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Do you have clarity on how users perceive your product? As designers or developers, we face this question at some point, whether implementing new functionality or iterating on an existing product. However, we know that tight deadlines and limited resources can make user research seem like a difficult challenge to tackle because of the time and investment involved.

To answer this question, at Nareia we have designed an agile approach we call Minimum Viable Research (MVR). This method allows us to obtain valuable insights, validate the product quickly and efficiently, without compromising deadlines or inflating costs.

In this article we share with you what MVR consists of and how we carry it out in our client projects.

What does an MVR involve?

This is a small research stage with users that does not compromise the roadmap or the resources available for the project, but it does serve to validate hypotheses and make new discoveries.

The research phase gives design projects exceptional value. It is a research tool where the true potential of the product is discovered, the impact it will have on users, the market opportunities that exist and mitigates the risk of building something that users do not want to use, in short, it is a key piece to make the right decisions and innovate.

We know that this phase of research is often perceived as costly and that many times it is not clear what to do with the results obtained. At Nareia our intention is to try to change that perception by carrying out a minimum viable research that focuses on obtaining the most relevant insights quickly and efficiently, ensuring that design and development decisions are based on the real needs and expectations of users.

MVR requires design time spent on research, allowing us to optimize when making design decisions. Instead of working on assumptions that could lead us to explore multiple options that are irrelevant to the user and cause us to develop a product that needs to be corrected once it is on the market, we design and develop based on research findings, ensuring that our work is more efficient and focused on what really matters.

How do we do it?

Our Minimum Viable Research (MVR) approach combines agility, creativity and experience to obtain actionable insights without compromising timelines or budget.

1. Agile planning

Before we started, we sat down to define a simple and straightforward plan. We identified:

• The main objectives of the project.
• The key questions we want to answer.
• The tools or methods we’ll use to gather quick insights.

This step ensures that every minute spent is aligned with business priorities.

2. Defining the problem

Rather than jumping straight to solutions, we focus on understanding the “why” behind each challenge. We validate our hypotheses with the business to ensure we investigate what really matters.

3. Identifying the target audience

We make sure we know the users who represent the market and we make sure we are spending time studying this audience and not wasting time gathering information on profiles of people who are not relevant to the product.

4. Fast and effective methods

Depending on the needs of the business, we apply specific tactics that require little time and resources:

• Social media and online reviews: We explore what the users (and your competitors’ users) are saying about the product.
• Metrics and prior studies: If the product already has metrics or previous studies, we incorporate them into the research to avoid starting from scratch.
• Guerrilla research: We engage with the users in their usual environments to observe and ask questions.
• Customer support insights: We analyze frequent inquiries and complaints to identify key areas for improvement.
• Recruitment allies: We collaborate with the client’s team members who interact with customers to facilitate user interviews.

5. Continuous feedback and iteration

We integrate strategic points in the design where users can give us feedback, either through forms or in-app feedback.

This continuous cycle ensures that design evolves based on real data.

6. Developing metrics

To understand how users interact with the final product,  we can establish measurement points within the experience to evaluate the different paths users take within the experience. These points are selected based on their relevance to the business and the hypotheses defined during the research.

In this way, we can identify which aspects are working correctly and which ones need improvement, allowing us to iterate and adjust the design according to the results obtained.

7. Unlimited adaptability

We know that not everything always goes as planned, so we are flexible. If a method is not viable, we find creative alternatives to continue obtaining relevant insights.

Additionally, not all steps are necessary for every process, some can be swapped or replaced depending on your needs, budget, and objectives.

What results will you get from driving an MVR?

Minimum Viable Research is not only about fast research, but also about obtaining practical and above all actionable information that drives product success. Through this approach we help the business to achieve concrete results such as:

1. Identification of key needs and problems users face with the product.
2. Early validation of hypotheses. It allows us to know if the users understand and value the product proposal.
3. Concrete design recommendations. The data collected is transformed into clear and practical suggestions for both the UX/UI and development teams.
4. Prioritization of improvements with impact. This ensures that resources are optimized by focusing on what really matters.
5. Risk reduction before launch. Avoid Costs associated with redesigns or corrections after release to production and reduce negative reviews.
6. Insights for future decisions. Research generates lasting learnings about users and their behaviors that can be applied in future iterations of the product.

Time and resources

While every project is unique, our experience has shown that we can achieve reliable results and actionable outcomes with the following investment:

• Two designers
• 20 hours per designer
• 5 to 6 user interviews

This means that within a one-week period, it’s possible to conduct research that doesn’t compromise the roadmap while ensuring efforts and resources are focused on adding value to the product.

Here is a use case

With one of the clients with whom we performed a MVR, we executed a usability test for a week in order to change the design of the main screen of the application, the home screen.

This redesign involved a big risk because we went from a very simple home screen with only one information, to a more complex home screen where we included access to different services of the product and a big change in the navigation to access the information.

The effort made was of: 

• 1 designer 
• 19 hours
• 6 usability tests with users

During this MVR we were able to prove that most of the changes had been positive but we needed to adjust some affordances, such as horizontal navigation for users to discover some of the content that had been hidden. We also discovered other deeper problems that affected the brand identity of the product.

In a nutshell

MVR aims to conduct fast and effective research, using only the necessary resources to avoid affecting project timelines while adding value to the final product.

