Wise blog_Business efficiency in 2023 (2).svg

Product scaling

Startups

How to set up business activities on a high level correctly and build operational processes that will bring value with time? Of course, each business case is unique, and there is no one-fits-all solution. Nevertheless, we believe there are some common tendencies. In this post, we've assembled a list of business efficiency tips that will help you accelerate growth in 2023–2025.

The key to improvement is knowing how to actually approach business efficiency. In this article, we'll bring more clarity to this topic. Let's go!

## Business efficiency versus business effectiveness

Achieving business efficiency is impossible without achieving business effectiveness, and vice versa. The problem is that these two concepts are often used interchangeably, but they imply different meanings altogether.

- **Business effectiveness** is the external standard of performance; it focuses on meeting the demands of your customers. Effectiveness is when what you do and the service you provide to the customers work well and successfully, and the customers are satisfied with what they receive. That is, it is customer satisfaction.
- **Business efficiency** is an internal performance standard. Once you understand your effectiveness measures and demands, efficiency is meeting those demands as quickly and cost-effectively as possible. Thus, it is self-satisfaction because you spend a sufficient amount of your resources and do not use them in vain.

As you can see, effectiveness and efficiency are like two puzzle pieces that should be considered and balanced correctly.

A business can be considered efficient if it uses its resources in the best way for both its employees and its customers. That is, it pleases a customer in the most efficient way possible. For example, you don't have extra processes or anything that takes time. Instead, you have a system that works well and is properly tuned and optimized to give your customers what they want.

## How to improve business efficiency in 5 steps

Whether you're just starting out or have a well-established business, increasing business efficiency is critical. By increasing business efficiency, you will be able to better utilize your resources, uncover patterns in operations, streamline processes, and cut expenses. Here are business efficiency tips to help you get started.

![ bets business efficiency tips ](https://wise-site.fra1.digitaloceanspaces.com/Improve_business_efficiency_in_5_steps_aec56c0c4d.svg)

## Step 1: Measure what you have

The first logical step is to know the level of your current efficiency. Define efficiency for your case and in your particular environment. How well does your business operate and correspond to these criteria? Are there any weak sides? To answer this question, you can use some of the well-known metrics that help to understand your efficiency and how your organization is doing today.

- **Return on investment (ROI)**

A return on investment, also known as an ROI or net present value, is determined by subtracting the beginning value of your investment in the business from the current value and then dividing the result by the beginning value. The outcome should be expressed as a percentage. ROI = (Present Value - Investment Cost / Investment Cost) x 100.

Many professionals believe that a good ROI is 10.5% or higher. ROI can also be affected by other factors such as inflation, taxes, and your time horizon. Hence, we recommend using <a href="https://www.forbes.com/advisor/investing/roi-calculator/" target="_blank">Forbes' ROI Calculator</a> to help you take into account all these issues and establish your bottom line.

- **Process efficiency**

Process efficiency is the amount of effort or input required to produce your business's product. For example, you could look at how much it costs and how long it takes to ship a product to see if there are any ways to improve the cost-to-income ratio.

- **Operational efficiency**

Operational efficiency may help you understand the health and performance of your business. It is the ratio of your business’s inputs (the costs of producing your products and services) to its outputs (the revenues generated by selling those products and services). To figure it out, add up all of your operating expenses and divide the total by your total revenue. If your costs are x and your revenues are y, then your operational efficiency is counted as x/y.

- **Labor productivity**

Labor productivity is defined as real production per labor hour, and the change in this ratio over time is used to measure labor productivity growth. The labor productivity of a company can be measured by analyzing how many employees can do or generate in an average workday. The equipment, automation, and technical tools that employees have access to have a significant impact on this type of efficiency.

- **Financial efficiency**

Financial efficiency tracks how successful a business is at converting expenses on development, sales, and marketing to revenue. It can be measured by figuring out how much of the company's income goes toward costs.

- **Adopt the OKR methodology (Objectives and Key Results)**

One way to improve business efficiency is to adopt the OKR methodology (Objectives and Key Results). It is a performance management framework designed to set and monitor broad organizational goals and results. Key results are the milestones that indicate how you know you will accomplish your objective.

## Step 2: Define what you want to have

Once you know your current situation, it is time to take action and work on finding ways to improve business efficiency. Define what you want to enhance and how. Most importantly, check whether it will be relevant for your company and your customers. Here are some pointers to consider at this step.

- **Set goals.** What picture do you want to have? What figures in metrics do you want to see? What do you want to change? Goals are an essential component of running a successful business. They may provide you with a clear focus, motivate your personnel, and set goals for your company to achieve.
- **Generate new ideas** and strategies that will help you achieve your goals. The ability to generate new thoughts is crucial because it allows you to think beyond your current viewpoint. By bringing new ideas to your business, you can easily increase its efficiency and, most importantly, improve its profitability.
- **Conduct market research. **Analyze your competitors, what other similar businesses are doing and how. Market research provides critical information about your market and your business landscape. Investing in marketing research can help you identify potential threats and opportunities. Most importantly, it facilitates strategic planning. Here’s a list of successful [E-commerce startups](https://wise-engineering.com/blog/post/10-marketplace-startups-reversing-e-commerce-trends-in-2022/) to give you some insights into what you can apply to your own business.
- **Analyze customer behavior.** The customers' behavior may be changing, and there may be new requirements. Pay attention to customer demands and adjust your goals accordingly. These valuable insights can lead to a more personalized approach to customer needs, which can increase the lifetime value of the business.
- **Consider the latest industry trends**. When it comes to the E-commerce sector, such trends as direct-to-consumer (DTC) selling, cloud computing, big data, augmented reality (AR) and virtual reality (VR), conversion rate optimization (CRO), mobile and headless commerce will dominate in 2023. Explore the [digital transformation trends for E-commerce](https://wise-engineering.com/blog/post/digital-transformation-strategy-for-e-commerce-7-trends-for-2023/) in more detail.
- **Develop a digital transformation strategy. **A digital transformation strategy is a plan of action that describes how a company should position itself strategically in the digital world. The strategy can impact your current systems, processes, workflow, and culture, which are all part of this process. This transformation affects each level of an organization and brings together data across areas to work together more effectively.

## Step 3: Optimize your business processes

The goal of optimization is to create the best possible output given a set of prioritized criteria or constraints. Optimization is especially important in business because it helps to cut costs, which can lead to increased earnings and success in a competitive environment. There are various optimization strategies that you can employ.

- **Reveal all the problems early on**

Sometimes you have to slow down in order to make sure you are solving the right problems to achieve big goals more quickly. Here’s a structured problem-solving process that may help you reveal all the problems and bottlenecks.

1. Brainstorm all the problems.
2. Determine how much benefit would result from resolving each issue.
3. Make a list of potential fixes and how much they would cost.
4. Consider the issues to identify overlaps and similarities, as well as probable shared causes.
5. Integrate and prioritize potential solutions.
6. Pick tasks to carry out, and be careful to collect some background data before you get started.
7. Focus on completing your most important work first.
8. Determine the impact of the adjustment by monitoring the predetermined KPIs for any shifts.

- **Define what to cut**

Another important way to optimize business processes is to examine your operations and decide what you can cut. Look for redundancies, outdated or excessively complicated processes, or unclear procedures. Companies frequently spend large sums of money on technology, infrastructure, and third-party apps that they use but do not see any benefit from, or simply do not use at all.

All of these are prime candidates for consolidation or elimination. But don’t cut corners. Exclude only unnecessary processes. Prioritizing efficiency over quality or safety only leads to more problems later on and additional costs solving them.

- ** Delegate**

For any organization, delegation is a critical management skill that increases productivity and opens up new lines of communication. Track how your internal tasks are distributed, and then determine which ones are taking up a lot of your time and effort. Workflow mapping can help you identify those tasks that are duplicated or challenging.

As for complex tech tasks, that require a high level of expertise, very often outsourcing brings lots of value. Instead of launching a long process of assembling the right team, you can hire the necessary specialists right away. That’s what we do at Wise Engineering and will gladly hear about your technical context and the issues you’d like to solve.

## Step 4: Automate processes

For any business that is dependent on software development, it is critical to prioritize developer experience (DX) and engineering efficiency. <a href="https://www.automationanywhere.com/company/press-room/global-research-reveals-world%E2%80%99s-%E2%80%98most-hated%E2%80%99-office-tasks" target="_blank">Automation Anywhere's research</a> shows that most software engineers spend more than half of their days doing repetitive tasks. Therefore, it is important to look for ways to eliminate unnecessarily repetitive and duplicated tasks. 

Technology as well as digital transformation services can help you automate processes and reduce the risk of manual errors. Depending on your business needs, different types of software can help you improve productivity.

**No-code and low-code**

This trend began approximately 10 years ago, and it will become even more evident that over the next 2-3 years, no-code will play a big part in digital spaces. No-code tools allow non-technical people (mostly in operations) to build prediction models on their own. Here are some of the instruments for the E-commerce sector.

- <a href="https://www.airtable.com/" target="_blank">Airtable</a>. This tool represents a mix between a spreadsheet and a database that enables you to build your custom CRM, and prospecting lists, optimize your workflow, and produce easily digestible graphics.
- <a href="https://www.clay.run/" target="_blank">Clay.run</a>. The tool enables you to identify customers using any data source, get live LinkedIn data, automate Googling, find keywords on any website, explore tech stacks, scrape job listings, and utilize GPT-3 to send customized emails.
- <a href="https://monkeylearn.com/" target="_blank">MonkeyLearn</a>. It is a machine-learning platform for text analysis. It enables users to quickly extract actionable data from raw text. You can, for example, recognize subjects or attitudes indicated in texts such as tweets, conversations, reviews, articles, and others.
- <a href="https://www.obviously.ai/" target="_blank">Obviously.ai</a>. It is a platform that allows business analysts and product teams to run predictions on historical data quickly.

These tools help speed up existing operations and tasks, so there is no need to wait for developers, which in turn lets them focus more on product development.

**Data visualization**

Another way to achieve successful digital transformations is through the use of data visualization and unified KPI tracking tools such as DataBox. Such services help you streamline the most time-consuming and repetitive tasks, while also maximizing the scope and value of services you can provide your customers.

**Tools to predict future demand for their products**
 
Tools such as Netstock, Solvoyo, or GMDH Streamline enable the planning team to incorporate real-time demand-sensing data into their inventory planning. Businesses, for example, may use real-time data from website traffic and search engine searches to better estimate future demand for their products.

**Custom software**

If there aren't any out-of-the-box solutions that fit your needs, you can build custom software. Although building custom systems can be pricier and require a different strategy and approach, they tend to save time in the long run. If done correctly, such systems allow you to meet unique requirements, build your own solution, and automate a lot of internal processes.
 
Metalpark is a great example of how building [custom software for order management](https://wise-engineering.com/case-studies/metalpark/) can help businesses improve efficiency. The company is a manufacturer of water drainage systems, and its biggest challenge was processing complex orders with different specifications. The Wise team created a custom solution that allowed the company to streamline the order management process and provided its customers with fast access to up-to-date order information.
 
The new system enabled customers to automate their order management system, and even non-technical people can now create orders. All order information was kept in one location, and personnel from various departments could access it promptly.

## Step 5: Create an enjoyable workspace

The people who work on your project are your most valuable asset. Technology is powerful, and your idea is as well, but the people behind it, as well as the atmosphere of your workplace, are those forces that bring everything to action. Here are some helpful hints on how to make your team's environment enjoyable and aligned with your values.

- **Treat job interviews with special care.** Know what type of employee you want when interviewing candidates. Sometimes it is critical to revise the current staff that you have or put sufficient effort into the interview stage to select the right people and keep them.
- **Clear and honest communication.** Ensure that each employee is satisfied. If there are any issues that frustrate your colleagues, prove that you are able to enhance the overall atmosphere. Ask employees what they like about their job. Everyone loves to vent about the negative, but encouraging them to think about and appreciate the positive aspects will help your team keep things in perspective.
- **Promote corporate values.** Having clear company values helps ensure that all your employees work towards the same goals. We believe that the company's core values should support its vision and shape its culture. Every single business decision should be aligned with these values. Here's advice from Max Drogobytskyi, CEO of Wise Engineering, on how to [build a values-driven work environment](https://wise-engineering.com/blog/post/values-driven-company-a-conversation-with-wise-engineering-ceo/).
- **Motivate your employees.** When employees are motivated, they tend to be more productive and have higher standards for their work. Figure out what makes your employees tick, and align their personal and professional goals with their roles in your company as best you can. Give your team members tasks that are challenging and meaningful. This will keep them interested and help them grow.
- **Invest in education.** Proper training is another good strategy for increasing the effectiveness of your team. Make sure there is always room for professional and personal growth. Practical training sessions led by senior employees and managers, as well as on-the-job training, will improve production efficiency.

## Key takeaways

Here at Wise, we believe there is no right or wrong movement toward improvement, you need to be ready to make mistakes but not scared to try again. We hope this article gives you insights and allows you to improve business efficiency in the long run.

Here are key takeaways from our article that will help you accomplish this goal.

- It can be challenging to maintain efficiency while neglecting effectiveness. Efficiency is like the opposite side that drives all processes aimed at achieving effectiveness.
- Efficiency ratios measure a company's ability to use its assets and manage its liabilities effectively in the current period or in the short term. A high asset turnover ratio means the company uses its assets efficiently, while a low ratio means its assets are being used inefficiently.
- Use metrics to measure your efficiency and evaluate your current situation.
- Define exactly what you want to change, delegate, cut, or automate. Implement software that may help you to prioritize developer experience (DX) and engineering efficiency.
- Business efficiency requires a certain mindset, hunger, and the knowledge that there is always more to learn. It should also be a part of your company's culture.
- Lastly, never stop optimizing. No matter how sophisticated the processes you manage to implement in your business, if you are not evolving and remain in your comfort zone, you are risking losing your current position on the market. Finding ways to improve business efficiency is something you should always be doing.

If you need assistance in driving efficiency for your business, [let's set a call](https://wise-engineering.com/contacts/) and talk about your current challenges. The Wise team will be glad to help you find the optimal ways to achieve business efficiency, both in the short and long run. 



<a href="" target="_blank"></a>



Check out a list of best business efficiency tips that will help you accelerate growth in 2023–2025. 

How to improve business efficiency with technology in 2023-2025

We've assembled a list of business efficiency tips that will help you accelerate growth in 2023–2025.

How to improve business efficiency with technology 

Wise blog graphic_Top-10 E-Commerce Trends.svg

E-commerce

The E-commerce industry is rapidly evolving, with new stores and business ideas popping up every day. Global E-commerce revenues hit <a href="https://www.statista.com/statistics/534123/e-commerce-share-of-retail-sales-worldwide/#statisticContainer" target="_blank">$4.9 trillion</a> in 2021. This number is expected to increase by 50% over the next four years, reaching around $7.4 trillion by 2025. More than ever, owners are creating and improving their E-commerce platforms, and the competition is heating up.

Based on the recent market research and our experience, we have compiled a list of E-commerce trends that are more likely to define the future of custom development in the industry. Knowing such forecasts can help you focus on what's relevant and offer your customers the *ahead-of-the-curve* experience in 2023 and beyond.

## E-commerce development trends overview

There are several tendencies in E-commerce development to keep an eye on in the coming year. Here’s a brief overview of E-commerce trends you need to know in 2023. A more detailed description of each of them will follow.

![E-commerce trends for 2023](https://wise-site.fra1.digitaloceanspaces.com/e_commerce_trends_2023_607a7b463a.svg)

## #1 Mobile commerce

Allowing clients to shop via mobile devices is no longer an exception but a new norm. According to statistics, mobile devices account for <a href="" target="_blank">61% of retail traffic</a>, with <a href="" target="_blank">70 million online users</a> shopping via mobile devices. This figure will definitely increase, so we are convinced that mobile commerce will be one of the primary E-commerce development trends shaping the future.

The reason is simple and clear: mobile shopping is convenient. It enables customers to make purchases from any location, which is essential in today's world. Customers can simply research, compare products, and make payments on the go.

Here are the main aspects to consider in mobile E-commerce development.

- **Visual appearance and UX/UI elements.** When people are browsing or looking for inspiration on their phones, they will often want to view the product in more detail or grab a screenshot of an item that catches their eye. By giving your mobile app a great look and high-quality images of your products, you can take it to the next level and win the appreciation of your customers.
- **Search functionality.** Optimize your customers’ search experience for mobile. Showing their recent searches is a good practice. For example, when a user searches for a product, they see previous searches for comparison or as a reminder. 
- **Checkout process.** Provide a seamless checkout option for mobile shoppers with services like one-click checkout. Make it simple to enter and exit the cart. Obviously, your cart should be highlighted in the main screen. Include a mini cart for mobile devices that shows the contents of the shopping cart as an overlay when users click on the shopping cart icon instead of taking them to an entirely new screen.
- **Push notifications.** Leverage features like in-app push notifications to alert customers of special offers and other reminders. Push alerts are rarely helpful on their own. Combine them with a full understanding of the customer journey, smart personalization, and clever in-app messaging to make a winning strategy for engaging, converting, and keeping mobile customers. 

To learn more about mobile commerce and get inspired by the great examples of how companies implemented it, read our previous article featuring [10 best use cases of mobile commerce apps](https://wise-engineering.com/blog/post/top-10-mobile-commerce-apps-best-cases/).

## #2 Marketplaces boom

Marketplaces provide a simple paradigm for various suppliers to collaborate on a single system to handle everything, making it easier to reach out to specific groups of people and address specific problems. This model will become more popular in the next few years. According to Forbes, marketplace sales will exceed <a href="https://www.forbes.com/sites/forbesbusinesscouncil/2021/02/22/the-prevalence-of-the-online-marketplace-model-and-its-impact-on-e-commerce/?sh=1208e3bd78fa" target="_blank">$3.5 trillion</a> by 2024.

