Differences between Minimum Viable Product (MVP) and Minimum Business Increment (MBI)

Building a successful product is a long process; it requires clear strategies and smart decisions. Among the many concepts to consider, MVP and MBI are two key terms that can significantly improve your product development plan. 

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In this blog, we’ll go over what MVP and MBI mean, explain how they differ, and cover how to use each strategy effectively.

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What is MVP?

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MVP stands for Minimum Viable Product. It is the simplest version of a product that can be released to users. An MVP includes only the basic features needed to solve a specific problem for a target audience.

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An MVP is designed to be simple. It only contains the features necessary to solve the main problem, avoiding any extras. The goal is to develop the product quickly, allowing businesses to gather user feedback early. This feedback helps in making improvements based on real user experiences. The MVP approach also requires a minimal investment of time and resources, making it cost-effective.

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The main purpose of an MVP is to test assumptions. By releasing a simple version of the product, businesses can see if the product idea appeals to users. It is a way to learn from users and use their feedback to make the product better over time.

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Example of MVP

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Here is a practical example of how an MVP would work in a real-world context, particularly for a project management tool.

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Core Features: The MVP might include basic functionalities like task creation, assigning tasks to team members, and tracking progress. The goal is to create a simple interface where users can manage their projects without any complex features.

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Launch: The tool is released to a small group of users, such as a few teams within a company, to test its usability.

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Feedback Gathering: After using the MVP, users are surveyed about their experience. They provide feedback on the basic functions and mention that they find it challenging to see an overview of all projects at once.

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By launching the MVP in this way, the developers realize that their product needs a feature that allows users to see an overview of all projects in one place. They can now focus on adding this important functionality. If they had waited until completing the entire project and launching it publicly, they risked making a poor first impression by missing this key feature.

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What is MBI?

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MBI stands for Minimum Business Increment. An MBI is the act of adding small, valuable changes to the product that add business value. It is a way for businesses to deliver value incrementally to the customer, without delaying the release for too long.

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An MBI targets business goals. Each increment is carefully planned to align with broader business strategies, ensuring that every step contributes to the overall plan. MBIs are built to be scalable, meaning they can be expanded or built upon in future increments. Each increment is expected to show a clear impact on business metrics, such as increasing user engagement, boosting sales, or improving efficiency.

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The main goal of an MBI is to add business value. By focusing on specific features that directly contribute to business goals, MBIs help manage risks and use resources efficiently. This approach allows for continuous improvement and adaptation to changing business needs.

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Example of MBI

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Let’s use the project management tool as an example once again. This time, let’s see how we can use MBI to improve it for customers.

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First Increment (MBI 1): Based on the feedback from the MVP, the first MBI might introduce a dashboard feature. This allows users to see an overview of all their projects in one place. The focus is on improving the user experience by addressing the pain point identified in the MVP feedback.

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Measurement of Impact: After releasing this MBI, the team monitors key metrics like user engagement and satisfaction. They find that users spend more time in the tool and report higher satisfaction rates.

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Second Increment (MBI 2): Following the success of the dashboard feature, the next MBI could add integration with popular calendar apps. This enables users to sync deadlines with their calendars, making the tool even more valuable.

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In this way, MBIs can provide small, measurable upgrades to an existing product that can help boost customer satisfaction and improve your overall product.

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Difference between MBI and MVP

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MBI (Minimum Business Increment) and MVP (Minimum Viable Product) are both important parts of product development, but they have different goals.

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An MVP is a basic version of a product created to test an idea with real users. Its main goal is to determine if there is a market for the product and whether it can address customer problems. By launching an MVP, businesses can collect valuable feedback from early users, helping them make informed decisions about future developments.

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On the other hand, MBI focuses on adding features that provide real business value. After gathering proper user feedback, MBI aims to improve an existing product by introducing new functions that help the business grow and succeed. The goal is to build on what already exists and make sure each new feature not only improves the product but also contributes to overall profitability and market competitiveness.

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In summary, MVP is about testing ideas and understanding users, while MBI is about improving the product to reach specific business goals.

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Using MVP and MBI for Best Results

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MVP (Minimum Viable Product) and MBI (Minimum Business Increment) serve different purposes, but they can work together and complement each other well in product development. Here’s how to combine both approaches for the best outcomes:

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1. Start with an MVP

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Begin by developing a Minimum Viable Product (MVP) to validate your product idea. This involves:

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• Identifying Core Features: Focus on the essential features that address a specific problem for your target audience.
• Launching Quickly: Release the MVP to gather early feedback and understand user needs without extensive delays.
• Gathering Feedback: Use user input to identify strengths and areas for improvement, helping you refine your product concept

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2. Transition to MBI

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Once you have validated the MVP, shift your focus to Minimum Business Increments (MBI). Now, your focus should shift to adding features that add value to customers. You should:

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• Set Clear Objectives: Define specific business goals, like increasing user engagement or boosting sales.
• Deliver Incrementally: Roll out small, valuable increments that improve the product based on user feedback and business needs.
• Measure Impact: Analyze how each increment affects your business. Use tools to track information such as user retention, conversion rates, and overall sales after each release.

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3. Improve Continuously

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Ongoing improvement is key for success in product development. This means regularly refining and upgrading your product based on user feedback and performance data:

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• Feedback Loops: Always collect user feedback to shape future updates. Set up ways to get user opinions through surveys, feedback forms, and usability tests.

• Track Key Metrics: Always track important information such as user satisfaction and business success. Review metrics like customer acquisition costs, engagement rates, and revenue to document and analyze how your product is performing.

• Adapt as needed: Stay open to adjusting your approach based on user feedback and market shifts. If users ask for new features or improvements, prioritize those in your development plan. Being flexible helps your product stay relevant and competitive.

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Apart from MVP and MBI, there are other steps in the product development process that help with user attraction and sales potential. Concepts like Minimum Marketable Feature (MMF), Minimum Marketable Release (MMR), Minimum Marketable Product (MMP), and Product-Market Fit (PMF) are also used when planning out product releases. Knowing these terms can improve your strategy and increase your chances of creating a successful product.

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Conclusion

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MBI (Minimum Business Increment) and MVP (Minimum Viable Product) are both important in product development but serve different purposes. To make the most of your product development process, learn how to use MVP and MBI in your strategy. By understanding these concepts, you can better test your ideas and add features that users will value. Start using these approaches today to improve your product’s success!