A SaaS MVP can offer a huge advantage in today’s competitive market.
Specifically, it can help accelerate the time it takes to launch your product to the market, validate your idea, and increase revenue.
But you can only reap these benefits if you build a successful MVP. And, unfortunately, developing a SaaS MVP that stands out and meets the needs of your target audience can be challenging.
Developing a successful MVP for SaaS requires extensive market research, staying within budget, and testing your product rigorously, all of which can be time and energy-consuming.
This is why it’s important to know all the ins and outs of SaaS MVP development.
And we are here to help with just that.
In this article, we will explore the benefits, costs, and 8 steps you need to take to develop a SaaS MVP in 2023.
SaaS MVP development involves building the initial version of your business' software with basic features and functionalities. It is marketable and has enough features for early adopters to test it and offer feedback.
Building an MVP allows SaaS businesses to validate a product idea without investing too heavily in it and make informed decisions about the future direction of their product.
Overall, developing an MVP for your SaaS project is an essential part of the SaaS development lifecycle.
For example, suppose a business wants to build a SaaS project management platform. In this scenario, the MVP may include basic features such as assigning tasks, setting deadlines, and tracking progress tracking.
Based on users’ feedback on those core features, the company can then plan to add new features and make any necessary changes to existing ones.
In addition to testing how the product performs in the development stage, the feedback about the MVP can also help validate if there’s enough demand for the SaaS project management platform in the market.
The SaaS market is currently experiencing rapid growth and is expected to continue expanding in the future. According to a press release from the Globe Newswire, the global SaaS market stood at $16.53 billion in 2022 and is said to reach $462.94 billion by 2028.
Another report by Grand View Research shows that the growth is expected at a compound annual growth rate (CAGR) of 13.7%. The increasing adoption of cloud-based technologies, the rise of remote work, and the need for cost-effective and scalable software solutions drive this growth.
The rapid expansion of the SaaS market, however, has also significantly increased the competition in the SaaS space.
In this context, an MVP can be a valuable tool for SaaS businesses looking to enter the market and establish themselves as players in the industry.
By serving early adopters with core features and functionalities, SaaS MVP can offer many benefits to SaaS businesses, starting with:
Building a SaaS MVP is beneficial and rewarding, but only if you do it the right way.
Here are the steps you need to take for SaaS MVP development:
The first step in building a SaaS MVP is doing competitive research. This will help you understand the industry and your competition better to create something unique and valuable.
Here are some ways to get started with competitive research:
Competitive research is vital to ensure there is demand for your product and develop something unique from what’s already in the market. If your product is not a good fit for your target audience, there’s no point in going ahead because it will ultimately lead to failure.
Here’s an example you should consider.
Ansaro was a SaaS platform built to use AI and data science to improve the interviewing process. Basically, the platform tried to ensure quality hiring, but since the Return On Investment (ROI) was very slow, many recruiters never felt the need to use the product. In turn, Ansaro was shut down in 2 years since there was no demand for it.
The next step in SaaS MVP development is understanding your customers' pain points. This can be done through surveys, interviews, and other research methods.
You should also use feedback from users who have signed up for early access versions of similar products if available. This will help you understand the challenges customers are facing when using your type of product and give you a chance to address them through your solution.
Understanding customer pain points will help you prioritize features and understand what will resonate with them most. Try to identify what they struggle with the most and what they feel that is missing from existing solutions, and include that functionality in your product.
Once you get a better idea of what your target audience expects from your product and what your competitors are doing, it's time to think about how you'll profit from your MVP.
This is where your business model comes in.
A business model is how a company generates revenue; the most common business models include:
Moreover, you should also decide whether to build a web app MVP, a SaaS mobile app MVP, or both. Based on your decision, you will have to hire the right development team.
Transpose, an information management platform, is an example of what happens if your pricing strategy is incorrect.
The Transpose platform was meant for all users, but only companies would pay for business-centric features. That’s why the startup shifted focus to businesses and introduced a pricing model.