How can marketplaces change E-commerce, and what approaches will be noticeable? Here are several of the key predictions.

- **Brand and niche marketplaces.** Small and medium-sized businesses may shift from competing in established ecosystems such as eBay or Amazon towards using niche marketplaces. Personalization and customization will be the main focus for many. In turn, niche marketplaces can help satisfy the needs of experienced buyers who are looking for specific products. It's all because they may offer a more complete set of specialized products and hard-to-find items.
- **Omnichannel strategy. **Thanks to technological advancements, consumers can now shop across channels with little to no difference in buyer experience. As a result, marketplaces must work hard to establish a presence in all possible channels. An omnichannel strategy has benefits like a better customer experience, more sales and traffic, more loyal customers, and a better way to collect data.
- **Cross-border trade.** The massive shift in consumer behavior triggered by the pandemic enabled E-commerce to travel cross-border with almost no geographical constraints. However, to remain relevant and successful, cross-border E-commerce must address a range of challenges, including cross-border banking, taxation, pricing variation across countries, and security concerns.

All-in-all, recent changes in the global E-commerce industry have opened up new chances for growth. Learn about [10 marketplace startup ideas](https://wise-engineering.com/blog/post/10-marketplace-startups-reversing-e-commerce-trends-in-2022/) that managed to adapt to new challenges and will help you look at this model from a new perspective.

## #3 On-site search personalization

Without a shadow of a doubt, personalization will play a pivotal role in [custom E-commerce development](https://wise-engineering.com/expertise/e-commerce/) shortly. According to statistics, more than <a href="https://sendgrid.com/blog/the-state-of-personalization-2021/" target="_blank">60% of consumers</a> are more likely to become returning buyers if a company provides a personalized shopping experience. Accordingly, we can expect an even more significant shift towards personalization, especially connected with searching experiences. 

On-site search personalization refers to tailoring search results for each particular customer according to their past behavior on your site, profile data, and many other aspects. Using search engines such as Elasticsearch or Algolia, for example, you can make suggestions on what search results your customers expect to see while they are typing their search queries. 

<a href="https://www.searchenginewatch.com/2016/05/03/how-to-use-site-search-to-improve-conversion/" target="_blank">43% of customers</a> use the site's search while making a purchase, so investing in search personalization can be a crucial source for making information accessible all around your site and retaining more customers. To discover more about on-site search personalization, check out our earlier article on what [on-site search personalization](https://wise-engineering.com/blog/post/site-search-personalization-how-to-configure-use-cases/) is and how to set it up.

## #4 Artificial intelligence (AI)

Most of the cutting-edge technologies, such as smart chatbots, personalized product recommendation engines, and voice searches use artificial intelligence (AI), and in the coming years, they will become essential for the E-commerce sector. With <a href="https://www.statista.com/statistics/1175063/ai-help-business-ecommerce-companies-worldwide/" target="_blank">70% of online business owners</a> believing that AI for E-commerce will help them personalize their online shops, there's no doubt that this technology will continue to grow.

Voice-activated payments, virtual conversations, and voice searches are the most common NLP use in E-commerce. Besides, computer vision provides for face detection and identification. During an engagement, chatbots employ deep learning algorithms and NLP to grasp the second party's speech and human words. Besides, expert systems may make decisions and mimic human behavior with the assistance of AI as a key component of fraud prevention and security enhancement in E-commerce.

Here are several possible ways to use Artificial Intelligence in E-commerce in the coming years.

- **Smart recommendation engine** for online shops that works based on user behavior can offer users the products they are looking for. For example, virtual dressing rooms are a type of software that helps consumers digitally try on clothing. 
- **Supply chain planning.** AI algorithms are capable of collecting and analyzing massive amounts of data, assisting E-commerce organizations in detecting logistical issues. According to IBM research, <a href="https://www.ibm.com/downloads/cas/DGP9YPZV" target="_blank">40% of organizations</a> who participated in the study solved supply chain difficulties with AI.
- **Shopper mood tracking.** AI-powered E-commerce technology can track and recognize specific customer moods and patterns, assisting online retailers in maintaining more accurate product selection. <a href="https://www.theverygroup.com/" target="_blank">The Very Group</a>, for example, effectively used AI mood-tracking technology in its machine-learning chatbot. It identifies the tone of consumers' communications and adapts responses accordingly.
- **Production process control.** By combining artificial intelligence and production process management, cost overheads and downtime can be reduced. According to Capgemini's market analysis, <a href="https://www.capgemini.com/wp-content/uploads/2019/12/AI-in-manufacturing-operations.pdf" target="_blank">51% of European manufacturers</a> utilize AI solutions.

As you can see, E-commerce may benefit from AI by using the accumulated company and consumer data for more informed decision-making and accurate predictions for the future.

## #5 Augmented Reality (AR)

Augmented reality (AR) is a real game-changer in E-commerce. Statista estimates that the augmented reality industry is worth <a href="https://www.statista.com/statistics/591181/global-augmented-virtual-reality-market-size/" target="_blank">$30.7 billion</a>, with over 400,000 AR glasses sold by 2021.

This technology uses 3D mapping to allow customers to try on things or preview experiences before purchasing. What challenges does AR commerce solve? It allows you to deliver a more intuitive and engaging visual shopping experience that lets customers interact with products in an immersive way. As a result, AR technology improves customers' ability to visualize products before buying them and make more successful purchases.

That’s why we are expecting a lot more businesses to utilize AR for their products and services, especially in specific industries, such as fashion and home decor, because the customer can get a better feel for the item without seeing them in person.

## #6 More ways to pay

<a href="https://www.statista.com/statistics/477804/online-shopping-cart-abandonment-rate-worldwide/" target="_blank">69.8% of shoppers </a> drop off somewhere between filling their cart and making the payment. Let’s face it, typing in a credit card number is not the most user-friendly experience. That’s why offering more payment methods for customers can be in more demand soon. 

If customers can't pay as they want on an E-commerce website, chances are high that they will cancel a possible sale. Offering a range of payment options is an excellent approach to boosting conversion rates. Furthermore, if clients can save their payment information on your website (and this process is secured), they will be able to check out faster the next time they make a purchase.

Consumers are quickly adopting new payment methods, with <a href="https://investor.mastercard.com/investor-news/investor-news-details/2021/Mastercard-New-Payments-Index-Consumer-Appetite-for-Digital-Payments-Takes-Off/default.aspx" target="_blank">93%</a> saying they would consider emerging payment methods such as biometrics, digital currencies, and QR codes. Among the most commonly used payment methods are PayPal, Amazon Pay, and Apple Pay.

Another growing payment method is cryptocurrency. While this is still a very new trend, it’s hard to predict what will happen next. However, several big players, including Microsoft, Starbucks, PayPal, and Tesla are already accepting <a href="https://www.euronews.com/next/2021/12/04/paying-with-cryptocurrencies-these-are-the-major-companies-that-accept-cryptos-as-payment" target="_blank">cryptocurrency as a payment method</a>. Besides, <a href="https://investor.mastercard.com/investor-news/investor-news-details/2021/Mastercard-New-Payments-Index-Consumer-Appetite-for-Digital-Payments-Takes-Off/default.aspx" target="_blank">40% of consumers</a> would like to use cryptocurrency in the next year. 

## #7 Sustainability & recommerce

<a href="https://www.gfk.com/blog/how-fmcg-brands-can-capitalize-on-soaring-eco-consumer-spending-power" target="_blank">52% of consumers</a> worldwide admitted that the pandemic has made them value sustainability issues more. Moreover, a survey found that nearly <a href="https://www.cleanlink.com/news/article/Survey-Do-Consumers-Value-Sustainability-Based-Products--28560" target="_blank">80% of customers</a> consider the sustainability of the product, retailer, or brand when making purchases.
 
**What exactly is recommerce?** Recommerce (resale or reverse commerce) is the purchase and selling of previously owned, new or used things. Buyers are increasingly seeking items and companies that correspond with their environmentally conscious attitudes. Brands are already reacting to this. <a href="https://edition.cnn.com/2019/07/19/business/zara-sustainable-fashion-trnd/index.html" target="_blank">Zara</a>, for example, wants all of its brands to utilize entirely organic, sustainable, or recycled materials in its clothes by 2025. Smaller D2C brands are also trending in the same direction. Retailers are making a significant contribution by concentrating on sustainability. At the same time, this allows them to build long-term connections with their consumers while also reaching out to new audiences.

## #8 Omnichannel customer experience

Many companies plan to prioritize omnichannel in the coming years. Indeed, with rising customer acquisition costs (CAC), this can be extremely advantageous. According to a recent study, <a href="https://www.shopify.com/retail/omnichannel-trends" target="_blank">32% of brands</a> want to extend their in-person interactions in 2022, such as by opening pop-up shops or putting items in retail locations.

Customers expect to be able to easily transition between platforms and devices when making a purchase. A recent study shows that <a href="https://segment.com/blog/Twilio-Segment-biggest-innovations-in-2021/" target="_blank">69% of shoppers</a> said they expect a consistent experience across all channels. A tailored shopping experience does not rely solely on one mode of communication. To successfully personalize, merchants must focus on offering a consistent experience across many platforms.

We're also witnessing a significant increase in *showrooming* and *webrooming*. Showrooming takes place when a person visits a physical store to inspect things before purchasing online. Webrooming is the inverse, with customers browsing things online before purchasing in-store. <a href="https://www.shopify.com/research/future-of-commerce/future-of-retail" target="_blank">54% of consumers</a> participate in showrooming and 59% utilize webrooming, therefore companies interested in experimenting with these should focus on creating a consistent experience across channels.

## #9 Social commerce

Buying and selling things or subscribing to services directly through social media is known as social commerce. Unlike in the past, when social media was exclusively used for marketing, several of these platforms now have built-in technology that allows individuals to purchase things directly through their applications — for example, Facebook and Instagram Shops.

In addition to allowing social media to become a direct sales channel, social commerce entails the advertising of items on social media increasing interaction. Furthermore, consumers may now get information, advice, or comments on things right where they buy them.

The social commerce industry is expected to grow steadily <a href="https://www.globenewswire.com/en/news-release/2022/05/12/2441684/28124/en/United-States-Social-Commerce-Market-Report-2022-Market-is-Expected-to-Grow-by-27-to-Reach-188-744-6-Million-in-2022-Forecast-to-2028.html" target="_blank">by 22.8%</a> during 2022-2028. According to a recent Accenture estimate, social commerce will expand three times faster than traditional E-commerce solutions, more than surpassing from <a href="https://www.insiderintelligence.com/insights/social-commerce-brand-trends-marketing-strategies/" target="_blank">$492 billion</a> in 2021 to $1.2 trillion in 2025.

Currently, Pinterest, Instagram, and Facebook all have their own tools for buying and selling things, and TikTok has unveiled TikTok Shopping. With these rapid upgrades, more firms will use social commerce to influence customers' purchase decisions, giving them increased visibility and bigger conversions.

## #10 Live shopping
Many people were forced to find new methods to make a livelihood as a result of the pandemic. Successful business owners have recognized the advantages of using live video to sell items and engage with consumers.

According to McKinsey, live commerce sales might account for <a href="https://www.mckinsey.com/business-functions/mckinsey-digital/our-insights/its-showtime-how-live-commerce-is-transforming-the-shopping-experience" target="_blank">up to 20%</a> of total E-commerce by 2026. While live streaming was once only a fun feature for social network users, it is now becoming one of the vital E-commerce solutions. We anticipate that live selling will become a prominent trend in the next decade for small firms that are still looking for leads and developing their consumer base.

## Wrapping up

Technology and people are always advancing, and because E-commerce connects them all, we must always look ahead. As you can see, the landscape is getting more competitive. Customers are currently in charge, and E-commerce companies are adapting to meet their needs. 

Adaptability to shifting market conditions is essential today. However, not every trend is worth jumping on. Some tendencies can be helpful, while others may be irrelevant to your audience. Prior to making any decisions, it is important to evaluate project specifics, analyze user feedback, and focus on goals ahead. 

If on your way to an [advanced E-commerce ecosystem](https://wise-engineering.com/expertise/e-commerce/), you are looking for a tech partners who can consult you on what is best for your project, do not hesitate to talk to the Wise team. [Contact us](https://wise-engineering.com/contacts/) to discuss your tech strategy for 2023 and beyond.




Check out 10 fresh E-commerce development trends and build your business strategy for 2023 staying up-to-date with new tendencies in the industry.

Top-10 E-commerce trends for 2023 and beyond

10marketplaces_preview.svg

It is hard to find another E-commerce format growing today more rapidly than marketplaces. At Wise, we have been launching and scaling marketplace platforms for more than 15 years, but today more than ever, we observe the real boom of cool marketplace startups that help look at E-commerce business from a quite new perspective.
 
In this post, we will look closely at a collection of great startups and see how they approach the marketplace model to implement their business ideas. The way these companies put forward their value proposition, the customer problems they address, and the industries they select to build their businesses are really inspiring. All these factors help them set the tone for E-commerce trends in 2022 and will, for sure, give you some insights to apply for your own marketplace startup.
 
## Major shifts in custom marketplace development
 
Dealing with [custom E-commerce development](https://wise-engineering.com/expertise/e-commerce/), we see common patterns in recent years that define directions the whole industry is aiming towards. Sad to acknowledge, but the truth is – no one needs another marketplace selling* everything for everyone*. Marketplace as a business model offers an exclusive opportunity to connect with specific audiences and address specific problems, and now’s the time to use these hidden powers to their fullest potential. Here’s how marketplace development has been changing recently.
 
![5 shifts in custom marketplace development](https://wise-site.fra1.digitaloceanspaces.com/10marketplaces_trends_4b59e2fd0e.svg)
 
Learn more about [online marketplace development trends in 2022](https://wise-engineering.com/blog/post/5-shifts-defining-marketplace-development-in-2022/) from our previous post, where we analyzed all of the five tendencies above in detail.
 
**Now let’s look closely at the rising branded marketplaces and the trends they are initiating in E-commerce today.**
 
## Fresh start for Livestream shopping
 
We all saw those commercials on television when a vacuum cleaner was miraculously cleaning the sofa, and you could buy it with a special discount while the commercial was running. This was a predecessor of the tendency we observe today – Livestream shopping, or live shopping. It has got its popularity with the development of social media, and brands around the world have started to use it as a new sales channel to promote and sell products.
 
The founders of <a href="https://www.buywith.com/" target="_blank">*buywith*</a>, an online shopping Livestream platform, saw this growing opportunity and used the marketplace model to connect brands, retailers, influencers, and experts. The platform allows hosting live shopping events and automates the sales process. Seeing products live and in action drives sales, plus the credibility of the person performing the Lifestream increases conversion immensely.
 
## Space-as-a-service model
 
A marketplace is a truly unique E-commerce form that allows businesses to think outside the box. A great example of such business thinking is the <a href="https://shearshare.com/" target="_blank">*ShearShare*</a> app. With the mission of becoming the greatest engine of jobs and wealth creation for the barber and beauty industry, *ShearShare's* Co-Founders decided to redefine the way salons and barbershops run their businesses and assisted them with the most valuable asset – the space.
 
The *ShearShare* marketplace allows small businesses to offer the space they do not need at their salons to local professionals and receive one more income channel. Via the new space-as-a-service model and the efficient process automation, the startup ensures that collaboration is flexible and productive for all sides involved.
 
##  Challenging the status quo
 
Challenging the way things are organized is one of the most important traits innovative startuppers should possess and, as the companies below illustrate, a marketplace as a business model allows you to do it across industries and domains.
 
### Reshaping established industries
 
The heavy equipment industry is a big and serious sphere with a set of strict rules and regulations. Yet, there is a startup that pushes the status quo of how heavy equipment is obtained by various companies. <a href="https://www.boomandbucket.com/" target="_blank">*Boom & Bucket*</a>
is a heavy equipment marketplace with a team of industry veterans that know all the specifics of this business and want to change the way used equipment is being reused and resold.
 
On the *Boom & Bucket* marketplace, customers can browse across multiple categories looking for bulldozers, excavators, wheel loaders, and many more machinery. Because of the accurate inspections, the quality of the used equipment is well-monitored, and access to financing warranties and transportation is provided. *Get in a car* is one of the team’s shared values that help them approach customer service with ownership and exceptional attitude.
 
###  Changing common approaches
 
Is there an activity that you can not get a coach and consulting buddy for? No there is not, claims the <a href="https://www.joinleland.com/" target="_blank">*Leland*</a> team that created a marketplace for ambitious people and helps their customers access the coaching and classes to reach career and educational goals. All you need to do to get a coach is to define the skills you need, your budget, and previous experience, and they will recommend the best matching mentors for you.
 
If most similar EdTech marketplaces offer the ability to find a tutor for specific subjects, *Leland* allows you to choose from multiple skills, tests, and domains. The platform connects coaches and students around the globe and builds a really cool community of people helping each other grow.
 
### Introducing new customer behaviors
 
Building a selling new and used shipping containers? However unusual it may sound, you can. <a href="https://boxhub.com/" target="_blank">*Boxhub*</a> is a successful marketplace that allows people to buy and sell containers in their neighborhoods. Containers can be used when moving houses or when simply extra storage space is needed. It can also be turned into a tiny temporary home, farm, office, or storefront.
 
Because the startup introduces a new pattern to using different types of containers for households, right on their homepage, the team explains in detail what shipping containers are, what types of containers exist, and how they can be used. Making an order is simple and intuitive. You need to enter your zip code, and the system will show you the available containers in your location.
 
