TESTING AND VALIDATING
YOUR IDEA
David R. Miller
PDM7 Instructor
TESTING AND VALIDATING YOUR IDEA
I V E
CO NCE L A N
P O P
EV E L TE
D TI ER A
U N C H
L A AT E
Y S T I N
A D TA
STE I N
MA R KILL
O
TESTING AND VALIDATING YOUR IDEA
LEARNING OBJECTIVES
‣ Determine if product/market fit has been achieved for a product
‣ Explain the purpose and process of building an MVP
‣ Identify various ways to build and learn from an MVP
‣ Evolve an MVP to reach product/market fit
TESTING AND VALIDATING YOUR IDEA
PRODUCT/MARKET
FIT
PRODUCT/MARKET FIT
“THE #1 COMPANY-KILLER IS LACK OF MARKET
… IN A GREAT MARKET — A MARKET WITH
LOTS OF REAL POTENTIAL CUSTOMERS — THE
MARKET PULLS PRODUCT OUT OF THE STARTUP.”
- MARC ANDREESSEN (HTTP://BIT.LY/2XJAPG)
PRODUCT/MARKET FIT
THE SEGWAY
GREAT
PRODUCT
WITH NO
MARKET?
PRODUCT/MARKET FIT
THE SEGWAY
GREAT PRODUCT WITH NO MARKET?
SUPER HIGH EXPECTATIONS
PRODUCT, NOT A SOLUTION
NO CLEAR NEED
INVENTION VS. INNOVATION
REGULATION
PRODUCT/MARKET FIT
MAKE SURE CUSTOMERS
WANT YOUR PRODUCT,
BEFORE YOU BUILD IT.
PRODUCT/MARKET FIT
Build
Learn
Measure
PRODUCT/MARKET FIT
Iterate your way to
Product/Market Fit
YOUR USERS
TESTING AND VALIDATING YOUR IDEA
FINDING
PRODUCT/ MARKET FIT
FINDING PRODUCT/MARKET FIT
FINDING PRODUCT MARKET FIT
DEFINE THE PROBLEM YOU ARE SOLVING FOR THE CUSTOMER
GET IN FRONT OF CUSTOMERS AND VALIDATE YOUR ASSUMPTIONS (MAKE SURE YOU
VALIDATE ASSUMPTIONS BEFORE YOU START BUILDING)
CREATE AN EXPERIMENT TO TEST IF YOUR ASSUMPTIONS ARE TRUE
MEASURE CUSTOMER BEHAVIOR TO SEE IF YOUR PROBLEM IS IMPORTANT TO THE
CUSTOMER - IF NOT, THEN PIVOT
FINDING PRODUCT/MARKET FIT
WHAT ARE YOU TESTING & LEARNING
CUSTOMER RISK: WHO HAS THE PAIN & HOW DO YOU IDENTIFY THEM? (EARLY ADOPTERS)
PRODUCT RISK: HOW WILL YOU SOLVE THESE PROBLEMS & WHAT IS THE MINIMUM
FEATURE SET? (SOLUTION)
MARKET RISK: WHAT IS THE PRICING MODEL? WILL THEY PAY & WHAT PRICE WILL THEY
BEAR? (REVENUE STREAMS)
FINDING PRODUCT/MARKET FIT
“THE ONLY METRICS THAT ENTREPRENEURS
SHOULD INVEST ENERGY IN COLLECTING ARE THOSE
THAT HELP THEM MAKE DECISIONS.”
Eric Ries
FINDING PRODUCT/MARKET FIT
VANITY METRIC ACTIONABLE METRIC
clicks
Visits
scrolling
Pageviews
options on submit
Time on Page
cancel
Downloads
purchases
Registered Users
abandoned carts
FINDING PRODUCT/MARKET FIT
DROPBOX
Problem: It’s hard to manage your files
across systems and computers.
Customer: People who work across
multiple platforms. Ex. Office workers
who need to access files at home.
Riskiest assumption: If we provide an
extremely easy to use product, people
will try it.
Experiment: Video demonstrating ease
TESTING AND VALIDATING YOUR IDEA
MVPS
MVPS 21
MINIMAL VIABLE PRODUCT
THE LEAST AMOUNT OF WORK
YOU CAN DO TO
LEARN THE MOST OF
SOMETHING.
MVPS 22
MVP
MVPS 23
WHY MVP?