But it was too late and the company had to shut down in December 2016 due to low revenue resulting from its poor pricing model strategy.
It provides a high-level overview of the product's direction and key milestones over a specific period and helps you prioritize features, stay on track, and use your resources efficiently.
A good roadmap will answer some of these important questions:
In a SaaS product roadmap, you will outline everything you have planned for your product. This includes all the features you want to add to your SaaS product, your short and long-term goals, when to launch new product releases, and more.
A product roadmap also includes the technology stack you’ll use to build the SaaS product. Here, you will need to decide on the SaaS development framework you want to use and the front-end and back-end technologies for building the SaaS product.
Before you start developing the MVP, you need to define its core features.
For instance, suppose you are building an MVP for a task management app. In that case, features like task creation, collaboration, and notifications are some crucial features that you should include in your MVP.
The key in SaaS MVP development is "minimum." You don't want all of your SaaS ideas crammed into one product release. Instead, try narrowing down on just one or two core features that could attract early adopters that will likely continue using your application!
This is where feature prioritization comes into the picture.
Prioritizing features based on the value they bring to your customer is an important aspect of product development, and you'll want to keep this in mind as you build out your MVP. You can use many feature prioritization frameworks to see what features are a must to include in your MVP.
The next step is to develop your MVP.
Since the MVP will be the first version of your product and your chance to make a great first impression on users, you must have a skilled team at your disposal to bring your idea to life.
There are three types of development teams:
The development team should also have the right expertise to meet your project’s specific requirements. For instance, based on whether you want to have a web app or a mobile app, you can choose to go with a web application development agency or a mobile app development company.
If you don’t have the right team working on the MVP, it will likely fail, just like REPitchbook. During his interview with Failory, Charlie Reese, the founder of REPitchbook, said that he developed the MVP on his own with his newly acquired coding skills, resulting in a horrible user interface.
Early users could not understand how to use the SaaS app, which led to the SaaS application development eventually failing.
So you must hire the best team made up of app designers, custom software developers, and testers.
The core task of an MVP is to introduce your product in the market and get feedback for the same. But to get enough feedback you will first need to attract potential customers to try your app.
This is where marketing comes in handy.
With the right marketing, you can generate hype around your product before it’s launched. This will attract users who can then give you feedback about the product.
Here are some ways to market your product:
After you've launched your MVP, it's time to gather customer feedback and use it to add new features and improve the product.
The best way to do this is by creating a feedback loop that allows customers to give you their thoughts on the product and how well it serves their needs.
Ask them what they like and don't like and how they would improve the product. And, if you are not sure about what features to add next, ask them about that too!
You must consider their suggestions and iterate on your product based on this feedback. Don't be afraid to change your product if one feature does not work well enough for your customers or if another feature looks more appealing than expected when implemented in practice.
Ignoring customer feedback can lead to your SaaS product’s failure. Take the example of Eventloot, a SaaS platform for wedding planners.
Justin Anwanyu, the founder of Envetloot, said that he and his team made assumptions about what customers needed and never asked them to give feedback on the platform. This led to the platform's failure because it didn’t have the core functionalities required by customers, leading to a $20,000 loss.
Building an MVP is many SaaS companies’ product development. But there are many things you need to know before starting to build your MVP, including:
The first thing you need to know about building an MVP is that you should not wait too long to launch it.
You can always modify the MVP later on. But starting with something users will find useful and getting feedback from them as soon as possible will help you make better decisions about what features and design elements users need and expect the most.
The more time passes without getting this information, the less likely it is that you'll be able to get good results from testing different iterations of your app or website. There are many ways to quickly reduce time and prepare your SaaS MVP.
For instance, you can hire a software development company if you don’t have an in-house team and you don’t trust a freelancer to do the job.
One of the most important things you can do when building your MVP is to cut the scope in half.
This means that instead of trying to build everything at once, you should focus on just a couple of core features that are musts for SaaS MVP development.
If features or functions in your MVP aren't core requirements for its success, they should be cut until they become part of another iteration or later version.