##  Technology matching sellers and buyers
 
Connecting the right audiences with the right merchants is the ultimate goal of any marketplace. No matter what industry it operates in. To ensure this connection was fast and efficient, some platforms develop unique technologies that become a part of their value proposition later.
 
To illustrate such a case, let’s look closely at <a href="https://repowr.com/" target="_blank">*REPOWR*</a>, a marketplace that enables logistics companies to efficiently source equipment capacity. The team applies Digital Equipment Matching technology that allows transportation companies to have instant on-demand access to available equipment nearby. Your assets are valuable, says the *REPOWR* team, and offers transportation companies a great way to collaborate and use assets effectively.
 
## Presenting innovative product types
 
Also, a way to innovate the marketplace model is to start using it as a selling platform for a variety of digital and unusual types of products and services. No one thought that this is possible, but the companies below saw the problems in their niches and today run successful marketplace businesses.
 
### Selling IP licensing
 
<a href="https://www.layerlicensing.com/" target="_blank">*Layer*</a> is a marketplace platform for IP licensing in the gaming industry. The team's vision is to allow all the global games to collaborate with the best creators: from brands and characters to stories and celebrities. The platform helps to match IP profiles with game profiles based on multiple criteria, including commercial, audience, and objective. *Layer* also simplifies communication between the counterparts on creating proposals and streamlines the overall licensing process.
 
The *Layer’s* Co-Founders say that games were their passion from childhood and they want this industry to function properly, more smoothly, and bring joy to people around the world. Another great example, of how to make a successful business you need to find an activity that you love.
 
### Marketplace of discounts
 
Can you imagine an online platform where you can shop for discounts? No? Then have a look at <a href="https://theconvoy.com/" target="_blank">*the Convoy*</a>. With the mission to help small businesses optimize their spending on various online services, *the Convoy* allows you to select the services your team uses and cut the subscription bills.
 
As for their monetization model, the deal is quite simple: if *the Convoy* team negotiates for discounts for you, they might get a small percentage for themselves. For example, from a 22% overall discount, they will keep something like 2%.
 
## Making an impact
 
Kantar’s recent study says that <a href="https://adage.com/article/agency-news/kantar-study-shows-consumers-expect-brands-be-helpful-during-coronavirus-pandemic/2246361" target="_blank">77% of customers</a> expect companies to be helpful during the covid outbreak, and this tendency is there to stay. While multi-vendor marketplace development is moving towards branded marketplaces, impactful businesses are those that come to the forefront and can build strong brand communication. Supportive consumption is on the rise, which means impactful businesses will continue to receive encouragement from their audiences.
 
### Clean energy at the fingertips
 
How do you like the idea that you could organize all the aspects for your company to use renewable energy in a few steps through an intuitive interface? And what if we tell you that this mind-blowing idea is already implemented? <a href="https://www.renewafi.com/" target="_blank">*RenevaFi*</a> is an online marketplace that allows companies and utilities to buy renewable energy directly from clean power plants.
 
On the website, you can buy renewable energy on a screen in simple four steps: specify energy needs, run a competitive auction based on *RenevaFi’s* patent-pending technology, compare proposals, and download a custom contract as a start to a new eco-friendly energy resource. The company’s mission is to make renewable energy contracting faster, more affordable, and less risky, and it deserves a lot of appreciation.
 
### Starting new cultural movement
 
There is room for improvement in any industry and occupation, even if it comes from centuries ago. A good idea and a brave mission can bring it back to life. As an example, let’s look closely at <a href="https://thecobblers.com/" target="_blank">*the Cobblers*</a> marketplace. The company provides expert repair for premium sneakers and high-quality leather goods, including women’s and men’s shoes, handbags, and leather garments.
 
*The Cobblers* team claims they are setting up a new, more thoughtful, cyclical *up-cycling* approach to expensive shoe wear and leather goods usage. Conscious consumption is very popular today, and the company is rapidly growing its popularity in the USA. To make their point more clear, *the Cobblers* say that with each of the unique items they repair, they also make the memories connected to them live longer.
 
## Tell your story
 
This was a recap of great companies that looked at the marketplace business model from a fresh angle and saw a great opportunity to connect people, change operations within industries, and sell unusual product types and services.
 
**What unites all these ten companies?** Though they operate across industries and engage with different audiences, the unique story behind each marketplace is what all of them have in common. There is a mission behind each marketplace app, and all of them communicate it clearly to explain why they launched their businesses in the first place.
 
Learn more about how to launch a [marketplace MVP](https://wise-engineering.com/blog/post/mvp-development-for-a-marketplace-platform/), [contact us](https://wise-engineering.com/contacts/) to start discussing the engineering realization of your big idea, and let the world know it!


Let’s look closely at a collection of great startups and see how they approach the marketplace model to implement their business ideas >>

10 marketplace startups reversing E-commerce trends in 2022

Let’s look closely at a collection of great startups and see how they approach the marketplace model to implement their business ideas.

dedicated_team_preview.svg

A dedicated software development team is a jack-of-all-trades model in terms of outsourcing. It is like hiring your own IT department of like-minded specialists who are ready to kick off your project, share the same values, and are passionate about your product. However, the key is not the model but the right people behind it.
 
When it comes to hiring such teams, we witness a variety of choices caused by the growth of the outsourcing industry, the value of which is expected to reach <a href="https://moderngentlemen.net/outsourcing-statistics/" target="_blank">$405.6 billion by 2027</a>. Over the years, more and more vendors have entered the market offering software development services under various collaboration models. How to recognize and hire a dedicated team that is suitable for you?
 
In this article, we'll look at the latest trends in the outsourcing market to provide you with a full picture of what is relevant today. Besides, you'll get a list of characteristics that define an expert dedicated tech team. Finally, we'll share some advice for hiring, so you can select the right experts to contribute to your project.
 
## Trends & overview of the IT outsourcing industry
 
It is good practice to do some research before selecting a partner. The technologies, as well as software outsourcing companies, are changing rapidly. The things seen as progressive in the previous year may already be outdated. So what’s the picture of today’s outsourcing software development services? Let’s see more closely.
 
- Market growth & tendency to reduce costs
 
The outsourcing market is gaining momentum. According to Statista, <a href="https://www.statista.com/statistics/1091189/outsourcing-penetration-rate-north-america-country/" target="_blank">66% of US companies</a> outsource at least some of their operations. The reason for this is obvious: outsourcing helps to accelerate the development of a project and increases the return on investment. It reduces costs <a href="https://moderngentlemen.net/outsourcing-statistics/" target="_blank">by 15%</a> on average and <a href="https://whattobecome.com/blog/outsourcing-statistics/" target="_blank">up to 60%</a> in some cases.
 
- Tech trends
 
According to Deloitte, <a href="https://www2.deloitte.com/global/en/pages/operations/articles/gx-global-outsourcing-survey.html" target="_blank">68% of companies</a> use cloud services as one of the primary enablers in their outsourcing journey, such as SaaS (Software as a Service), PaaS (Platform as a Service), and IaaS (Infrastructure as a Service). **RPA (Robotic Process Automation)** is ranked second among the major outsourcing enablers, with 64% of organizations using it. 55% stated they use a single instance of **ERP (Enterprise Resource Planning)**.
 
- New communication models
 
Today, we all have to work in increasingly dynamic working environments. All this is because of quick changes in the market and the fact that the majority of development outsourcing companies switched to remote work because of the COVID-19 pandemic. This requires the use of communication tools like Slack and Google Meet, Zoom, and more sophisticated approaches for <a href="https://wise-engineering.com/blog/post/how-to-manage-remote-team-in-increasingly-dynamic-environments/" target="_blank">managing remote teams</a>.
 
Another important tendency is a significant shift in communication between product owners and the team itself. Previously, project managers served as a bridge between the two sides. But today, we have a <a href="https://wise-engineering.com/blog/post/new-communication-model-in-software-development-outsourcing/" target="_blank">new communication model in outsourcing</a>, under which clients are more willing to attend meetings and interact with the developers. Actually, it works pretty well because it provides faster feedback and sets the development on the right track.
 
## Dedicated team: definition, benefits, and when to hire
 
Now, let’s see in more detail what a dedicated software development team actually is and how it differs from other collaboration models? Generally, there are three main outsourcing models that describe the relationships between the business and the IT service vendor.

![Collaboration models in outsourcing](https://wise-site.fra1.digitaloceanspaces.com/dedicated_team_models_6d28ada73d.svg)
 
A dedicated development team is a goldmine when you want to scale your team with top talented people. No matter if you need to extend your existing team (use it as team augmentation) or build your product from scratch with an entirely new team, this model will help you reach the desired goals.
 
**What is the structure of a dedicated team?**
 
The structure is totally customizable per your needs. In most cases, it includes front-end, back-end, full-stack developers, DevOps engineers, project managers, UI/UX designers, and any other additional experts like data scientists, solution architects, marketing consultants, or business analysts.
 
**The benefits of a dedicated software development team**
 
Let’s take a closer look at the possible advantages when a dedicated development team model works successfully.
 
1. Established work processes
 
You obtain self-organized teams that may already have previous experience with different projects. You don't have to spend time building a team. It will consist of people who are used to working together and will be operating at their full potential from day one.
 
2. Hassle-free recruitment and talent management
 
You are not required to find, attract, recruit, and onboard new staff. All you have to do is review candidate profiles and select those that have the necessary skills and are a good fit for your company culture. The vendor covers all costs, including paid time off, private healthcare, hardware, and other perks.
 
3. Cost-effectiveness 
 
Hiring a dedicated development team cuts your business running costs. Among other things, you can save money on equipment, and other administrative costs. In addition, you won't have to pay for any recruitment or hiring expenses, training, or taxes.
 
4. Your project is the main focus
 
You can be sure your project is always the priority. Dedicated software developers keep the project on track without any interruptions. They are completely focused on your assignments and do not switch to anything else. Furthermore, as time passes, their expertise in your product becomes deeper and more sophisticated, increasing the likelihood of gaining better results throughout development.
 
5. Ability to focus on your core activities
 
Once you delegate the scope of your work to a dedicated team, you can focus on more strategic things. You simply know that the work is in responsible hands. As a result, you have more time to work on other aspects of your company's operations.

![Benefits of hiring dedicated development team](https://wise-site.fra1.digitaloceanspaces.com/dedicated_team_benefits_5cafb91c2c.svg)
 
## What does a decent dedicated team look like?
 
The best way to hire the right people is to have a clear vision of what a strong team looks like. How to evaluate the effectiveness of such a team, and what is relevant today? Here are some important aspects to consider.
 
- Flexible

The specifics of such a model provide quick adaptability to new projects. That’s why a great team should be able to select **the right approach** for your project and be able to pivot when business requirements change.
 
- Involved

A great team has a specific attitude towards the work they do, and when they onboard a project, take **full ownership** of it. With some level of autonomy and good communication set up, an effective team will initiate changes both to your product and engineering processes.

- Open to challenges 

Motivational and ready-for-challenge people are another important aspect. People may have the skills, but if they aren't motivated enough, their contributions to the project won't have the results. The team should be ready to go through the path of developing the workload to the end, no matter how thorny it may be and no matter what challenges it has ahead.

- With solid expertise 

This is obvious, but nevertheless, this list could not exist without this point. Technical expertise can have a wide range of domains, such as [custom E-commerce development](https://wise-engineering.com/expertise/e-commerce/), [custom web development](https://wise-engineering.com/expertise/), and [mobile development](https://wise-engineering.com/expertise/mobile-development/). Be narrowly focused on what exactly you want to develop and what technologies you need to utilize. For example, if you want to build a web platform, you need to look for a dedicated web development team. In this case, your chances of selecting the right team will be much higher.

- Building partnership

Every organization has its own practices and vision of how they develop business relationships with its outsourcing teams. We believe effective collaboration is similar to friendship. It is important to feel that you are on the same page and share things that are important to each of you.

- Agile and easy to follow

Always look at the project management methods used by the dedicated team. Scrum or Kanban-based agile methodologies are currently the most popular (almost 90% of software development projects work in Scrum).

The most significant benefit of agile adoption is the project success rate. Statistics show that <a href="https://www.zippia.com/advice/agile-statistics/" target="_blank">91% of agile-led projects</a> succeed in achieving their objectives. With Scrum or Kanban, a team delivers a product iteratively and provides regular updates such as prototypes or live demo versions depending on the phase of the project. Weekly or bi-weekly reports and burn-down charts help track the progress and obtain a clear understanding of what is happening in the development.

- Taking risks into account

The development of any product is not a straight line from point A to point B; it is a winding road with many challenges and risks. A dedicated team should react quickly and eliminate the risk before it becomes a problem. 

Brainstorming regularly with your team helps you identify where the risk factors lie. As for the WE team, we typically identify risks early in the development cycle, and often the main factors are discovered during the product development kick-offs. If a risk is discovered, we set up a meeting with all the stakeholders and people involved and develop a plan to prevent the identified issue.

- Providing honest feedback

The greatest product development teams communicate ideas and comments openly. Your project will only succeed if developers are not afraid to offer constructive judgment. As a result, there should be no hidden issues. In many cultures, it's considered rude to question the decisions of top management, but real experts are often free to provide constructive feedback and suggest improvements.

- Investing in knowledge

It is a good sign if a dedicated team spends a considerable amount of time learning and broadening their expertise. It is always beneficial if a tech team has space for growth in skills, shares knowledge continuously, and experiments with the most innovative technologies.

## Best practices to hire a dedicated software development team

Once you know how a dedicated team model works and what a great partnership looks like, you can start hiring. Based on our experience in building dedicated teams and collaborating with multiple customers, we identified useful practices that can improve the hiring process. This advice will increase your chances of making a deal with a reliable and competent partner.

### 1. Communicate and set clear expectations

Communication is the fuel of any collaboration. It is important to set interactions on the right track and make sure that both sides are ready to care and listen. The golden rule for further effective collaboration is a mutually equal exchange of resources. Ensure a dedicated team can handle all of your expectations, and you, in turn, as a customer, can cover all the expectations of the team as well.

For example, the Wise Engineering team approaches all forms of communication very attentively, with special attention to minor details. This attitude allows us to be on the same page with the customer. As a result, it allows us to quickly take full control over a project and align with all the requirements and overall product vision.

### 2. Define key goals and requirements
Ensure that all of your goals and requirements are clearly defined so that a vendor can understand them. Make a list of questions ahead, and avoid broad or cliché questions, such as *What technology is best for my application?* Better prepare the answers for the following narrowly focused questions: 

- *What is the core product functionality?*
- *Who are the users? Where are they located?*
- *What type of data should be processed? What is their structure?*
- *Are there marketing campaigns planned? When do we expect user base growth?*
- *How soon will we need to expand the engineering team?*
- *What are the time restrictions? Are there due dates set?*

Read our recent article on <a href="https://wise-engineering.com/blog/post/tech-choices-in-startup-mvp-development/" target="_blank">MVP tech stack</a> to discover more information on what questions to ask a vendor, how to approach the first step of communication, and building the first MVP. The ideal scenario is to clarify all the functional and non-functional requirements for your project. The vendor obtains a clear picture of what is needed to be done and then presents more precise proposals. 

### 3. Request proposals from several vendors

To receive detailed information from a vendor about your collaboration, you can write so-called RFx documents:

- **Request for Information.** In this document, you can describe the general problem that needs to be solved and ask a vendor for a detailed answer about which technologies are best to use to put your idea into action.
- **Request for Proposal. **In an RFP, you describe your project in greater detail (perfectly with functional, non-functional, and business requirements). In response, the vendor gives you a detailed implementation plan that shows how you can meet each requirement.
- **Request for Quote. **If you want to evaluate what budget you need to allocate to the entire project, you can send an RFQ, and the vendor will reply with a document with full pricing.

These documents announce a project, describe it, and solicit bids and ideas from vendors. It's a good idea to outline all of your needs in writing before signing a contract with a vendor. Besides, you can receive several proposals from different vendors, compare them and evaluate who could be more beneficial for you.

### 4. Use security measures

As far as you will communicate a lot about processes, one of the most significant concerns is security. This is primarily a source of worry because you’re trusting newly found entities with sensitive information. Pay attention to signing the Non-Disclosure Agreement (NDA) right from the start. 
Check if the dedicated team provides you with an opportunity to sign an NDA and what additional data privacy and security measures it provides. You can sign a unilateral (one-way or one-sided NDA and use it when only you are sharing materials) or a bilateral NDA (two-way type, when both of you provide access to confidential information).

### 5. Define the scope of work to be done
It is good practice to describe all the work that will be performed. To do this, another portion of routine yet useful paperwork can serve you well. For example, as a customer, you can write a Software Development Statement of Work (SoW) or ask a vendor to output a Software Requirements Specification (SRS).

**Software Development Statement of Work (SoW)** covers all the details and expectations of collaboration. The aim is to make the agreement valid and legally protected. A correctly written SoW can serve as a reliable blueprint and confirmation that you and your vendor share the same vision. The document contains:
- An overview of a project.
- The scope of work to be done by a vendor (technical details, documentation).
- Conditions of collaboration, Key Performance Indicators (KPIs), deadlines, payment, and other acceptance criteria.

SoW is like a key for security and guarantees that the product will be realized precisely as you wanted it to be. Thus, there are more chances that collaboration will end up successfully.

**Software Requirements Specification (SRS)** is a roadmap to the entire project and the cornerstone of proper software development. Usually, SRS is written by a tech lead from the vendor’s side, and developers from the dedicated team use it as a reference or a clear plan of all the tasks they need to perform.

### 6. Follow the right steps
Once you interview potential candidates and choose one, it is time to proceed to the hiring stage. But this process is a set of different procedures, so the right algorithm is a must. Here are the recommended steps for hiring a dedicated team.