REDUCE RISK & MAXIMIZE SUCCESS
FASTER FEEDBACK
REDUCED OVERHEAD
MEASURABLE PROGRESS
“MOST CUSTOMERS ARE GREAT AT ARTICULATING PROBLEMS
BUT NOT AT VISUALIZING SOLUTIONS” Ash Maurya
MVPS
YOU DO NOT NEED
TO CODE TO TEST
SOMETHING.
MVPS 25
TYPES OF MVPS
‣ Concierge
‣ Wizard of Oz
‣ Landing Pages
‣ Videos
MVPS
CONCIERGE
‣ Delivering a service
manually to the customer.
‣ Ex: Groupon, Virgin
America
MVPS
WIZARD OF OZ
‣ Everything appears to be
real to the customer, but
on the back end it is
manual.
‣ Example: Zappos
MVPS
LANDING PAGE
‣ Used to see how much interest there is in the idea.
‣ Remember: you need to drive traffic to the site!
MVPS
VIDEOS
‣ Used to demonstrate a hard
concept.
‣ Can be pieced together without
the technology being
completely in place.
‣ Ex: Dropbox
MVPS 30
WHAT DO YOU NEED TO
KNOW BEFORE YOU
CREATE A MINIMAL
VIABLE PRODUCT?
MVPS 31
WHAT DO YOU NEED TO KNOW BEFORE YOU CREATE A
MINIMAL VIABLE PRODUCT?
REFINE YOUR ASSUMPTIONS
& PRIORITIZE
MVPS 32
WHAT IF YOUR
HYPOTHESIS IS WRONG?
PIVOT, LEARN, AND ITERATE.
ACTIVITY
KEY OBJECTIVE(S)
Design and MVP for a wine delivery on-demand app.
TIMING
10 min 1. Split up into groups. State the problem
EXERCISE and customer you are solving for.
5 min 2. List your riskiest assumptions.
15 min 3. Design an MVP to test if people will
want to use your application. Bonus if it
involves no code.
DELIVERABLE
The details of an experiment you would run to test your idea, and what you
would measure.
MVPS 34
MVP'S NEED TO BE:
REALIZABLE
LOOK REAL
QUICK TO ITERATE
MINIMIZE WASTE
USE REAL LOOKING DATA
TESTING AND VALIDATING YOUR IDEA
HOMEWORK
TESTING AND VALIDATING YOUR IDEA
CREATE AN EXPERIMENT TO TEST YOUR IDEA
Write out:
‣ What is the problem you are solving?
‣ Who is your customer?
‣ What is your riskiest assumption?
‣ How would you test that riskiest assumption?
‣ What would you measure!
Run your experiment and tell us the results!
TESTING AND VALIDATING YOUR IDEA
Running Lean by: Ash Maurya
TESTING AND VALIDATING YOUR IDEA
SAMPLE SOLUTION INTERVIEW SCRIPT
‣ Welcome (set the stage) - 2 min
‣ Collect Demographics (define customer segment) - 2 min
‣ Tell a story (set problem context) - 2 min
‣ Demo (test solution) - 15 min
‣ Test pricing (revenue streams) - 3 min
‣ Wrapping up (follow up, referrals, sign up) - 2 min
‣ Document results - 5min
TESTING AND VALIDATING YOUR IDEA
WHAT DOES SUCCESS LOOK LIKE
‣ Can identify the demographics of an early adopter
‣ Have a must-have problem
‣ Can define the minimum features needed to solve this problem
‣ Have a price the customer is willing to pay
‣ Can build a business around it (market sizing, cost vs. revenue)
TESTING AND VALIDATING YOUR IDEA
TOOLS
‣ Pencil & Paper ‣ Marvel App
‣ MS Powerpoint ‣ Various video
‣ Apple Keynote recording devices
‣ Axure
‣ Sketch
‣ Balsamiq
‣ Adobe Photoshop
‣ Adobe InDesign
PRODUCT DEVELOPMENT LIFE CYCLE
Q&A
PRODUCT DEVELOPMENT LIFE CYCLE
EXIT TICKETS
HTTP://GA.CO/PDMTICKET
1. What is a Minimum Viable Product?
1. A version 1 of your product
2. The smallest amount of work you can do to learn something - A
3. A full functioning app
2. True or False: You need to code to be able to make an MVP.
1. True
2. False - Answer
3. Which is an example of an actionable metric?
1. Page Views
2. Purchases - Answer
3. Time on site
