights
4) Measure the KPIs and make necessary changes
Just remember that minimum doesn’t mean reaching out to Innovators and early adopters with the most basic model you can come up with. If you do only that, you risk losing an opportunity to gain real insights that are beneficial to your iteration process, which is essential to arrive at the best version of your marketplace.