![Steps hiring a dedicated development team](https://wise-site.fra1.digitaloceanspaces.com/dedicated_team_steps_8859a9156b.svg)

## Wrapping up

To select and hire dedicated development team, it is not enough just to check technical expertise. The success of any collaboration is also defined by relationships. Try to find people who possess the needed soft skills and see if there is a synergy between you.

People who share the same values are more likely to be passionate about your product idea. In this case, you have the best chance to create a powerful collaborative tandem. As a result, you can trust and shift some part of your burden to the team so that you could focus on other important areas of your business. 
The Wise Engineering team supports sophisticated software development and project management methodologies. We attempt to collaborate in the same way as we would do with our closest friends. We always go the extra mile to help you interweave developers into your internal team and establish a good rapport with the dedicated team. 

[Contact us](https://wise-engineering.com/contacts/) to learn more about how we approach [custom software development](https://wise-engineering.com/expertise/) at Wise and let's discuss the specifics of your future project. 







Check out IT outsourcing trends in 2022, learn when to hire a dedicated development team, and check out aspects that should influence your choice >>

Dedicated software development team. Best practices to hire

Learn what aspects to consider when hiring a dedicated team and when you will benefit from this collaboration model the most.

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At Wise, we love friendly chats over coffee in our office kitchen. This morning routine always helps to tune up for a productive day and usually is accompanied by discussions on some trending topics. One day we had a small talk about the connection between DevOps and business, and this blog post is a continuation of that conversation. We decided to discuss the value DevOps can bring to business, and no one understands it better at Wise than our DevOps engineer Ihor Mozil.

Ihor has 12 years of background in system administration and now 5,5 years working as a DevOps engineer. Ihor’s ability to dive deeply into the problem and learn fast fascinates our team. His persistence helped him grow in his domain in immense steps. Ihor's tech knowledge is very broad, and his major expertise includes CI/CD pipelines, infrastructure, and system security. Also, among other Wisers, he is known for his hobby – Ihor constructs racing drones and flies them as well. He is a mentor at Wise Engineering School, takes an active part in our Tech Talks, and never gets tired of talking about his hobby. 

This interview is not about building drones, which requires great system thinking by the way. Yet it will help you see how DevOps can help you fly your business better. Or, better to say, faster. 

![](https://wise-site.fra1.digitaloceanspaces.com/Dev_Ops_interview_drones_a7ee48fd26.jpg)

## Specifying the nature of DevOps 

**Q. What system administration didn't give you that you headed towards DevOps eventually? **

I. Automation would be the most critical, I suppose. When working as a system administrator, I always looked for opportunities to automate my work. All the repetitive tasks were eating up most of my time, and I always wanted to spare more of this resource for more complex issues. So I intuitively started to automate some processes already in system administration, and then the transfer to DevOps was very logical. 

The ability to minimize human errors is the second reason. No matter how attentive or scrupulous you are, in routine processes that are complex, at the same time, the machine performs better, and the risk of an error is minimized.

**Q. During the five years, did you get the moment that helped you reconsider the DevOps model? And what was it?**

I. In fact, reconsideration and reevaluation are happening all the time, because, as a DevOps engineer, you get new experience continuously working with different projects. Within some projects, you have all the freedom to try new technologies and see their potential in practice. Some projects have extensive legacy parts that give you a lot of restrictions. Still, it makes you think twice harder and make up a working solution from all the minuses you have. This allows you to reconsider the overall process and introduce approaches that simplify complex issues or make these complex issues convenient for other people that work with you in a team.

I can't say this is a process of constant reconsideration of the DevOps approaches, but with time you get to see a more broad picture of how DevOps work influences business development, that’s for sure.

**Q. Are there any myths or misinterpretations of DevOps you’d like to dispel?**

I. The key idea to keep in mind is that DevOps is about the adoption of methods, best practices, and processes, and it is continuous in its nature. Thus, the first misinterpretation of DevOps I would address is that it's not about the tools your team uses. You can not say that by introducing a particular service, you’d have the DevOps processes arranged. This is not how it works.

DevOps strategy is based on setting up effective collaboration between people responsible for creating software and people whose work is to maintain it. Hence, a major task of a DevOps engineer is to streamline this process to help a business achieve goals faster.

### “DevOps engineers are an integral part of the engineering team. Not a separate unit that works in a vacuum.”

Another important aspect is that DevOps engineers are an integral part of the engineering team. Not a separate unit that works in a vacuum. Only if DevOps engineers work closely with all the development team, they understand all the tech context and if they have a high-level business roadmap for at least a year, DevOps specialists can be most effective. If working separately, they can bring only more headaches to a project.

And finally, this comes from what I’ve mentioned above, one should never underestimate the soft skills a DevOps engineer should possess. Communication is vital in DevOps. I always speak of it during the DevOps mentorship program at Wise School. If you can not clearly communicate the value the change brings to the overall development process and the business, this change will never get approved and never happen eventually.

Last but not least, the DevOps methodology has a business focus at its core. And this is critical to understanding both for business owners and engineers themselves. All the optimizations that are about to be introduced face a particular business challenge, and help achieve business goals from both short- and long-term perspectives.

## Business value driven by the DevOps team

**Q. Let’s focus on this part – the business value that the DevOps model brings. If you had to think of one core thing, what would it be?**
 
I. Faster time to market. This is the key task behind DevOps above anything else. Or better to say, everything that a DevOps engineer or a DevOps team strives to achieve is to make sure the software the engineering team builds is delivered to the customers ASAP and the management immediately starts to receive data on how it is performing.   

### “The specific appeal of DevOps is that business no longer has to trade speed for product stability, and vice versa.”

Hence, speeding up time to market should be at the core of any task a DevOps engineer receives and the key aspect a DevOps specialist should focus on when introducing any changes and optimizations. Most importantly, this applies to all – startups, more mature companies, and enterprises. By building a new product or modifying and improving the existing one, the main task is to bring this product or product updates to end-users as quickly as possible, at the same time not neglecting its stability, security, and quality. The specific appeal of DevOps is that business no longer has to trade speed for product stability, and vice versa.

**Q. So there are multiple components of DevOps work that lead to shortening time to market. Can you name them more specifically?**

I. First of all, DevOps creates and automates a pipeline of software shipping to a customer. 

A specific pipeline is created that launches automatic tests after each commit, then automatically or manually deploys these changes to where they belong, assigns QAs to test them and sends it for product owner review, and, finally, deploys them to production. Exactly how long it takes for this process to complete defines time-to-market speed. DevOps engineers’ major task is to speed up this process as much as possible. Gone are the days when deploys were happening once in a quarter. Today engineering teams need to be able to deploy changes to production multiple times a week, if not a day or hour. 

The other aspects that are in the DevOps competence and influence the business maneuverability include:

- Standardization and virtualizing infrastructure assets (servers, databases, testing environments).
- Monitoring and measuring system performance and health, minimizing downtimes.
- Fostering tighter collaboration between all tech teams and sharing resources across tech departments.
- Smooth integration and automation of low-value processes.
- Eliminating ineffective processes and cost optimization. 

![](https://wise-site.fra1.digitaloceanspaces.com/Dev_Ops_interview_portrait_903eded0a4.jpg)

**Q. What are the major business risks DevOps work should address?**

1. Losing market competition

DevOps culture allows businesses, first of all, to win a race with competitors and get more market share in the long run. Because if several companies are operating in the same market, and one of them have all the processes streamlined, and the others need weeks or months to introduce changes, it’s clear who will end up as number one.

2. Lack of relevant analytics

Working on the crossing between technology and business, DevOps engineers can set up custom analytics that helps business stakeholders keep flexibility in business decisions and base them on data rather than predictions. Because with a streamlined software delivery pipeline, your customers get access to your product or its new functionality before the competitors, and as a decision-maker, you need to start gathering data faster and adjust the business roadmap accordingly. 

3. System vulnerability

DevOps engineer analyzes the project for vulnerabilities and suggests the relevant permissions policy for everyone involved in product development. Personally, I practice forbidding access to everything right from the start and, then, granting only those access levels required for efficient work. No more, no less.

4. Lost profit

During the periods when your product or its parts were not available for customers, you lose money, and a business analyst will help you count the exact amount in no time. The efficient work of a DevOps engineer ensures that downtimes are minimized, and if any incidents happen, the work is done to prevent them in the future.

5. Lost opportunity

This is about system autoscaling and downscaling. In today's dynamic environment, you should be sure that if any load increase to your system happens, it can handle it, and once it is over, downscale back so you would not spend extra. Imagine that some celebrity shared a link to your website, and it went down due to the user high load. Would you get such a chance any time soon? Don’t think so.

## Underestimated aspects of DevOps work

**Q. You’ve mentioned previously the importance of communication between DevOps and the tech departments. How can it be arranged and how it may impact the overall teamwork?**

For a DevOps engineer, offering a single solution and stating that this is the only solution and this is what we'll do is a faulty approach at its core. Setting up DevOps processes is about communication and finding win-win solutions for all teams, offices, and departments. Everyone involved.

If as a DevOps engineer, you work with multiple tech teams, you can gather all the tech leads to discuss the solution you are offering. Depending on the project or company size, the form of how you’d communicate will vary. In small teams, creating an RFC document would be good practice. It can contain a short problem description, its technical resolution, architecture, and possible solution. DevOps can share it in a communication channel, ask all counterparts to review the suggested solution and add their comments if this solution is relevant or what aspects are not taken into account. Then in the communication that comes after it, the win-win solution is born – a solution that would address a specific problem and specific business goals.

### “Setting up DevOps processes is about communication and finding win-win solutions for all teams, offices, and departments.”

If the team is bigger the idea of communicating details remains the same, only a more complex document is created, based on it a meeting is set up where all the counterparts decide: what we are doing, why we are doing it, what are the benefits, what project part require modifications to get it implemented.

In situations when an incident happens, DevOps engineers’ soft skills matter the most. In such situations, it is critical not to find people to blame but to make sure all the aspects are examined, and all the necessary work is done so this won’t repeat in the future.

Overall, improved communication across tech teams that can be initiated by implementing the DevOps model leads to more motivated engineers and more productive teamwork. Moreover, the time that a DevOps engineer saves for the development team struggling with any routine inefficient processes can now be used to innovate and helps to take things off the engineering team’s plate.

**Q. How can a business ensure that key information on DevOps settings is well-preserved and transferred when DevOps engineer rotation takes place?** 

I. This is a very extensive and urgent topic. I’ve made some notes on it for my future speech at Wise Tech Talks. But I’ll try to expalin briefly here. 

Knowledge-sharing is a big and important aspect that DevOps methodology drives. DevOps engineer makes sure the project documentation, first of all, is written. This does not mean every single move should be described in detail. No. The documentation describes the project specifics on a higher level. So that every engineer that joins the project after reading it would understand how the system works, what system components are interdependent, how they communicate with each other, and that’s all. A good practice is when project documentation contains information on why particular approaches or technologies were not chosen, and why.

When the change in the DevOps team is taking place, *Infrastructure as a code* is one of the greatest practices that ensure the knowledge is transferred from one specialist to another efficiently. The process of managing and provisioning software infrastructure through code ensures that no settings are made manually. DevOps engineer writes code and via API of some cloud sets up infrastructure and its configurations, and develops the whole CI/CD process through code. When new engineers onboard a project, if they have efficient tech expertise, they will understand how everything works.

Because a DevOps engineer collaborates across tech teams and finds common ground for sharing knowledge, this specialist can also initiate some regular tech discussions, updates meetings, TWIL (*This week I learned*) initiatives, or other forms of knowledge sharing. The management team, then, can turn this initiative into some corporate training programs and help the company embrace the knowledge-sharing environment on a more global level.

![](https://wise-site.fra1.digitaloceanspaces.com/Dev_Ops_interview_knowledge_sharing_93d184f9be.jpg)

## New horizons for DevOps

**Q. What are the biggest challenges DevOps engineers face today?**

That depends on the project, I suppose. I’d speak of the projects I’ve been part of recently.

More and more these days, I come across tech problems that, at first, look very complex. And to solve them properly, you need to dive into business specifics. Such solutions usually require a lot of preparational work, examining similar cases, and finding unique solutions for the specific context by combining approaches that other teams already implemented. So the main challenge, DevOps tasks can not be divided from a business perspective and require a business context that is not always provided from the start.

As we’ve spoken already, DevOps practices can drive a lot of changes. The biggest challenge is to be able to communicate their value to the management and for the latter to understand how all these processes are interconnected. So, openness and efficient communication on different company levels are challenging. I am lucky to work with teams where I can initiate a lot of improvements, and it motivates me a lot.

### “DevOps specialists become the ones who think about multiple aspects even if not asked to do it directly.”

Also, cool DevOps engineers do a lot of volunteer work today. What I mean is that dynamic teams that deal with startup projects can not afford to hire multiple specialists responsible for some deep tech expertise. Such people as DevSecOps engineers, site reliability engineers, FinOps experts, and more. DevOps specialists in such teams become the ones who think about multiple aspects even if not asked to do it directly. Because a DevOps engineer sees how the system operates as a whole and understands its weak and strong sides better. This results in a high workload for DevOps engineers and requires great stress resistance.

**Q. Where is it all heading? Are there any trends that you observe?**

With the numerous new DevOps branches such as DevSecOps, FinOps, GitOps, and others, more and more engineers will dive into narrow expertise. I see both benefits and disadvantages here. I still believe a good DevOps engineer should know a bit from everywhere and have some things that make up most of the tech expertise. 

Another trend is the standardization of DevOps practices, frameworks, and approaches. I believe this is the major trend I observe these days. And Kubernetes plays the major role here. Of course, there won’t be a one-size-fits-all approach developed, but DevOps work will get more systematic and consistent across projects.

One more tendency that is changing the way businesses launch tech products is the emergence of low-code solutions that allow businesses to create tech products without hiring an engineering team. This applies only to some cases. But still, the rise of low-code solutions influences the market, and the way tech businesses start their journeys. What I mean, is that not every team should worry about the DevOps model from the start. This also helps companies to test business hypotheses faster, and this is great.

I also believe that no matter what the future holds for tech businesses, DevOps will continue to become more and more connected with a business perspective and, thus, will pivot a lot. The great thing about DevOps is that its maneuverability allows you to fly those routes that you thought were out of reach before. You just need the right team on board.






Our DevOps engineer Ihor Mozil speaks of the value to business the DevOps model can bring and the main aspects that influence its realization.

Interview with Wise’s DevOps engineer: Business value of DevOps

A conversation about the business value of DevOps

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Check out a list of the best mobile commerce apps, learn how they deliver value, and get some inspiration for your future projects >>

Top 10 Best Mobile Commerce Apps: Best Cases

Check out a list of the best mobile commerce apps, learn how they deliver value, and get some inspiration for your future projects.

Top-10 Mobile Commerce Apps. Best cases

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Wise insights

How to define what goes into an MVP and where to draw that line of features that everyone would love but that would, still, go later? This is a very common question by entrepreneurs who start considering [MVP development](https://wise-engineering.com/expertise/mvp-development/). Including multiple *killer features* in the minimum viable product, startup founders trap in MVP overengineering, spend too much time and resources on implementation, and as a result, fail in the core tasks behind the MVP step. 

What to include in the MVP is a dilemma we talk about in this post. Based on our experience launching and scaling tech startups, we’ll give you some hints on how you can avoid the never-ending must-haves list of features and focus on what’s truly important when you build an MVP. 

## Why is scoping essential in the MVP development process?

The basic idea of MVP product development is to create a product version with the most essential feature set as quickly as possible to get feedback from potential customers and expand the product based on it. This statement hides the reasons why scoping is an important step of the MVP development process.

With the help of MVP you can evaluate the hypotheses you have on the problem that your product solves or innovative approach to a common issue it offers, or check if client persona was defined properly. An important insight that might help here – you can not test multiple factors at once. Scaling down the amount of things you test during the MVP step adds clarity and helps receive more accurate data. Thus, the functionality you include in an MVP should address the hypotheses you validate with an MVP. No more, no less. 

Secondly, the more functionality you include in the MVP development project, the longer it takes to implement. And the time you spend on developing the product might cost you the overall project success. You need to move fast and bring an initial product version to the audience prior to the competitors.

The development cost is another issue that can not be overlooked. The price for the engineering services will be defined mainly by the scope of work and its complexity, including design complexity, platform number, and required integrations. So trimming down the feature set will not only serve the business goals better but will help you stay within reasonable budgets.

Learn more about MVP development essentials and make sure you’ve developed a [true MVP mindset](https://wise-engineering.com/blog/post/how-to-develop-a-true-mvp-mindset/) before you start planning this step.

## How to decide what to include in an MVP?

The key idea – scoping MVP development does not start with the list of features. It starts with the question – what problem do we solve and for whom?

From our experience, the main mistake startup businesses fell into is that they misinterpret the purpose of MVP development. It is not about deciding what functionality is the most important, start building a product from it, and iteratively add more functionality to build a robust product. Developing an MVP you aim to bring your customers from point A to point B using minimum features, see if their problem is solved, and get feedback. The next step would be to improve the initial business concept, repivot it to serve the client’s needs better, and modify the product based on the data received after each iteration.

![MVP development process](https://wise-site.fra1.digitaloceanspaces.com/mvp_scope_product_development_69aa6e58cb.svg)

Product value is the next aspect we recommend formulating precisely before making any tech decisions. When dealing with MVP development, you should never underestimate the value your product will have and not focus only on the minimum part. Define the value proposition at that step where you currently are and make sure MVP can bring this value to the first users. The feature set for the MVP development should contain that product hook that will make them move forward, take your product for a spin, and leave feedback on their experience.

