The Lowest Cost Viable Product

Project FB – Update.

So recently we have completed what I would describe retrospectively as the nice, exciting, and even easy parts of starting a business.  We have done the brain storming, looked at the opportunities and evaluated them, come up with the ideas and concepts.  Finally having considered all of this, we have said OK – this is our product, our idea, our brand.

It has several advantages.  The product sits in a category that has been highly commoditised, so we can offer a premium alternative and refresh the market. The product does not currently seem to exist in a premium fashion; it isn’t like producing another niche beer, another premium meat pie, or another special cake.  So everything sounds like a good opportunity exists, but this is where the challenges really lie.

How does one go about converting the idea into a tangible product at low cost to gauge consumer feedback?  I have read a lot recently about a concept called “the lowest cost viable product”.  In essence this is saying, what are the bear essential aspects, ingredients, or materials that are needed to produce something that can be used to gauge consumer opinion?  Whilst this may sound like just a sensible approach to buying an initial proto-type it is actually a much deeper thought than that.  This is because it fights in the face of a person’s natural tendency to want the product to be received well and therefore engineer in un-necessary and costly attributes that are not needed or perhaps not relevant to the consumer or customer.  The challenges we have faced include under pricing the product and being too easily moved into reducing the price point, over packaging the product to give a premium feel, providing un-necessary marketing support material, a tendency to rush the flavour development process, and a drive to bring too many flavours to market too early.

My learning from the process is simple but very valuable.  Use other people to sense check what you believe to be essential purchases or aspects of a proto-type.  Don’t assume you know what the consumer expects, start bare and then work up if you need to.  Resist calls to lower price at least until you have let real consumers have their say.  And be comfortable with accepting you may still be working with a proto-type even when others start to think of it as a finished product – keep listening and refining.

The next challenge…. if we have a brand and product that people like….. can we build a business model that is robust?

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