5 myths debunked about the marketplace MVP
Are you familiar with the term MVP? This acronym, which has become trendy in the tech world in the past few years, refers to Minimum Viable Product. This is a method whereby project developers come out with an initial product featuring only the functions most demanded by its target audience, in order to test its market as early as possible. A few years ago in a client meeting with a large European aviation company, as I was singing the merits of this method, someone dampened by enthusiasm by saying: “Do you really think it makes sense to make an MVP for our next long-haul plane?” And while this method can’t be applied to each and every project, it would be wrong to think it is incompatible with complex endeavours. A good example is the use of this method to launch a marketplace. Let’s try to debunk a few myths on this topic!
Aren’t MVPs and marketplaces contradictory?
In their essence, marketplaces offer a wide range of functions: vendor account creation, purchase funnel, multi-seller cart, seller back office to manage orders, online payment system, breakdown of commissions, etc. This breadth of functions could kill any hope to be able to launch an MVP which, in its essence, is reduced to its most basic functionalities. However, open-source and proprietary frameworks exist today that can quickly develop these functionalities via fairly simple configurations. The challenge, then, is no longer the development itself but having a clear idea of where you want to take your marketplace project. It’s also about deciding, bearing the MVP method in mind, to which product or service category, countries, etc, you want to limit your marketplace MVP. The time will come at a later stage to refine functionalities and develop new ones.
A marketplace MVP is useless!
I’ve often heard this argument, mainly from the same people who thought a marketplace MVP was impossible. Like all MVPs, marketplace MVPs are very useful in two fundamental ways. First, they give you the tools to start onboarding your first sellers, one of the key assets of your marketplace. Successful onboarding is a significant precondition to the success of a marketplace’s launch, and the only way to test it is to operate it on the back of an MVP. Some of the marketplaces I know launched an MVP first with this sole purpose. The other advantage of the MVP is that it allows you to run your first end-to-end transactions and uncover unhappy flows, those exceptional cases that are hard to anticipate in the project development phase and can lead to unforeseen events as the MVP goes into production. Discovering potential issues early enough in the project allows you to increase the perceived added value of your marketplace for clients, and differentiate yourself from competition.
A marketplace MVP makes you dependent on one framework!
This is a make or buy decision. Sometimes, relying on someone else’s framework can be interesting to accelerate time to market for a marketplace project. In a competitive market, it’s a good way to come out first. Some marketplace project developers are reluctant to this idea because the framework does not constitute an asset for their company (IP in startup language). This could be a valid argument if choosing a framework was a permanent decision. However nowadays, orchestration solutions such as Marjory (a little self-promotion never hurt anyone) can help operators become less dependent on the frameworks they rely on to build and run their marketplace. If you think in terms of platforms, microservices, API connections, orchestration, workflows, etc, the dependency argument stops making sense, because changing frameworks or integrating custom solutions becomes easy!
It takes a very long time to launch a marketplace MVP.
Time is relative. It all depends on when something starts and when it ends. By nature, launching a marketplace MVP can take a long time if you start from a blank canvas. If you count the development of a strategic positioning (value proposition, client profile, catalogue structure, etc) and of a business plan, then yes, an MVP can take some time. But if these scoping elements have already been decided, it is possible to launch a B2C marketplace in 3 months — I can confirm that. Why? Because orchestration solutions such as Marjory, which offer off-the-shelf best practices, pre-integrated module libraries and intuitive workflow editors, allow operational profiles to build a marketplace MVP in a low-code manner!
MVPs are very expensive!
It’s always taboo to talk about money, which is why I kept this topic for last, as a polite young man! Trying to give a price range is always risky. And that’s the main thing, right? How much will it cost? In a competitive world where new marketplaces are launched every day, being first to pull the trigger is a significant advantage, even if it costs a little more. It’s also important to get your MVP ready quickly (see the previous myth). By leveraging open-source and proprietary solutions, an orchestration tool and the advice of experts, you can launch your marketplace MVP for less than €100k.
Are you convinced yet?
The MVP method may not bring about the next airline revolution, but it certainly will contribute to the transformation of trade, by allowing startups and established companies such as retailers to quickly demonstrate all the power of the marketplace model. Let that be clear!
Written by Alexandre AMIOT on Linkedin the 01/21/2021 taken up and translated with his authorization