## Where to start the evaluation process?

Thus, if you treat MVP as a product version that allows your customer to solve a particular kind of problem, that’s a great start. To proceed, you will need to define a critical user path that will allow your future customers to move from state A to state B with no complications on their way.

For example, if the system requires registration, for the MVP step, you can select one authentication method via Google for the start, rather than provide several options right away. This approach is called Minimum Marketable Flow, and you can learn more about it from our previous post on [tech stack for MVP development](https://wise-engineering.com/blog/post/tech-choices-in-startup-mvp-development/).  

Another approach is to create a prioritization matrix that will help divide the features you’ve had on the MVP development list in terms of the value they bring to the end-users and the computing efforts their implementation requires. Your MVP should contain only the functionality that brings the most value and require the least engineering efforts. As for the features that bring value but a more complex in implementation, you might want to consult with your tech and design teams on how to simplify them for the MVP development step.

![Feature set evaluation in MVP development process](https://wise-site.fra1.digitaloceanspaces.com/mvp_scope_evaluation_e797c18436.svg)

## Can scoping workshop shorten the work on MVP?

Scoping workshop is another great initiative you can either undertake by yourself or with external help. It will help to go through the product concept and idea in detail, create a problem statement, and define the value proposition. After that, it would be easier to work on user journeys and simplify them to the most vital functions that you will then include in the MVP scoping document.

Scoping workshop will be most beneficial if you include your tech team in it. No matter what form this would be – a cross-teams meeting, brainstorming session, or any other format, this workshop is successful if on the outcome you receive:

- Clear roadmap and development directions that include user flows, user cases, and feature set for MVP development. 
- Defined roles and responsibilities for all the team members required for the engineering phase.
- Scope translated into technology. Answers to the questions on the tech stack, required platforms, integrations, and other tech aspects.
- Suggested delivery order, as well as time and cost estimates. 

Make sure you don’t take the scoping step lightly, as MVP simplicity is, in fact, rather complex. It requires a lot of planning, scoping, and prioritizing. From our experience, starting with the scoping workshop helps move along the MVP development step more effectively, for sure.

![Scoping workshop in MVP development process](https://wise-site.fra1.digitaloceanspaces.com/mvp_scope_workshop_38b0902f25.svg)

## How we approach MVP scoping at Wise Engineering?

We always start with the business idea and precisely define the core value behind the product we will provide MVP development services for. This gives out team clarity during all further steps. Sometimes we convert comments into immediate project requirements, in other cases, we initiate the scoping workshop to prioritize the project roadmap.

From our experience, the most effective way is to start communicating directly right away, working with the unique context of a business and all the influencing factors. [Contact us](https://wise-engineering.com/contacts/) to discuss how we can help you get your MVP off the ground, and let's make this new project your next big thing. 





Learn how to include just enough features in your MVP to get the most out of the MVP development process step. Our tech team shares experience on the topic >>

Scoping out the work for the MVP development process

Learn how to include just enough features in your MVP to get the most out of this step. The Wise team shares experience on the topic.

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The mobile app market is highly diverse. Yet, if looked closely, apart from the fact that mobile applications offer unique features not available via other channels, usually the most successful ones often specialize in one or a few unique purposes. In other words, they have a unique product value behind them. 

MVP for mobile apps helps validate the startup's main idea or product value proposition and create an app that would be useful, widely used, and, hence, well-monetized. The specifics of the mobile app MVP creation hide in the fact that in the case of mobile apps, [MVP development](https://wise-engineering.com/expertise/mvp-development/) is more about analysis, planning, and strategy rather than complicated engineering. Let’s explore this insight more precisely so that when you decide to start developing your business idea, you will be well prepared.

## Guess less and get data instead

What is a mobile app MVP? A Minimum Viable Product is a workable app model that can execute its core functionality. MVP technique is rather useful if done with critical thinking and accurate planning. Besides, an app MVP should be built in a timely manner and contain just enough features to satisfy potential customers and collect their feedback to plan the next product versions. 

MVP allows businesses to collect data on the target market, validate hypotheses before investing many resources into it, and plan further steps based on the information they receive.

![benefits for mobile app MVP](https://wise-site.fra1.digitaloceanspaces.com/mobile_app_MVP_benefits_782546c9ea.svg)

We recommend tech businesses to start with an MVP development in the cases when:

- A new mobile app demands a different behavior from customers in a given context.
- You need to validate if the solution you are offering to a particular problem is acceptable.
- The product value is not that innovative but the UI for the app differs from similar solutions on the market.
- You want to develop a product iteratively and create a lean startup business model.

To sum up, regardless of the goal you want to achieve with this step, as long as you have the [right MVP mindset](https://wise-engineering.com/blog/post/how-to-develop-a-true-mvp-mindset/) for you and your team and understand why an MVP is built in the first place, you will be able to take the most value from it for your business.

## Before making any tech choices
In the case of MVP for mobile apps, the more carefully you approach the initial phases of MVP development, the faster your tech team will be able to implement your ideas and the more relevant data you will receive. Here are the most impactful decisions to make before starting any tech consultations.

### Define app value for end-users
How your new mobile app delivers value to your target audience is the key idea to keep in mind when starting any activities. This is a foundation for all further activities related. If you have the product value well defined first, you will clearly understand what hypotheses you need to validate and, most importantly, what functionality you need for it.

- Make a list of the core assumptions about the new application, the problems it addresses, and how it solves them.
- Analyze your competitors for more insights and formulate a more competitive edge over the existing solutions. 
- Define what is already viable on the market and formulate a unique value proposition that will help your app stand out. 

### Decide on app monetization
You might not include monetization implementation during the MVP development step, yet, it would be good to know for the tech team where you are heading and plan the app architecture accordingly. It is much easier to consider the chosen monetization approach at the initial stages than to integrate it out of the blue when the app logic is already implemented.

The most common monetization models include:

- **Free and paid app versions**. Usually, the free version has somewhat limited functionality or some data storage limits, if compared to the paid version.
- **Free app with in-app purchases**. The main app features are free, but some premium or extra features require payment.
- **Free app with subscription plans**. The app is free to download with some limited access and via the purchasing of subscriptions, the functionality can be extended.
- **Paid app**. The only paid variant is available for apps, a common model for productivity apps, for example.

Of course, the chosen approach can be changed after the MVP is launched and you receive feedback, yet this applies to every part of the app, and you and your team should be ready for this. 

### Outline basic marketing strategy

Thinking that great apps sell themselves is misleading. No matter how unique the value your app provides, there are always many other products fighting for the same users’ attention. Before starting to discuss the MVP implementation it would be helpful to have a roadmap for marketing activities as well. 

As a marketing strategy is based on specific objectives, goals, and deadlines, the tech team and project managers will be able to understand all the marketing context for the project and act accordingly. For example, make sure the application is prepared for the potential increase of users when big marketing campaigns start. 

At this step, you might also want to plan the tasks for your marketing team. The usual pre-launch marketing can include:

- Creating a landing page focusing on the app offer and aiming to capture users’ attention. 
- Preparing a press kit for your app (short review guide, screenshots, and video presentation)
- Materials to prepare for app release on App Store and Google Play (app description, screenshots, onboarding guides).

### Define success metrics for mobile app MVP

Defining how you will measure the success of your MVP project will help both your management and your tech teams make informed decisions on future steps. From our experience, teams that have shared the unique KPIs in the earliest stages more clearly understand the goals behind the MVP phase and collaborate more effectively.

Here are some important metrics to watch closely during the development of MVP for the mobile app:

- **Conversions** (for example, from a landing page visit to the app download, from installing to active using)
- **Customer acquisition** over a period of time
- **Active users** (number of people actively using the application)
- **Churn rate** (the percentage of users who uninstalled the application during a given period of time)
- **App performance metrics** (average load speed, crash reports, and more)

## Main steps in mobile app MVP development

Depending on the app idea, market specifics, business context, required functionality, and other essential parameters, the flow can be somewhat customized for each specific case. Some apps are more simple and require less planning, others demand complex analysis, both business and technical. Hence, some of the phases can be extended or shortened respectively.

On the high level, here’s how we approach the MVP development for a mobile app at Wise Engineering.
![mobile app MVP roadmap](https://wise-site.fra1.digitaloceanspaces.com/mobile_app_MVP_roadmap_6af86d0a37.svg)

### Product discovery

In the case of mobile app MVP development, the better the planning is done, the faster the tech team will cope with the implementation, and the more valuable data the MVP step will produce. That is why we always pay attention to this step and suggest you do the same. 

Essential questions that require answers during product discovery:

- Who is your target customer?
- What problem does your app address?
- Who are your competitors and what is their value proposition?
- How do you plan to monetize it?
- What distribution channels will be there?
- What are the deadlines (time-to-market planned)?

At this step, we start to map out what the app should do and how it should function. Raw wireframing will help to understand the entire user journey and uncover possible complexities that will be taken into account during the tech consulting step.

### UX & Design

One of the main tasks at this step is to assemble correctly the minimum marketable user flow for your future application. The **minimum marketable user flow** contains just enough features that allow users to take the app for a spin but do not include any extra functionality. We’ll talk about how to assemble the feature set for an MVP further. 

At this stage it is important to pay attention to the intuitive UI as with mobile applications, users are not used to reading any documentation and guides. Simple onboarding is all you can expect from them, yet people still tend to skip it very often. Thus, only an intuitive UI will ensure they proceed further after the installation. 

Mobile app design is another aspect. You might not want to invest a lot of resources in developing brand visual identity at this step, which is common practice with MVPs. Some basic brand identity like a simple logo, color scheme, and unified fonts would be more than enough. Consistency is the main rule here. After the MVP phase is over you’d be able to work on product design more attentively.  Here’s how our team helped to improve the brand look for a [podcast recommendations platform](https://wise-engineering.com/case-studies/podnods/) after the MVP launch.  

We also advise design teams to create clickable app prototypes, in <a href="https://www.figma.com/prototyping/" target="_blank">*Figma*</a> or <a href="https://www.invisionapp.com/cloud/prototype" target="_blank">*InVision*</a>, for example. This helps to spot inconsistencies before the software is already under development.

### Tech consulting 

Once you have the design and prototypes ready, you can start discussing the technology more precisely. Of course, some tech choices can be done somewhat earlier, but the UI/UX components influence those decisions definitively.

This step starts with a document creation containing a list of technical requirements and proceeds with consultations with a variety of specialists. Including system architect, tech lead, project manager, and other engineers whose opinions would benefit the project. The team depends on the project complexity and does not always require a lot of time. 

At this step, it should be decided what approach native mobile app development or cross-platform you will apply. When making a native vs cross-platform approach, we advise considering:

- Application complexity
- Available budget
- Development time
- UI/UX components

After the development approach is selected, the tech stack composition becomes rather obvious. Swift for iOS app development, Kotlin for Android app development, if you go the native way, and React Native or Flutter if cross-platform development is planned. Plus, the list of necessary integrations and 3-rd party services will be assembled. 

### Back-end development

This step is optional and depends on the functionality selected for the MVP development. Some MVPs with simple feature sets can be launched without back-end development. Yet, for the mobile apps that process user data, store them, and need to ensure their security it is inevitable. The back-end of a mobile application functions as a server for users to sort the information they add to the app.

The basic feature of the mobile application back-end include:
- Authentication
- Database
- Scripting
- Architecture
- Automatic synchronization
- Push and email notifications
- API console
- Analytics
- User management

### Mobile development

At this step, the mobile development team starts design implementation based on the API and back-end configurations. Our mobile development team says this is the easiest part of the entire mobile app MVP development process if all the previous steps are done efficiently.

To cope with the step successfully, the tech team needs to understand how to develop high-performance and reusable UI components that are in line with the App Human interface and Material guidelines. The 3rd-party integrations are also being built and configured at this step.

### QA & release

An accurate testing process ensures the delivered functionality meets the high standards of mobile app development. At Wise Engineering, for example, we pay thorough attention to creating testable, maintainable code that allows us to easily incorporate new functionality and set up rigorous testing processes.

We also assist our clients and handle the entire approval process for both App Store and Play Market applying best practices we’ve learned developing mobile applications for our customers for 8 years.

Note, that after the official release of the mobile application, the iteration process starts over. After the feedback is collected and analyzed, your MVP development team will start working on the improvements.

## Common mistakes to avoid

While the roadmap for each specific case of mobile app MVP development differs, the traps startups get into are rather common. Let’s look more closely at the aspects businesses tend to underestimate at the MVP development step.

### Lack of focus

Features overload is the key reason MVP fails. And what exactly is meant by an MVP failure? Few people bought a subscription, the project was not profitable, and there were few conversions? Are these goals even applicable to an MVP development phase? Not quite.

Idea validation with minimum resources spent and at the shortest time possible is the main goal behind any MVP. Thus, it requires focusing on the app's core functionality that helps users to test the application and define if it helps to solve their problems and leave feedback on how the product can be further improved.
 
To make the decision on what to include in the MVP version, we advise creating a prioritization matrix that helps to filter out all the functionality you have in the lists in terms of the value they bring and the technical effort they require. Thus, features that bring the most value and are not that complicated to implement are the first to include in the MVP feature list. The functionality that brings value and is somewhat more technically complicated should be discussed. Do you have the time and resources for its implementation? The features on the lower part of the matrix can be postponed and planned for implementation for the next app version.

![feature set for mobile app MVP](https://wise-site.fra1.digitaloceanspaces.com/mobile_app_MVP_feature_set_f68c9ac90b.svg)

### Not thinking long-term 
When planning an MVP with our clients we include a number of questions that help us understand how stakeholders see further product development on a high level. This helps us make tech decisions that would benefit the project in the future. 

For example, understanding the possible planned next steps after the MVP launch helps to make decisions in favor of native or cross-platform mobile app development. If long-term perspective is not taken into consideration, there can be mistakes in tech choices, and changing either a tech stack or app engineering logic always takes time and resources to fix.

Clearly, there will be pivots after the MVP launch, but they are more connected to adapting the functionality to serve the users better, introducing new features, and customizing the existing ones. These changes can be implemented fast if your tech team thinks a bit in advance within your business context. Check out how we approach [tech stack architecture for MVP development](https://wise-engineering.com/blog/post/tech-choices-in-startup-mvp-development/) at Wise Engineering. 

### Forgetting the analytics

In the previous blocks, we’ve discussed the main goal for creating an MVP – validating a business idea within limited timeframes and resources. Thus, to make the most of the minimum viable product, gathering the analytic data is vital.

With each of our clients, we always discuss if the data they receive from, for example, Apple and Google markets’ analytics is efficient or whether we need to configure other services that would help understand how users interact with the application better. For example, this may include app heatmaps and behavior funnels to monitor in-app behavior.

Along with qualitative data, it is important to collect qualitative information. For this, make sure the MVP app version includes in-app feedback widgets, subtle click-to-choose options integrated into the app interface. They help users share valuable feedback after they, for example, completed a series of actions.

### Inefficient stakeholders’ involvement 

If one believes that they can give their tech team a task and come back in two months checking the results, they are mistaken. From our experience, the more involved the CEO or founders are in the development process, the faster the product in the desired state is brought to the market.

We do not say you need to be there to clarify every slightest nuance. Of course, all the routine tasks would be taken care of by the project manager, but every now and then engineers should be able to discuss significant aspects, suggest optimizations, and clarify requirements. This can be done during weekly demos, for example. 

At our company, we are very proud of the collaborative approach we’ve developed with our clients. Setting up an effective communication loop between all the counterparts is critical for us. Read more about how we adapted the [new communication model in software development outsourcing](https://wise-engineering.com/blog/post/new-communication-model-in-software-development-outsourcing/). 

## Development team for mobile app MVP 

Your dedicated team for the project might consist of a variety of specialists, all depending on what mobile application you are about to create. Typically the team includes:

- Project manager to plan and coordinate the team's work.
- Designer to create app prototypes and develop a brand visual identity. 
- If you opt for a native development approach: web engineer for API and back-end development (if it is required for the selected feature set) and iOS and Android developers.
- If you select creating cross-platform, the work on one application will be shared between the front-end and back-end engineers.
- Depending on the application, the DevOps engineer to set up the engineering environment for continuous integration and delivery.
- QA engineer for mobile application testing.

Yet, this does not mean that you should hire a team of fifteen people to launch an MVP. In most of the cases at Wise Engineering, teams of 3 to 4 manage to deliver great results for our clients. For example, here’s how in a small team we created a [cross-platform mobile app for contractors](https://wise-engineering.com/case-studies/blue-collar-lists/) in the USA.

To calculate the mobile app development cost, multiple project aspects are taken into account. The chosen development approach (native or cross-platform), feature set complexity and design components are the key factors that influence the price. Thus, a simple app that serves one key function will cost less and, if planned correctly, will drive value with a rather small investment. More complex development, clearly, will require more resources. During the product discovery phase, we help our clients define functionality and approaches that would bring the most value and omit those engineering efforts that drive less tangible benefit.

Our team is open to new projects in the native mobile development or cross-platform development domains and would gladly provide you with tech and business consultations.
[Contact us](https://wise-engineering.com/contacts/) to book a call with our business development team and start moving towards your goals with an experienced tech partner.



Learn specifics of MVP development for a mobile app. Stay prepared for the hidden challenges before making any tech choices and after development starts.

From idea to MVP for mobile app | Wise Engineering Blog

Learn specifics of mobile app MVP. Be prepared for the challenges before making tech choices and after development starts.

From idea to MVP for mobile app

marketplace_MVP_preview.svg

Over the past 15 years, our company has been collaborating with startups across the globe on launching and scaling their marketplace businesses. Working across industries, we now clearly see how the concept of a marketplace startup has evolved recently. A marketplace platform is no longer a place for selling physical goods exclusively. Custom marketplace-like businesses are now aiming at solving complex problems, allowing vendors to bring their creativity, digital products, and a variety of services to broader audiences.  

