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Many start-ups fail because they develop a product that is not in demand on the market. But how can you find out early on whether your idea has potential? The answer lies in the Minimum Viable Offer (MVO) approach. In this article, you will find out how the MVO approach works, who it is suitable for and which companies have already used it successfully.

Minimum Viable Offering - to the point:

• Every startup business model has three inherent product risks: Value Risk (is the offering valuable to our target audience?), Feasibility Risk (is the offering feasible and scalable?) and Usability Risk (can users quickly access the added value?).

• An MVO Smoke Test helps to minimize the value risk before investing in development

• The MVO approach is purely marketing-driven and validates demand, while an MVP tests technical feasibility

• Examples of successful MVO Smoke tests are Dropbox, Buffer and Zappos

Why is the MVO approach important?

Many start-ups fail because they develop a product that nobody needs. With an MVO Smoke Test, you can find out at an early stage whether there is demand for your offering. This saves time and resources that would otherwise be spent on developing a non-marketable product.

How does an MVO Smoke Test work?

A minimum viable offering is a purely marketing-based opportunity to test the riskiest element of your business model: the value for the customer (value risk). Examples of MVOs are a "Coming Soon" landing page, a pricing page with different packages, advertisements that lead to a landing page or a simulated purchase process.

The aim is to measure genuine customer interest and engagement even before the actual product exists. This is how Dropbox (viral demo video), Buffer (manual service provision for first customers) and Zappos (putting photos of shoes online before the purchase) have done it.

The steps of a smoke test are

1. Define hypothesis and metrics

2. Design an experiment without development effort

3. Bring qualified traffic to your experiment

4. Measure the defined metrics

5. Analyze the results and optimize iteratively

6. Make a decision and move on

Your biggest competitive advantage is speed. The faster you can validate your riskiest assumptions, the faster you can build something that customers really want. If your first smoke test doesn't work, it's because of your execution - be it too broad, unclear or otherwise. Failure here is not failure, but valuable learning.

Conclusion

An MVO Smoke Test is a powerful tool for any startup to minimize the biggest product risk - lack of demand - right from the start. Thanks to the marketing-oriented, non-technical approach, you can quickly obtain real customer feedback and iteratively optimize your offering until you achieve a product-market fit. Only then is it worth investing in the actual product development. Examples such as Dropbox, Buffer and Zappos show that this approach has proven itself in practice many times over.

Deep dive: Minimum Viable Offer (MVO) vs. Minimum Viable Product (MVP) - When does which concept make sense?

In recent years, two concepts have become established in product development in order to obtain market feedback on new ideas as quickly and efficiently as possible: the minimum viable product (MVP) and the minimum viable offer (MVO). But what are the differences between the two approaches and for which use cases is which concept best suited? This article provides an overview.

The minimum viable product (MVP) is a functional prototype that contains the core functions of a product. The aim is to create an initial marketable version with minimal effort in order to obtain user feedback as quickly as possible. This allows hypotheses to be tested and the product to be iteratively improved.

The MVP is particularly suitable for products where the basic feasibility has already been validated. It also requires a dedicated development team that can implement the MVP in a short space of time. Start-ups with a technical founding team therefore like to use this approach.

In contrast, the Minimum Viable Offer (MVO) does not focus on feasibility, but on the benefits for the target group. Instead of building a functional prototype, a convincing offer is formulated that arouses the target group's curiosity. This offer is presented via a landing page, for example, combined with a call to test the product.

The aim is to check how many interested parties the offer appeals to and how willing they are to try out the product. This makes it possible to find out very quickly and without great effort whether the product promises added value for the targeted users.

The MVO is therefore particularly suitable at an early stage, when it is still unclear whether the product idea has any potential at all. It is also a good starting point for individual founders and teams without technical expertise. This is because it allows the value proposition to be validated first before investing in development.

Which approach is best and when depends on the stage and resources of the product team. For some ideas, it makes sense to start with an MVO and build an MVP later. In other cases, such as with very innovative technologies, an MVP may be the better choice straight away.

No matter which variant you choose: Getting feedback as early as possible is the key to developing products that are successful on the market. Both MVO and MVP are valuable tools in this process.

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Let's summarize the most important findings once again:

• Every product idea involves risks - the biggest is building something that nobody needs. You can minimize this "value risk" right from the start with an MVO Smoke Test.

• In contrast to a minimum viable product (MVP), which tests technical feasibility, an MVO purely validates demand - without any development effort.

• Companies such as Dropbox, Buffer and Zappos used this method to measure genuine customer interest at a very early stage and built their offering around it.

• The steps of an MVO Smoke Test are: Define hypothesis, design experiment, generate traffic, measure metrics, analyze results and iteratively optimize.

• Speed is the key advantage - the faster you can test your riskiest assumptions, the sooner you will find a product-market fit.

• An MVP tests the technical feasibility, while an MVO validates the demand.

• For teams without technical expertise or in a very early phase, an MVO is often the better starting point. If the focus is on an innovative technology, an MVP may be the better choice.