April Dunford just presented Startup Marketing 101 at DemoCamp Toronto. Great ideas from the ‘marketing and your startup’ point of view. I’ve often said that product managers and product marketers care about much of the same market data, they just do different things with it. The idea of minimal feature set came up in April’s presentation – this article talks about product management, agile, and initial market acceptance.
Initial Market Acceptance and Minimum Market Acceptance
April mentions (in slide 4) that an important event to the timing of marketing activities is achieving the “_minimal feature set (for certain markets)_.” April organizes those marketing investments in terms of three stages of “product marketing lifecycle”:
- What to do when your startup has a “pre-product” product.
- Where to focus when you’re focused on early adopters.
- How to invest in your marketing programs when your focus is on scale / growth.
Coming from an agile background, I think about two distinct notions of “minimum” or “initial” when it comes products and markets. The following definitions are in a B2B context, as I’ve been focusing on this recently with a client in the B2B space. The same ideas are relevant to B2C and B2B2C companies, but the language would be slightly different.
- Initial market acceptance: set of addressed problems that at least one customer in your target market is willing to pay to solve.
- Minimum market acceptance: set of solved problems that enough of your customers in your target market are willing to pay to solve, that determines “minimum success” for your product strategy.
I’m assuming that when April used the phrase “minimal feature set”, she was really talking about “minimum market acceptance” in the way that I’m describing here. The distinction is that features describe what a product does, which is an inside-out view of the product. To be market focused, you have to think about which market problems are being solved, for whom they are solved, and how well they are being solved – an outside-in product view.
If you focus on, and organize around your features, you are likely to miss the mark. You must focus on the problems that your customers need to solve. In your product, you will prioritize the development of capabilities (embodied through features) that are designed to help your customers (buyers and users) solve their problems. Your market analysis should be geared around understanding how many customers in each segment face each problem, and how much they are willing to pay to solve those problems.
Agile or Waterfall or Waterfragile?
As an agile product manager, and former developer, I know that when you do “everything we need to be successful” in the first release, you’re not being agile – we’re being waterfall. A slight extension of this is “everything we need to be minimally successful” – and that is still waterfall.
An agile team should focus on the first release addressing the initial market acceptance criteria – the minimal set for a single customer. The goal is to get the product in front of customers as soon as possible – this starts your revenue stream earlier, gives you valuable market feedback, and gives you the opportunity to establish momentum through repeated incremental releases of your product. Each release will solve addressed problems “better” and / or address additional problems, until you reach minimum market acceptance.
Kano Analysis for Understanding Problems
Last year, I was thrilled to share my approach for applying Kano Analysis as a product manager with the PMV webinar audience as well as the Austin IIBA chapter. One of the key ideas in the application of Kano Analysis to understanding your market is developing the personas within that market, and understanding how each of them treats each problem / capability.
This analysis, in addition to being useful for understanding the market (or a segment) as a whole, also helps you identify your first customer. Once you know who your first customer is, you can determine the initial market acceptance criteria for that customer, and that determines the must have capabilities.
Note that finding the initial solution (that the first customer will buy) does not mean releasing a poor quality product – it just means releasing a product that solves enough problems (well enough) for one customer. With the feedback from that customer, you can drive the prioritization for your next iteration – making the next iteration better for that customer (which can really help your word of mouth), and gaining more customers. Repeat this process until you get to minimum market acceptance.
Timing Marketing Investments for Minimum Market Acceptance
Since I wasn’t at April’s presentation, I don’t know exactly what she would think of the following, but I believe it makes sense:
- Initial Market Scceptance (one customer would buy your product) marks the transition from pre-product to early adopters.
- Minimum Market Acceptance (enough to succeed in the market) happens before the transition from early adopters to scale. Note that it may not (probably doesn’t) mark the transition, but I suspect happens mid-stream.
Would love to see what other folks think about mapping this product management centric view to the marketing timeline. Please chime in below.