This blog is a summary of our thoughts regarding the [MVP development](https://wise-engineering.com/expertise/mvp-development/) of the marketplace app. From our experience, the MVP step helps to quickly validate the ideas and make necessary product pivots before the actual product development starts. Here’s how you can organize this step for your project more effectively.

## No one needs another marketplace

However sad it sounds, with the shift towards branded marketplaces, only companies with the mission and specific problems they are addressing can count for users’ attention and favor. 

How does this relate to the MVP development phase? The answer is simple. If you’re launching a regular marketplace the same as myriads others out there, what’s the point of developing its MVP? What is there to validate with a minimum viable product? You can select one of the ready-made E-commerce solutions and start a business.

But if you have a specific idea in mind of how you can connect different people and solve challenges they are facing, you need to see if this idea receives traction. For this, analytics data and client feedback would be valuable and help you understand how you should change the initial concept to make it more useful and, hence, profitable. 

The success of marketplace business in the post-covid reality requires more than an easy-to-access shopping destination. A successful marketplace today is no longer a place having *everything for everyone* but rather a platform connecting specific vendors, addressing specific problems aimed at specific audiences. Learn more about the [evolution of marketplace app development](https://wise-engineering.com/blog/post/5-shifts-defining-marketplace-development-in-2022/) from our previous blog post.  

![Marketplace platform development](https://wise-site.fra1.digitaloceanspaces.com/marketplace_mvp_role_badc092520.svg)

To better define the needs of this specific audience and provide better solutions to the problems they are facing, you need a marketplace MVP. 

Consider launching an MVP if you need to:
- Bring your idea to the market quickly to see if it gets traction
- Learn from the audience feedback and introduce customizations
- Build a product within the fixed budget and timeframes
- Showcase platform concept to stakeholders

Check out our recent post on [MVP mindset](https://wise-engineering.com/blog/post/how-to-develop-a-true-mvp-mindset/) to be more prepared for the planning step.

## Feature set for the marketplace MVP

A minimum viable product, or in the case of marketplace development, a minimum viable platform is a custom solution that solves the core problem of the target audience and meets the key expectations of all the sides of the marketplace – vendors, customers, and business owners. 

The success of any product, and marketplace platform is no exception, is the unique value proposition it offers. With the marketplace model, this value proposition should be formulated for both sellers and buyers. And only after the value proposition is defined the core features set for an MVP can be assembled. For each business, the value propositions, and thus, the unique features set for an MVP will differ, but if to look at this aspect from a very high-level perspective, there are some common patterns.
- **Value propositions for vendors** should contain the ability to market the products or services they produce. Each vendor needs the ability to customize their profile to bring their unique proposal to the platform’s visitors.
- **Value proposition for customers** should include an efficient search experience on the platform that delivers specific product or service variants for a peculiar user. Ability to compare vendors, select the best matching variant and make a purchase quickly. 

As** for business owners (or administrators)**, the key functions will include the moderation of all the counterparts, as well as efficient analytics on how both vendors and customers interact with the platform, at what steps of the UX there are problems, and what workflows work best. 

To sum up, the feature set for the marketplace MVP should allow all the counterparts to fulfill their ultimate goals on the marketplace platform, and depending on the product type, industry, or any other specifics these features will vary. The important thing to understand is that the better you formulate your value proposition for the specific audience, the easier you define the workflows you want to test and definite the features to implement during the MVP development step.

![Feature set for marketplace MVP](https://wise-site.fra1.digitaloceanspaces.com/marketplace_mvp_feature_set_bc41872e75.svg)

## Functionality requiring special engineering expertise

Depending on the main idea behind a custom marketplace, the functionality that would require the most engineering efforts will vary. From our experience, the aspects listed further can become one of them.

### Online payments

Along with the defined problem your business addresses and value proposition for the target audience, at the MVP development for startups it is vital to decide on the business monetization strategy that can be realized via:

- Commission fee
- Subscription plans
- Paid listing
- Advertisement

Besides, to enable purchasing on the marketplace, the platform should be connected to at least one payment gateway. Taxing & invoicing, split and recurring payments, payouts, inventory management, online payment security, and compliance are other aspects to consider in advance and require expertise from the tech team in charge of the MVP development.

### On-site search
E-commerce search is important when your business relates to the user-generated content, digital products, service line, or product catalog that is hard to categorize.

This functionality is beneficial for both end customers and vendors. For the first, the more relevant the search results delivered, the better user experience is provided. <a href="https://blog.hubspot.com/blog/tabid/6307/bid/14953/what-do-76-of-consumers-want-from-your-website-new-data.aspx" target="_blank">76% of website visitors</a> think that the key UX factor on a website is how easily they can find the necessary information. For vendors, the relevant work of the on-site search engine ensures fair competition on the marketplace platform. 

Of course, all the advanced search customizations of the internal search are out of the question at the MVP development step, but some features require minimum engineering efforts but greatly enhance the customer experience even at the initial steps. They include:

- Autocomplete for the search queries. 
- Sound-like and synonym search. 
- Fuzzy search (ignoring typos, plural and case forms, and more).
- Faceted search and filters. 

Learn how the [E-commerce search](https://wise-engineering.com/blog/post/e-commerce-search-budgeting--where-to-invest-first-/) can be developed across development iterations.

### Product-specific requirements
A lot of functionality that is developed at the MVP steps depends on the unique business idea. The more complex the products presented on the platform, the better you need to plan the platform's architecture for further scaling.

If you are creating a marketplace for some digital content, videos or podcasts, for example, separate attention should be paid to creating a video upload and playback library and the platform’s infrastructure. If you know that there are some marketing campaigns planned, your tech team should prepare the system for the expected number of visitors and higher system load. With any other business context or requirements list, the tech aspects that would require more attention will vary. 

Learn more about how to approach [tech stack planning for the MVP development](https://wise-engineering.com/blog/post/tech-choices-in-startup-mvp-development/) step.

## Roadmap for marketplace platform MVP development

To bring the expected results, the MVP development step should be thoroughly planned. This phase should contain only the development of functionality that allows users to test the platform from start to the desired state but not with multiple options on their way. This approach is called Minimum marketable user flow and, from our experience, helps to avoid over-engineering and speeds up the launch significantly.

The infographic below summarizes how the marketplace MVP step is usually organized when our team is involved in the engineering process.

![Roadmap for marketplace MVP](https://wise-site.fra1.digitaloceanspaces.com/marketplace_mvp_workflow_24293304f9.svg)

## Marketplace businesses we helped to launch
Here are some inspiring startups that are based on the multi-vendor marketplace concept – bringing creators closer to their specific audiences. Our team is very proud to be part of their success stories as the mission behind each of them is impactful and inspiring.

### Online auction and events marketplace

One of our clients decided to challenge the regular entertainment opportunities like visiting a concert or sports event and decided to launch a marketplace of exclusive experiences and an online auction. Together with the Wise team, they developed and successfully launched an MVP for a marketplace and now are a fully operational and successful business that managed to survive even the covid pandemic that was devastating for the whole entertainment industry.

Read full [case study on marketplace MVP development](https://wise-engineering.com/case-studies/granted/).

### All-in-one platform for fitness chain

Another Wise client addressed the challenges the covid pandemics brought to the sports and fitness industry. As people were not able to train offline, the platform creators decided to help fitness trainers adopt new approaches to collaboration with their students. 

The platform was designed to allow trainers to monetize their efforts in creating virtual workouts and online personal training programs. With the tech assistance of the Wise team, our client received the MVP of the digital fitness platform in 3 months and launched the platform’s 1.0 version with significant improvements and extensions in another quarter. The collaboration with the fitness trainers as a focus group throughout the development process contributed greatly to the project's success.

Read full [case study on MVP app development](https://wise-engineering.com/case-studies/core/).

## What is your idea?
Outsourced marketplace app development services open great opportunities for startuppers today. With a clear vision of what you need to validate at the MVP step and the right tech partner at your side, you can test your idea with reasonable investments and within a strict time frame. 

Contact us to discuss the business context for your marketplace business. We’ll help define the core platform functionality and all the tech aspects to consider at the initial steps, including tech stack assembling, team augmentation, and more. 







This blog is a summary of insights on marketplace MVP development we received launching marketplace businesses for our clients during the last 15 years.

MVP development for a marketplace platform

Consider the specifics of the marketplace business when launching its MVP. Our team shares insights based on our experience. 

MVP_tech_stack.svg


To prepare this article, we consulted two full-stack developers and a DevOps engineer who were all part of the dedicated teams that collaborated on [startup MVP development](https://wise-engineering.com/expertise/mvp-development/) for several Wise clients. Our aim with this publication was to prepare a handy collection of insights our team received working with real businesses and addressing new challenges in the post-covid environment.

The key idea we would like to communicate is that there is no *best* or *right* technology stack that would suit any tech product type, be it a mobile app, web application, or SaaS product. If you see this type of narrative in the title or introduction of the article, podcast, or video tutorial, you can freely skip it, as they would be misleading. The truth is, the one-fits-all approach is elusive and there is no *right* or *best*. Though **there are criteria to consider, jobs to be done, people to involve in the process, as well as mistakes to avoid along the way**. We’ll focus on these aspects in this blog.

## Before discussing the technology

Prior to starting any considerations related to the technologies you will use, make sure you’ve developed the <a href="https://wise-engineering.com/blog/post/how-to-develop-a-true-mvp-mindset/" target="_blank">right MVP mindset</a> and have a clear understanding of what you’re about to build and, most importantly, why. 

The key ideas you might want to keep in mind:

- MVP is not a prototype. Users should be able to fully understand the product concept and take it for a proper ride.
- MVP is the best way to test your product with minimum investments. 
- Testing means you need to set up an agile development process when you release new functionality constantly.
- Success metrics for your business should be clearly defined. 
- The big goal behind the MVP can change. The ability to respond flexibly to the findings you receive is your superpower.

Furthermore, let’s define what is meant by tech stack for the startup MVP development. A **technology stack** is a combination of tools your in-house or outsourced engineering team will use to create a web, mobile, or cross-platform application. There are usually the client-side (front-end) and server-side (back-end) parts. Tech stack can consist of a variety of tools, services, frameworks, and programming languages. The mix is unique to each specific project and should be assembled based on the requirements and business context of each product separately. Of course, you can delegate the technology choices to your tech partners, but there is no harm in understanding the basic principles of how this process should be done efficiently.

Here’s how we approach the tech stack architecture for the Wise Engineering clients and our in-house startup products.

## Start with the right questions

What technology is the best to build a web application? This is a type of question we strongly advise you to avoid. To define the unique mix of technologies for MVP app development, your engineering team should have the mockups in front of them, and the discussion should begin with the following questions: 

- What is the core product functionality?
- Who are the users? Where are they located?
- What type of data should be processed? What is their structure?
- Are there marketing campaigns planned? When do we expect user base growth?
- How soon will we need to expand the engineering team?
- What are the time restrictions? Are there due dates set?

All of the aspects above can be broken down into two major categories:

1. **Functional products requirements** (*read: what the product will do*). For example, how users will interact with the system, how the platform will respond, authentication steps, what transactions will occur, and more.
2. **Quality system or non-functional requirements** (*read: how the products will perform*). For example, how fast the system should perform certain activities, what availability is expected, how dependable the system is, what limits systems should handle, and more. 

When it comes to MVP engineering, the non-functional requirements will influence the tech stack choices most of all. Because there are numerous options of how you can realize different features, and, at the same time, when there are high requirements towards security, maintainability, app scalability, and similar, the options range will narrow down significantly.

![Functional products vs quality system requirements](https://wise-site.fra1.digitaloceanspaces.com/requirements_influencing_tech_choices_4b781b7ab6.svg)

## Avoid over-engineering

In <a href="https://innovationfootprints.com/wp-content/uploads/2015/07/startup-genome-report-extra-on-premature-scaling.pdf" target="_blank">74% of cases</a>, premature scaling leads to startup failure. Let’s define what is meant by *premature scaling* or *over-engineering.*

**MVP over-engineering** happens when a product acquires more features and advanced setups that the business really needs at the MVP development step. This further leads to the situation when a company's revenue from new users acquisition is lower than the cost of maintaining the system itself. The understanding that, before everything, you create an MVP to build a profitable business and a tech stack only gets you there helps not to fall into the premature scaling trap.

When engaged in MVP development services for startups, the key suggestions we give our clients are the following:

- Do not start MVP web development by writing numerous microservices. This increases debugging time and prolongs the overall development time. You can rearrange the system into microservices gradually after the MVP engineering step is over and you proceed with actual product development. 
- When deciding on creating any functionality from scratch applying reasonable buy vs build thinking. Using ready frameworks or services helps decrease product time-to-market and get feedback from the audience faster. Of course, ready-made solutions have lower customization capabilities but do you need that advanced setup to validate the idea and get traction from your MVP? The speed factor wins the competition in most of the cases here.
- For the MVP tech stack, we also recommend selecting up-to-date but proven technologies with extensive engineering communities and an efficient number of developers using them. Of course, using the latest frameworks or programming language is tempting for developers, but this is not the case for your business. You need a stack that consists of proven technologies without any hidden contexts. Plus, once your product scales, hiring more people to the team won’t be an issue.

This, of course, does not mean that the tech stack you select should be simplistic or clunky. Your engineering team should keep the high coding standards and build a system that addresses the business challenges you face and help you achieve your long-term goals.

## Define core functionality and stick to it

There is always a temptation to add one more option or more customization to the existing functionality. Yet, for the MVP development step, this is the point where you start to lose focus. 
To enhance or expand any feature, you need clear and continuous feedback from the audience that they really need it. If the idea to add more functionality belongs to anyone from the team, think twice before adding the task to a backlog.

When the Wise team deals with the MVP development, we focus on building minimum marketable user flow exclusively. **Minimum marketable user flow** is the simplest feature set that reflects the unique selling proposition of the future product. This is a predefined user flow that allows testing the product from start to the desired state, yet lacks multiple options of how this state can be achieved. We usually have the additional flows documented, but our primary focus never shifts.

![Minimum marketable user flow](https://wise-site.fra1.digitaloceanspaces.com/minimum_marketable_user_flow_725aafa6ad.svg)

We described how to generate a <a href="https://wise-engineering.com/blog/post/how-to-develop-a-true-mvp-mindset/" target="_blank">minimum marketable user flow for an MVP development</a> in one of our earlier blog posts.

## Consult DevOps before writing any code

Developing and deploying an app constantly and at a fast pace is an integral part of the MVP development process. A DevOps engineer enrolled in the team at the initial steps will set the grounds for an efficient Infrastructure as a Code environment and help your engineering team move along the project roadmap smoothly. The base that will be set at this step will help avoid rearranging the overall system once the scaling is required. DevOps engineers help you think long-term and plan the product architecture for further development and minimize the risk your system will be unable to perform later.

The key task for DevOps at this stage is to allow the product and engineering teams to react flexibly towards the feedback they receive launching an MVP. DevOps engineer is responsible for:

- Setting up Continuous Integration and Continuous Delivery to allow engineers to deploy changes to the product quickly.
- Building a highly available and fault-tolerant system that will allow you to quickly modify or update the application without downtime.
- Orchestrating the engineering team and ensuring wide-scale collaboration across all people involved in the MVP development.
- Setting up system monitoring and autoscaling to prepare the application for any unexpected system loads.
- Initiating product documentation (we’ll talk about this aspect in more detail further).

Learn how we arranged the product architecture when launching <a href="https://wise-engineering.com/case-studies/granted/" target="_blank">auctions and events marketplace</a> from the case study.

## Find time for project documentation

Teams dealing with startup launches understand that time-to-market is a vital metric and do everything to reduce it. Still, sparing engineering time by neglecting the aspect of product documentation will negatively impact the development speed soon after new people start joining the team.

A good practice is to start product documentation at the tech stack selection step. You can include the following information:
- What technology did we choose for a specific task?
- Why did we make such a decision?
- What technologies did we consider but didn’t select, and, most importantly, why?  

This information will be useful for every new member of the project and save time on R&D steps if similar issues arise again.

At Wise, we are very attentive to product documentation, yet always define a reasonable time to create it. We also recommend keeping up the fast development pace with the efficient environment for code deployment, focusing on user flow that communicates unique product value and not by keeping all the information in the minds of people currently working on the project.

## Collect data from day one

Analytics is at the core of the overall MVP idea. You build a minimum viable product to test your hypothesis which is impossible without relevant data collection.  

Before starting any steps with MVP planning we always suggest our clients define success factors for their MVP – unique KPIs for their particular business context. These could be both quantitative and qualitative metrics, and it is important to share them with the whole team. From our experience, when everyone involved is aware of the success KPIs and understands the goal behind the MVP step, the team collaborates on the project more effectively.

One of the Wise clients developed an effective approach to MVP creation based on the target audience’s feedback. The team involved the predefined focus group in the evaluation process right from the start. Learn how we developed an <a href="https://wise-engineering.com/case-studies/core/" target="_blank">MVP for an all-in-one fitness chain platform</a> and learn how the team worked with the focus group’s feedback from the case study. Another our client was using the <a href="https://mixpanel.com/" target="_blank">Mixpanel</a> service very actively to see at what steps we lose a potential client and react iteratively on the UX improvements.

Thus, when you decide what defines your MVP success, collaborate with your tech team to include analytics services in your tech stack.

## Never underestimate communication

Communication might be the least expected aspect in the article about the tech stack for MVP, however, from our 15 years experience of launching MVPs for E-commerce, EdTech, Media & Entertainment, and other industries, effective communication contributes to the overall project success.

By effective communication, we mean both communication inside the engineering team, as well as communication between counterparts involved – founders, stakeholders, and investors. 