This will ensure that you get early feedback about the most critical features of your SaaS app and that you can optimize those first, before moving on to secondary ones.
Marketing is a simple process, especially if you hire marketing professionals who can leverage some predefined marketing strategies.
That said, marketing your product can get challenging in a competitive market. If your product is targeting the same audience as other SaaS MVPs, then you can rest assured those MVPs are being marketed, too.
That's why building a landing page for your MVP is important, as well as using social media and search engine optimization (SEO) to drive traffic to that page.
There are several other ways you can market your SaaS MVP:
Without marketing, even good SaaS products can fall short. Most people assume that good products will sell themselves, but that’s not the case. Regardless of how good your product is, it is vital to get the word out there, or else it will fail, just like Habitual.
During an interview with Failory, the founder of Habitual shared that lack of marketing was the most significant reason behind the platform’s failure.
The feedback for your SaaS MVP might get overwhelming, especially if you count the negative comments that you’re also likely to receive.
However, what should really worry you is not getting any feedback at all.
Positive or negative, feedback shows that people are interacting with your product. So if they are not happy with something and they let you know about it, you can improve that part of your product and make it the best version it can be.
Once you have a version of your product out there, you need to listen to what customers are saying and adapt accordingly. They aren't always right, but they are the most important people in your business at this stage.
Don't be afraid to make changes based on customer feedback or even incorporate some completely new features based on user requests. You must especially focus on new features that will likely improve the experience for everyone using your SaaS MVP.
It's also important not to take this process personally.
It's easy for entrepreneurs who have been working so hard on something that they care deeply about to get defensive when others criticize their work or offer suggestions for improvement instead of praise for what already exists!
Want to learn how to build a SaaS product from scratch? Check out our article!
SaaS MVP cost can range anywhere between $25,000 to $120,000. The SaaS MVP development price ranges widely because of the many factors that can drive the costs.
Here are some of the common factors that may influence the cost of your SaaS MVP:
Here are some examples of top SaaS MVPs of popular companies worldwide:
Founded in 1975, Microsoft Corporation used BASIC, a programming language, to develop the Altair personal computer. IBM then asked Microsoft to produce an operating system for its first personal computer. That’s how the journey started.
Based on customer feedback and demands, Microsoft’s products now include operating systems for computers, servers, productivity & business solutions, etc.
IBM’s Watson Assistant is another example of a custom software MVP.
Watson Assistant is a chatbot platform that can help create virtual assistants for various industries and use cases.
The MVP for Watson Assistant included basic natural language processing capabilities, pre-built integrations with a handful of third-party services, and a web-based dashboard for managing and training the chatbot.
Dropbox's MVP was a simple online file storage and sharing service that allowed users to upload their files to the cloud and share them with others. The MVP was launched in 2008 and had a simple user interface that was easy to use.
The core feature of Dropbox's MVP was its ability to synchronize files between multiple devices. Users could install the Dropbox software on their computer or mobile device. The MVP wasn’t a success in its first few attempts. But Drew Houston kept improving the MVP based on feedback and made it successful.
Spotify is a SaaS-based online music streaming platform that started in 2008 with its first MVP. The MVP focused on providing users with a simple and intuitive music streaming experience. It featured a search function that allowed users to find and stream music by artist, album, or track.
Spotify slowly expanded its MVP and added features like the premium version, song sharing, playlist creation, offline download, etc. By following the right steps for SaaS MVP development, Spotify entertains 515 million music lovers across 180 markets.
Developing a SaaS MVP in 2023 can be daunting, but with the right approach, it can be a relatively straightforward process. At MakeITSimple, we have helped numerous startups and businesses develop their MVPs and final SaaS products.
Our developers understand the SaaS MVP development process and can help develop an MVP that meets the unique needs of your business.
Whether you need a SaaS web app, mobile app, or custom software solution, we offer inventive solutions that can assist you in achieving your business objectives.
Get in touch now for a free consultation.
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