Inside the tech team, the decisions on the chosen tech stack should be well communicated and discussed across back-end, front-end, and DevOps parts. And as was stated above, the decisions should be documented. Besides, the people on the client-side should be also well aware of the tech choices. They might not need to be part of the technology evaluation process, but they should receive a summary of what tech stack was chosen and, most importantly, why, and what the alternatives are.

At Wise, we adopted the client-team approach to communication which helps our client reach out to anyone from the dedicated team. This helps to set an effective communication loop at the step of tech stack selection and ensure efficient collaboration when the MVP development iterations start. Read more about the <a href="https://wise-engineering.com/blog/post/new-communication-model-in-software-development-outsourcing/" target="_blank">new communication model in software development outsourcing</a> we apply to the collaboration with our client.

## Key takeaways

To architecture a tech stack that will benefit you MVP and allow you to make the most from this product development step, we recommend:

- Analyze both functional and quality system requirements.
- Define marketable user flow and plan MVP development roadmap based on it.
- Schedule DevOps consultation before starting the development.
- Consider project documentation as a long-term investment.
- Define MVP success metrics and set up the analytics right from the start.  

At Wise Engineering, we are fluent in different technologies across multiple domains. Check out the tech stacks we usually apply for [MVP development for startups](https://wise-engineering.com/expertise/mvp-development/) and contact us to get tech stack consultation and estimates for your project.

What aspects influence tech stack choices in startup MVP development? There is no one-fits-all approach, but there are best practices you can apply >>

Tech choices in startup MVP development

Learn what aspects influence technology choices in MVP development and build a tech stack for your unique MVP idea.

marketplace_development_main_image.svg

The core strategy of any multi-vendor marketplace is to become an online destination. The E-commerce boom started long before Covid-19 pandemics continues to fuel the competition today. To remain noticeable within their industry segments, companies need to understand what shifts took place recently and quickly adopt changes applicable to their businesses. 

We’ve come up with a list of 5 major approach transformations in marketplace development that should help you shape your E-commerce business strategy for the upcoming year.

## Needs-based vs brand marketplaces

The first and most powerful shift took place in the way customers and marketplace owners see the aim of commerce. Needs-based markets fail to satisfy the present demand. The main principles of convenience, ease, and relevance are no longer about having *everything for everyone in one place*. A positive buyer experience requires more than just a shopping destination. Thus, even mega or niche marketplaces can’t fulfill the consumer’s needs for the buyer (not the product) to be the center of merchants’ attention.

### Brand marketplaces surge

To stand out a marketplace should be more than just a transactional site. And that’s why brand marketplaces are on the rise. Now it’s all about *something for someone anywhere they need it*. And to inject life into commercial operations, marketplaces aim to build strong relationships and gain customer loyalty. That includes **personalization, growing communities, and providing customized service with online shopping**. Thus, the latter turns into a meaningful and united virtual experience. Particular products are targeted to particular customers and create a one-stop-shop.

Another reason for this tendency is that brands try to get rid of the risks of retailers and dealers ruining their brand equity. Thus, any customer at any point has one and only destination for a certain brand. And the popular option is to browse products online, find a physical store location, and *click and collect*, either offline or have it shipped anywhere. Seamlessly integrated buyer experience matters most. 

### What makes a brand marketplace

Brand marketplaces create not just buyer experiences, but membership experiences, and aim to turn into membership economies in the long run. Unbranded search in everything-for-everyone mega marketplaces is replaced with the brand building to provide greater value to the audience. 

To remain relevant in these volatile times, brand marketplaces need to:

- Invest in smart or unexpected collaborations to explore new customer territory and stretch the margins of brand identities. As opposed to outdated brand protectionism.
- Provide overlap between digital and physical brand presence to support multiple touchpoints and hybrid structures.
- Ensure technical maturity across markets to streamline the customer journey.

![Marketplace requirements shift](https://wise-site.fra1.digitaloceanspaces.com/marketplace_development_brand_marketplace_requirements_3030a09528.svg)

## Enterprise vs small businesses & localization

Another natural alteration relates to geographical location and its influence on commercial success. In the past, it was all about large enterprises merging (read – swallowing) smaller companies to dominate with the same products and services global-wide. In the post-Covid period when local communities get lots of support, localization is a win-win strategy. Especially for cross-border E-commerce.
 
Successful multi-vendor marketplace development in 2022 requires a powerful localized approach. The latter helps international brands gain more revenue in different geographical areas. What matters is speaking to the shoppers in their language in product descriptions and/or customer support. 

### Localization is not equal to text translation
 
The first distinctive localization feature is attention to cultural distinctions and preferences. To engage your local audiences, make the marketplace relevant to them. And it’s not just about translating the pages of websites or apps into other languages. Localization goes far beyond that. It includes offering payment options popular within the region, presenting prices in native currency, and adjusting imagery to the specific cultural, social, or religious features. <a href="https://www.thinkwithgoogle.com/intl/en-cee/consumer-insights/consumer-trends/cross-bording-shopping-strategies/" target="_blank">73% of consumers</a> are still unwilling to trade a localized website for a price 30% lower, as the International Online Shopping Survey shows.
 
Multi-vendor marketplaces can also benefit from local service bundling. Large platforms may offer local services to make them exclusive and preferable in certain areas.

### Large marketplaces empowering local businesses

One more localization approach is to apply the supply chain consolidation local-wise. You can either use only local suppliers and deny international ones or focus on particular domestic regions.

At the same time, large marketplaces have the power to help local businesses either to emerge or evolve. But this doesn’t mean swallowing or blending them. Effective marketplace development in terms of localization means creating bigger ecosystems where small businesses have their part to play. 

Collaborations of companies of different sizes unlock more value for all stakeholders. They boost the local economies via generating additional jobs directly or as side-effects. Large companies also benefit from better matches for different regions. They can get more from the same amount of effort. Yet, to apply this strategy successfully, you should consider the social environment and competition in the local market.

## Single-channel vs omnichannel strategy

The single-channel strategy may still work for companies with limited budgets or scopes. Yet, technology made it possible for consumers to shop across channels with no or little difference in buyer experience. Thus, marketplaces have to do their best to develop their presence in all possible channels. And that incorporates interactions between a brand, a customer, and a retailer.

The prevalence of the omnichannel strategy among multi-vendor marketplaces proves once again that it’s no longer about the product. The focus is shifted to the customers themselves. Brands create a faultless customer experience and leverage the customer data across all channels. 

After all, it’s worth the effort. Businesses with the omnichannel customer engagement strategy retain about <a href="https://cybra.com/10-omnichannel-retail-statistics-you-cant-avoid/" target="_blank">89% of their customers</a> compared to 33% for those with weak omnichannel customer engagement, as the Cybra research proves.

![Comparing single-channel and omnichannel strategies](https://wise-site.fra1.digitaloceanspaces.com/marketplace_development_single_channel_vs_omnichannel_c7250c2249.svg)

### Omnichannel strategy advantages

The benefits of the omnichannel strategy are rather explicit.

- **Better customer experience.** Consumers interact with the marketplace in preferable ways. Synchronized customer information helps provide a personalized customer experience with little or no chance for incorrect data or shipments.
- **Increase in sales and traffic.** Expanded and more agile sale strategies and value-added content drive revenue.
- **Boosted customer loyalty.** Increased customer satisfaction and high-quality content across all channels help retain customers.
- **Better data collection.** The marketplace gets valuable insights on how to generate content and what offers will work better both online and offline.

### Possible challenges

The benefits of this strategy also might generate some challenges, as they call for a lot of attention to detail and consolidated processes. A seamless shopping experience requires perfect knowledge of your audience to create the right strategies in the right channels. Thus, another issue is the selection of channels that matter to your audience and working on a solid strategy for each of them. 

Yet, the most fundamental factor is the cost and accuracy of the strategy for developing all channels in an integrated and interconnected manner. Consistency requires a lot of resources like time, knowledge, and maintenance. And that results in building teams, skills, content, and tools to manage these processes.

### Why switch from B2C to D2C

To ensure a compatible omnichannel policy, B2C marketplaces can’t afford not to have a powerful D2C strategy. This robust approach allows businesses to prevent their overreliance on brick-and-mortar or third-party retailers. Using D2C channels helped blend offline and online presence in a new *clicks and mortar* business model.

The retail disruption during the pandemic proved that proper D2C strategies also help maintain business continuity and satisfy the evolving demand for uninterrupted *no-middlemen* customer experience. The latter gives direct access to valuable customer feedback that can be used to drive sales. Total control over all aspects of customer experience helps build emotional relations and nurture customer loyalty. 

To build decent customer-facing D2C experiences, marketplaces need to optimize their back-office processes. In such straightforward re-designing of the commerce models, you need to focus on business core competencies. Yet, this challenge can be seen as a benefit for your improving business strategy as a whole. To succeed, learn to concentrate on doing what you're best at and what matters most.  Weigh your options and delegate other aspects that can take too much opportunity cost like [custom E-commerce development](https://wise-engineering.com/expertise/e-commerce/). 

## Local vs cross-border trade
The immense shift in consumer habits allowed E-commerce to go cross-border with virtually no geographical limitations. This surge doesn’t only apply to certain types of products or services. Consumers make cross-border purchases of everything – from everyday items to luxury. 

And this is not a short-term issue, rather an evolving tendency. Those who converted to online shopping during the pandemic are likely to stay after things go back to normal (well, the new normal). And the predictions are that the bigger part of it will be cross-border.

In a nutshell, despite all the benefits of this marketplace globalization, cross-border E-commerce has no one-size-fits solution. Different marketplaces have multiple options for different markets and regions. Such diversity ensures proper pricing, customer satisfaction, and retention. To stay relevant and profitable, cross-border E-commerce has to tackle several challenges.

### Cross-border banking

Multi-vendor marketplace consumers expect payment options that use local payment networks, their own banks, and new mobile methods. Yet, when a shopper makes a cross-border purchase, the transaction involves not just their bank but the merchant’s bank. It also includes a payment processor, card network, issuing bank, an acquiring bank. Whether the customers select the preferred payment type themselves or follow the merchants’ options, the FX margin may be quite different and, thus, increase the total purchase price. And that’s what your customers need to know in advance.

### Cross-border taxation

Brands selling cross-border need to follow local tax laws, import and export regulations. The outbreak of Covid-19 increased the number of countries that tax foreign exchange payments as well as the tax amount itself.

Failure to understand the nuances in local regulations could result in serious financial penalties and damage to brand reputation. If the consumers bear these additional costs (and they usually do), it’s not the bank, but the merchant who is responsible for all the clarification. Transparency is the only strategy to avoid misunderstanding as to why and what taxes they are charged.

### Price variation across countries

Marketplaces that involve cross-border E-commerce cannot and should not have the same price in different markets and regions. Pricing policy should be elastic locally and internationally. And elasticity is not only about the price but the value as well, both tangible and intangible. 

Price alteration comes in two options.

1. **Cosmetic changes** happen when the merchant only converts the price applying local currency. Earlier, we addressed the importance of localization for gaining trust. Shoppers expect to make a transaction in their local currency (by default or choosing it among other options) regardless of the product’s country of origin. Conversion can still be carried out in different ways. Sometimes it allows the merchant to grasp additional fees and not to let the card issuer benefit from it. 
2. **True price localization** is when the price differs across different markets, countries, and regions. In this case, price (and availability) for goods or services may vary globally or even across one country either due to governmental policies, currency exchange rates, taxes, tariffs, and insurance factors or market individuality like consumption composition, facilities, providers, competitors, brand preferences and local market needs.

In any case, the three major points are: to be transparent with the buyers, to stay within the internal pricing corridor for price differentiation, and to handle the price localization yourself.
 
Thus, to make the price relevant to actual market value, it is possible to use automated monitoring tools. They help keep track of products in different distribution channels, resellers and competitors, inside different countries and markets. Automated monitoring tools save the merchants time and money. And the data you receive prompts how to improve your branding strategy.

### Security issues

Multi-vendor marketplace development also requires reliable and seamless systems to support cross-border payments. Firstly, it’s vital to keep constant track of data protection regulations. These are specific to countries involved in E-commerce and tend to change the terms and compliance dates. Their violation may result in budget and brand reputation loss. 
 
The cross-border trade boom also means a greater number of online crimes. To make cross-border transactions safer and prevent cybercrime, leading payment providers started to introduce or, at least, consider utilizing biometrics and KYC identity verifications. To protect revenue streams and ensure customer security, online marketplaces may also need to involve these technologies. As well as international payment messaging standards like ISO 20022. At present, <a href="https://managedlei.com/blog/the-challenges-of-cross-border-payments/" target="_blank">70 countries</a> across the globe have adopted the latter, and more should join to provide interoperability and online purchasing security.

## Build vs buy in marketplace development

When it comes to marketplace creation, [custom E-commerce development](https://wise-engineering.com/expertise/e-commerce/) is always the choice. Yet it does not mean that all the functionality will be written from scratch. To launch faster, experienced tech teams opt for ready-made API-level solutions or parts of those to solve some trivial tasks and focus on those parts of the E-commerce platform that brings the most value to the end-users. 

It makes sense if marketplace development is seen not just as a platform creation but as shaping the engine that moves the E-commerce business forward. This option allows instead of reinventing the wheel and diving into troublesome and long-term development, to focus on what makes your business special and constitutes its core competencies. 

For example, if you run a cross-border marketplace, you would obviously need a custom solution for banking, payments, and taxes. At the same time, you can integrate a SaaS product for website analytics or email marketing. If your marketplace possesses a variety of products that are hard to categorize and the integration of the full-text [internal search](https://wise-engineering.com/expertise/elasticsearch-integration/) is the only way to help users find the necessary goods, this aspect would require the most effort of your development team.

![How to make a build vs buy decision](https://wise-site.fra1.digitaloceanspaces.com/marketplace_development_build_vs_buy_f08f74e319.svg)

## Key takeaways

Recent transformations in the global E-commerce industry create multiple opportunities for marketplace development. Here are the main handy takeaways you can start implementing. 

- In marketplace development, consider buying existing components, many of which have become commodities nowadays, and invest in building what makes your business core value.
- Focus on the brand of your marketplace. The strategy of selling everything to everyone is in the past. It’s all about personalization and customization now.
- Collaborate with small regional businesses to evolve together and create mutual benefits. Apply thorough localization strategies. The commercial success of your marketplace across the globe directly depends on how well you can relate to diverse local communities. 
- When exploring new horizons through cross-border trade, do not underestimate the risks related to banking, taxation, pricing, and security.
- Embrace your customer's attention through multiple channels. Make your brand omnipresent and integrated into offline and online shopping.



Get the list of 5 major approach transformations in marketplace development that should help you shape your E-commerce business strategy for 2022.


5 shifts defining marketplace development in 2022

Get the list of approach transformations in marketplace development that will help you shape your E-commerce strategy for 2022.

mvp_mindset_main.svg

Although it’s hard to find any business-related person in the tech industry who would have little or no idea of an MVP, there is still a lot of confusion about its real purpose. And the more widespread its usage gets, the more misconceptions appear. 

To build an MVP in the right way, it seems sensible to conduct thorough user research, involve every expert on the team, and make sure all the key results are outcome-based. These are great practices. Yet, their combination in MVP development only makes you spend too much time and budget on what should actually save your resources.

Based on our experience in <a href="https://wise-engineering.com/expertise/mvp-development/">MVP development</a> for 15+ years, we’ve assembled a list of mistakes online businesses trap into and key ideas that help set a relevant MVP mindset and cope with this product evolution step efficiently for your startup success.

## What MVP is NOT

At some point, at Wise Engineering, we started analyzing why businesses with great expertise still experience pitfalls during the MVP step. Cooperation with multiple startuppers and business owners helped us define four main faulty ideas you might want to consider before the MVP development starts. 

### Not any initial development step

Not every business chooses to start with an MVP. And not every initial product development version is an MVP. In some cases, startups opt for immediate product introduction to the market. For instance, when planning an E-commerce platform, one may skip the MVP web development phase and launch the whole marketplace at once. While it’s their decision to make and this option is applicable in some cases, it’s worth saying they are lucky to pull through. 

So that’s when an MVP term gets its major misinterpretation. Not every initial product development version IS an MVP. MVPs are not created to generate profit or get first users. Even if it happens, think of it as just a pleasant side-effect rather than a primary goal or a rule. MVPs are not meant to have emotional design or are created to impress users. 

![Product development process with the MVP development step](https://wise-site.fra1.digitaloceanspaces.com/mvp_mindset_product_development_process_2aa032041d.svg)

On the contrary, any MVP is a quick solution to narrow down your idea to the smallest version possible to test your assumptions. It has neither a product with an advanced tech stack nor broad functionality. Overall, an MVP is just the smallest, earliest, yet, verifiable option that registers the customer’s pain, proves the suitability of the solution you offer, and gives you proper feedback. The results are used either to pivot or to move on to the next stage of project modification.

### Not a minimum feature set

Despite its name, MVP is not about minimum product delivery. The definition of *minimum* depends on a particular project in a particular context to make this MVP meaningful. It’s about giving your users something, most often rough and far from your final version, to test. It’s about listening to their feedback and learning from it. Finally, it’s about iterating and driving new, updated (if not completely different from your initial idea) value to the end-users to get market traction. This is what we call validated learning that helps place the user’s needs and pains, not your app, in the center.

In a nutshell, *minimum* stands for solving early customers’ urgent problems from the very start by adding only those features first that matter most. So, instead of focusing on *M*, never underestimate *V* in your MVP. 

![Difference between an MVP and an end product](https://wise-site.fra1.digitaloceanspaces.com/mvp_mindset_difference_MVP_product_19225efe60.svg)

### Not a perfect product version
 
Addressing ALL potential users with ALL best possible functions on ALL devices and platforms is a dead-end road. Trying to turn your MVP into an “ideal first draft” ends up being stuck in its development forever. Not to mention the cost of such a search for excellence. 
 
MVP consulting we do regularly shows that for many startup owners it is painful to weed off the functionality they think would be nice to have. Sure, as product owners they are tempted to develop the very best of what they have in mind. Yet, in the case of <a href="https://wise-engineering.com/expertise/mvp-development/">MVP development for startups</a>, it is not a sensible strategy. What makes a difference is their flexibility and readiness to pivot at any point. 
 
Your MVP shouldn’t test certain features but the value it can add or a problem it can solve. Thus, the fewer features your MVP has that serve its primary purpose, the faster the feedback and the more time and money you save for future iterations. A product with broad functionality and dozens of tasks to test is no longer an MVP as it cannot be reliable in validating or invalidating your ideas and takes ages to deliver. After all, such a down-to-earth and thrifty MVP approach makes sense as no project has unlimited time and budget.
 
What we advise is to think of your product as the one that’s constantly improving. Many companies release products with lots of great features that are never used or updated. This is not how great apps are made. Yes, MVPs will never have everything you dream they should have. However, once you keep iterating, this is hardly a problem.

### Not an end product

In fact, an MVP doesn’t even need to be a product to make the best of it. The intentions behind MVP development are to test the idea, see if you can sell the product-to-be (the *fake-it till-you-make-it* approach), collect feedback and/or the potential users’ database, engage prospective investors and receive (or not) their approval and funds.

Yet, many teams view an MVP as a half-baked product or the one that can be released earlier than expected. Once the startup owners attempt to see an MVP as something they develop and consider the job done, that’s where they fail to bring their idea to life. 

To make an MVP beneficial, you have to treat it as a process that you must repeat constantly. Define your assumption, verify it, learn as much as you can and use the outcome to make data-driven decisions with as little time, effort, and money as possible. Repeat that loop. Do better. At every stage. And that’s the only helpful strategy. MVP development is more like building a part of every app development stage rather than producing one layer at a time.

![what is an mvp](https://wise-site.fra1.digitaloceanspaces.com/mvp_mindset_what_is_mvp_91f2734944.svg)

## MVP mistakes to avoid

Let’s discuss the most common mistakes a lot of startup owners stumble over, irrespective of the project type, scope, or industry.

### 1. Early tech advancement

It’s common knowledge that every startup is built to grow. Yet, thinking in advance might result in an overengineered MVP incapable of performing its primary task – test the idea with the minimum effort and resources (read: quickly). What you need is just to build the key functionality and not assemble a complicated and scalable tech stack from day one. The latter is neither practical nor cheap. 

If the tech stack is too simple, you will create a low-quality MVP not enough for initial users to test and give proper feedback. Yet, once you try to involve too much too soon, you might get stuck working months and spending extra just to find out the core idea, and eventually, will need another tech stack to implement it.

### 2. *I-know-best* approach

On your way, you will deal with vendors who provide MVP services. Our experience proves that whatever skills, brilliant ideas, or expertise an entrepreneur brings to the table, a project rarely succeeds if the focus is kept on the initial suggestions and any advice is rejected. 
 
If there is no collaboration, it results in a major risk of bringing that precious *so-good-in-theory* app into life just to find out it is something your actual users either can’t, don’t need, or don’t want to use. At least, initially. And that’s what MVPs are for. Reasonable assessment: to test, analyze and pivot when it isn’t too late. At this point, it’s crucial to stay open to the suggestions your MVP consulting team has. 

The I-know-best viewpoint is easily tested by a hard heart and a critical eye. The problem is, startup owners rarely have one for their cherished projects. That’s when MVP development services for startups come in handy. And even if you have a good development partner, it’s still difficult not to defend your initial idea or burn everything to the ground. What matters is to stay humble, listen, learn, adapt, and alter when suggested to do so.

### 3. Moving forward slowly

Startups have a major benefit: flexibility. They can pivot in a quicker and more stress-free manner than big market players. If you engage core functionality either in a small or a medium-scale project, it’s easier to adapt it or even start from the base one as soon as you get feedback from early users. 

Yet, competition plays an evil trick with startup businesses. Some of them still misuse the MVP benefits wanting to give their customers more. Overloading your MVP with irrelevant (at this point) functionality usually results in budget overruns, not meeting the initial targets, reworking modules that have no value to your users, and delays in the final version launch. 

The two common ways to see if you are making this mistake is to check how long it takes to deliver your MVP and its particular tasks. 

- The average period for a complete MVP is up to 3 months. 
- The number of key items on your list to validate is 3.
- The workload for an average task varies between 2 and 4 days.

These numbers are approximate. Yet, if you passed these marks, you are probably adding too much or even jumped over to developing the full product instead of an MVP. 

## MVP mindset components

To achieve commercial success with your startup and make your MVP work for the benefit of the final product, you need to think, plan and act in a fast, yet reasonable way. We collected a few tips that are always crucial to the smooth MVP development.

### Clear product vision

<a href="https://www.cbinsights.com/research/startup-failure-reasons-top/" target="_blank">CBInsights</a> states that the startup owner’s inability to identify the market demand is the reason behind 35% of startups’ failure. To see if your MVP resolves the pain points and minimize the risk of going in the wrong direction, you need to:

- Define very specific assumptions to be tested
- Set accurate MVP goals
- Focus on the problems to solve

The more clearly you identify the product and its long-term prospects, the more accurately the development team implements it. The way you test it must be straightforward and simple so that you and your customers could easily check if it has any value. To make sure you are addressing the right problems, conduct research, map out user stories or cases. You can focus on a certain group, and not target a broad audience if it isn’t necessary. This helps you steer away from an over-engineered MVP, stick to the core idea and functionality, get rid of the tasks that don’t need to be validated at the initial stage, and make the MVP development process worthwhile.

Check out this case study on <a href="https://wise-engineering.com/case-studies/podnods/">web application development</a>. It illustrates how precise requirements from the client helped us to deliver the app earlier than planned.

### MVP success metrics

To understand the product prospects, it’s important to rely on effective and proven ways to measure the success of your MVP. This validation process includes two major types of metrics you can involve: 

- Via qualitative metrics (rich text) you can get direct customer feedback through surveys, polls, and interviews, and use them to evaluate the user experience of the MVP. 
- With quantitative (numerical) metrics you can assess if your MVP solves the problem and is easy to use, check the level of engagement, and analyze if your marketing strategy needs changes. These metrics include download and launch rate, in-store positioning and user rating, customer acquisition cost (CAC), average revenue per user (ARPU), percentage of active users and paying users, customer lifetime value (CLV), churn rate, and more.

Whatever combination of indicators you and your tech partner choose to apply, do it before the development stage. These metrics help define the scope of work for MVP development services. What you measure in your MVP should be relevant to how you make progress with your startup.

The choice of the metrics also depends on the target audience of your MVP. If it is a focus group, select the relevant target audience. A group that includes the wrong number or the wrong type of users provides misleading results even if the metrics are accurate enough. If you are aiming at a broad audience, include the marketing costs into your budget to make sure the users are aware of its existence. Finally, if you need an MVP to prove the validity of the idea to your investors, you may need to include either of the previous audiences. The latter option serves as the showcase of how people can use it and demonstrate what you have next in mind. 
 
In a recent <a href="https://wise-engineering.com/case-studies/blue-collar-lists/">cross-platform mobile app development</a> project, we created an interactive dashboard to help our client access the key data on mobile app performance in a convenient format and accumulate it in one place. All to help a startup company rely on data in their business decisions.

### Minimal marketable user flow

At this point what you need is to invest in core functionality and processes to provide more value now and in the long run. To identify such must-haves, analyze and minimize user flows you may have in the course of the startup development. The more minimal the user flow is and the fewer points you test, the easier it is to analyze the feedback and make the best of your MVP. 

To generate such reduced or minimal marketable user flows (MMUFs):

1. Create user personas and prioritize them to get the smallest (yet, viable) number you should work with using MVP techniques.
2. Create use cases and arrange them in user stories to focus on UX rather than a collection of features to build.
3. Prioritize use cases and break down user flows for each of them.

Such MMUFs can help you and your tech partner understand user behavior and dynamics, application logic, third-party integrations, and back-end tasks to fulfill later with less effort and resources involved.

After creating several MMUFs, crucial at the initial stage, you can move on to generating wireframes around each of these user flows in your MVP. This helps perform usability testing in a controlled research environment to record all the feedback.

One more advantage to this MMUF-based approach is the opportunity to track how every little alteration you apply influences or changes your users’ behavior. The latter is highly unlikely once you test two or more features at a time. Simplicity and transparency are key principles in verifying such user flows: minimum steps for users to take and UX design minimalistic enough not to overpower but to highlight what matters.

![Minimal marketable user flow](https://wise-site.fra1.digitaloceanspaces.com/mvp_mindset_minimum_marketable_user_flow_svg_f1bfe67225.svg)

When we helped with the <a href="https://wise-engineering.com/case-studies/core/">MVP app development</a> of the fitness chain platform, we applied the MMUFs approach, tested prototypes in focus groups, and adjusted the product based on the feedback. This helped our client launch a product beta with a really handy feature set. 

## What to expect from a tech partner

It’s quite a challenge to select a proper outsourcing development team for MVP engineering as it has lots of intricate aspects to take into consideration. These are the main requirements you should pay attention to while choosing an outsourcing team and starting your cooperation.

**Relevant tech stack**

Think big, start small. The tools and features your tech partner suggests should be good enough to solve the current issues and not overdo the tasks an MVP is to address. There is no need to focus on complex infrastructure or overload your MVP with features that are not essential at this step of idea validation. 

**Focus on minimum marketable user flow**

A tech partner who really gets the idea of an MVP makes sure all the members of the team and the startup owner understand the necessity to start with an MMUF. The latter is helpful in defining certain opportunities or possible bottlenecks, yet, not so time and effort consuming. 

**Basic security and system load settings**

Even if your MVP is tested by a minor focus group, safety comes first. Your users’ personal data, the code generated for the MVP creation as well as the initial idea are too valuable to risk them. At the same time, if you aim at a broad audience, your development team will point out the necessity of system load settings. The aim is to ensure smooth operation and no technical details getting in the way of proper feedback.

**Flexibility and adjusting on the go**

A flexible development team will not write tons of documentation for every button you may need. It will rather split the whole scope into epics and pivot, adjusting when it’s most appropriate or required. By arranging your MVP development into small iterations you can stay alert and be ready to adapt quickly. Flexibility helps the team reach high-level goals with an altered vision that relies on users’ feedback and new suggestions. 

**Clear roadmap and specific timelines**

Although MVPs are about flexibility, it’s essential to have a plan. Your development team should provide you with a detailed schedule of what, when, and how all the steps will be implemented. Starting from the very beginning and up to the post-launch activities. A roadmap and timelines help every person involved understand what milestones are ahead and stay up-to-date. As a product owner, you can use such data to make data-driven decisions for future iterations.

## Key takeaways

To embrace a true MVP mindset, make it a rule to dream big and apply an iterative approach to its planning, launching, and testing. Your MVP can’t and shouldn't be ideal. It’s neither an initial product development step nor a perfect end-version. It isn’t supposed to have the most modern tech stack or a maximum collection of features. What it needs is flexibility, precise goals, a clear roadmap, and well-defined problems your product solves. No matter how great or easy this idea might sound, its proper execution is what requires the most effort and true MVP thinking. 

An expert opinion on <a href="https://wise-engineering.com/expertise/mvp-development/">MVP development</a> can add real value and take the MVP of your new product to a new level. Contact us to discuss your business idea, and let’s find the quickest way to validate it. 


Based on our experience in MVP development, we’ve assembled a list of mistakes online businesses trap into and key ideas that help set a relevant MVP mindset. 

How to develop a true MVP mindset | Wise Engineering Blog

Check out the list of mistakes online businesses trap into and key ideas to set a relevant MVP mindset.

How to develop a true MVP mindset

sales (1).png

The <a href="https://www.retailresearch.org/online-retail.html" target="_blank">center for Retail Research</a> published a report which suggests that e-commerce is the fastest-growing retail market in Europe. With the Coronavirus pandemic keeping millions of local businesses in lockdown, the global E-commerce market is undoubtedly going to <a href="https://www.statista.com/study/42335/ecommerce-report/" target="_blank">surpass 2 trillion dollars</a> by the end of 2020.

Many successful and aspiring entrepreneurs regard E-commerce as one of the most accelerated and efficient systems for reaching successful outcomes online. And to become a successful E-commerce enterprise, business owners will need to do a lot more than just identifying a product niche, set up a website, or advertising to potential customers.   Therefore,   they will need to improve their search in e-commerce to provide   "almost perfect"   search queries for potential customers looking for a specific need.

With regards to a recent E-commerce search experience report by The Baymard Institute, you'd be surprised by the outcome. Out of the 50-e-commerce website evaluated, 34 percent of search queries on their website don't usually reveal useful results, and 70 percent of those search engines on those websites do not show relevant product similarities.

![Search Query Support Among Top 50 US E-Commerce Sites (1).png](https://wise-site.fra1.digitaloceanspaces.com/Search_query_support_among_top_50_US_E_commerce_sites_72b947df27.svg)

Whether you manage a small online store or a big E-commerce website, ensuring your e-commerce site search is consistently enhanced to provide frictionless user experience is vital for higher conversion.

All E-commerce website visitors are unique. Some visitors already know what they want to buy, while others look for entertainment - surfing through the latest trends, product images,  description,  or checking out the information.   Nonetheless,   no matter the site visitors, whether browsers or researchers, you can use them to your advantage with your federated search information.

It's important to know that every element on an E-commerce site has a role to play for the success of the site, the same way different shoppers rely on various aspects on the site to shape their user experience. Extensively, online customers can be separated into two transcendent sorts: researchers and browsers.

Researchers are goal-driven shoppers to purchase soon. They already have the idea of what they want but will probably be searching for the most suited option from their search in E-commerce sites.

Researchers may surf through your website multiple times, gathering information before they decide to make a purchase.

On the other hand, browsing shoppers visit an E-commerce site to see what is new, famous, and what's on sale.

They go to their favorite website or a new section to stay up on the latest trends, window-shop for future purchases, or to kill time. Whatever the case may be, having people spend time on your site can be intuitive for your brand. If they are the excellent user experience your site has to offer, they'll be more likely to revisit your site when they are ready to make a   purchase.   While they are busy getting entertained,   you,   the business owner has the opportunity to gather valuable information about your visitor, which can help you turn those browsers into buyers.

Another intense research from the Baymard Institute suggests that E-commerce site search is undoubtedly found to be the preferred product finding strategy by shoppers as they perceive it to be faster than category navigation. In this regard, Effective site search plays a direct, quantifiable role in increasing sales revenue, so working towards improving and optimizing your product inventory will directly affect the success of your search in e-commerce.

When on-site search is compared to other metrics, site search is usually ignored. Business owners prefer to pay attention to optimizing personalized emails or landing pages. In contrast, almost all product-focused buyers use on-site search to hasten their buying journey on an E-commerce website.   And if your website happens to lack the efficiency and accuracy they want, they will look elsewhere.

Your on-site search plays the role of your sales team. Nonetheless, taking the necessary steps to improve your site search can lead to happier customers who eventually convert to real paying clients.

There are three primary ways shoppers can find products on an E-commerce site.

![Jeans_.png](https://wise-site.fra1.digitaloceanspaces.com/Jeans_5cdcfc2aa2.png)

- Category   Browsing:   occurs when shoppers surf through categories and narrow down to see the items they are searching for in the subcategories.
- Keyword Search: happens when a potential shopper uses the on-site search bar to find products using closely related keywords. The keywords can be short tail or long-tail keywords; internal, competitive, and industry-specific.
- Faceted Search occurs when shoppers refine their search by narrowing the results through search filters. For instance, it can be filtered into length, size, brand, or weight; this type of search filters can be searched on the Amazon website. It will be an excellent opportunity to integrate a solution that will help achieve your search goal - such as enterprise search, or database search engine into your faceted Search to produce more search relevant information to your site visitors.

Several factors contribute to whether shoppers can easily find products through on-site search. These factors make it easier to provide the nearest search queries to visitors, which include synonyms, predictive search, misspellings, and type-ahead. Big websites like Amazon have integrated enterprise search as a service software to ensure their on-site search is performing efficiently.

For instance, Amazon tries to find relevant, accessible, and informative content to provide to its customers. The website uses a sophisticated search algorithm that has one primary objective; bring shoppers closer to relevant products as fast as possible. Basically, the Amazon search algorithm works similarly to google search algorithm. It analyses merely search queries for relevant keywords and matches customers' needs with related products in that niche.

Aside from providing engaging value to its customers, Amazon has access to a considerable amount of data to use for search engine results. This benefit is linked to the fact that Amazon is a self-contained platform, gathering data from many sources and storing them within its big data infrastructures.

Amazon uses the A9 ranking algorithm, whose primary purpose is to deliver a spectacular customer experience, thereby leaving the customer hooked on the website. It achieves this by analyzing different pieces of information to determine the most accurate and valuable product to appear in the search queries. The algorithm usually considers the following criteria to rank the product according to search relevance. They include: keywords, customer reviews, performance history, delivery time, and, most importantly, sales conversion.

## Conclusion

Whether you are a small or big E-commerce website, the importance of search in E-commerce cannot be overemphasized. Search is relevant and improving search leads to better conversions and engaging shopper experience.


Learn how optimized internal search leads to better conversions and improves overall user experience.

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Dedicated software development team. Best practices to hire

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From idea to MVP for mobile app

MVP development for a marketplace platform

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development insights from
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