Its main strength lies in its flexibility, as it can be applied during discovery phases to identify user problems and needs, or in validation stages before development to confirm whether a proposed solution meets user expectations.

By prioritizing key hypotheses, simplifying processes, and fostering feedback cycles, MVR enables informed decision-making, ensuring that the design aligns with users’ real needs without compromising project timelines.

At Nareia we find it important to include research stages even in projects with a tight budget. Thanks to the insights we discover during the research we help us to streamline the design and development process focusing on investing in what the user really needs and gives greater value to the business.

Building a digital product can be an incredibly rewarding journey, but without the right strategy and planning, it’s easy to fall into traps that waste time and money. As CPO in Nareia Software, I’ve seen the same mistakes crop up again and again. In this guide, I want to share how to avoid those pitfalls and help you question your path to build a product.

Know your “Why” and define the problem

Many clients come in with a great idea, but they don’t always have a clear sense of why the product is necessary. Defining the problem you’re solving is fundamental. Ask yourself: what pain point does this product address? Who is it for? Without a strong foundation, it’s easy to lose your way during development. 

• Common mistake: jumping in with an idea because it sounds exciting, without validating it first.
• Tip: do some early market research, test the interest of potential users with small (and often cheap) experiments. Define a clear problem statement that will guide your journey from start to finish.

The importance of an MVP: Start small, stay focused

The idea of a Minimum Viable Product (MVP) isn’t just a hackneyed approach, it’s the foundation of smart product development. An MVP helps you validate your product idea in the quickest, simplest way possible, giving you insight into its value from a user’s perspective. The goal isn’t to launch with every feature, it’s to identify and deliver the core functionality that solves a real user problem and provides meaningful feedback.
The challenge of creating an effective MVP it’s about finding that sweet spot: offering just enough for users to grasp the value, without overcomplicating this or missing the opportunity for early learning. 

• Common mistake: trying to launch a “complete product” instead of focusing on the bare minimum, often out of fear that users won’t be impressed by a simpler version. 
• Tip: define the smallest version of your product that still delivers value. Be critical about every feature, if it doesn’t directly support the core value, or helps you validate the idea, save it for later.

Understand the real value of your product 

A successful product isn’t just about features, it’s about delivering benefits that improve user’s lives. You need to deeply understand what unique value your product delivers. Ask yourself: what do users actually gain from this? How does it solve a problem or make life easier?

• Common mistake: misjudging value by focusing on what you think is important rather than what the user finds valuable. 
• Tip: talk to potential users, build prototypes in simple tools, and iterate on your MVP based on their feedback. The best features are often discovered from users' insights rather than assumptions.

Technology dictating the product 

Technology should be the means to solve a problem, not the definition of the product itself. Too often I see clients who get caught up in a particular tech trend, and the entire focus shifts toward using that technology rather than solving the core problem.
For example, when AI becomes the central theme, instead of first defining the user’s problem and how the product should solve it, the technology itself starts dictating the direction. AI is a powerful tool, but it’s just that, a tool. It should enhance the solution, not overshadow the value you are trying to deliver. 

• Common mistake: letting technology drive product decisions, rather than focusing on the problem and the users. 
• Tip: Start by thoroughly understanding the problems and needs of your users. Then select or develop technology that effectively addresses those needs. Even if you have access to innovative tech, it should enhance your solution rather than dictate it. Always ensure that technology serves the solution, not the other way around.

Budget control: when bigger isn’t always better

Having a big budget might seem like an advantage, but it doesn’t guarantee success. In fact, it can lead to overconfidence, encouraging you to add unnecessary features or delay important decisions.
A smaller budget can actually work for your advantage, forcing you to stay focused, and make resourceful choices.

• Common mistake: thinking that you need a lot of money to validate a good idea. Believing that more money will automatically speed up development or lead to success.
• Tip: Set a budget that allows focused development but forces prioritization of the most critical features. Build an MVP cost-effectively, with an emphasis on learning and validation before making any big investments. 

Also, think carefully about when you spend money. Don’t allocate your entire budget upfront. Instead, use just enough to validate your MVP and confirm that your product is viable before committing to the next phases of development

Team composition: get the right talent involved

To build a successful product, you need the right team. Clients sometimes overlook the need for specific roles, like product manager or UX designers, assuming developers are the most essential roles you need to build a digital product. 

• Common mistake: overburdening developers with tasks and responsibilities outside their expertise, covering the role of product manager because you think you know your product best.
• Tip: build a diverse team from the start, designers, product managers, developers, QA testers. Product strategists are particularly crucial on the MVP stage, definition is everything while you try to validate your idea. To build that validated idea you can arm up with a great tech team, but on its own time

Conclusion

Creating a digital product isn’t just about the money, the tech or the team, it’s about having a clear strategy, managing risks intelligently, and being adaptable. By understanding the common pitfalls and focusing on building  an adjusted MVP that delivers real value, you can create a product that resonates with users and makes smart use of your resources. Start small, validate every step, and stay flexible, that’s the key to avoiding pitfalls when your are building digital products. 

The evolution of software monetization has been dramatic and transformative, beginning notably in the early 2000s as companies like Salesforce pioneered the subscription-based model, disrupting traditional one-time sales. A significant milestone was Adobe’s pivotal switch to the Creative Cloud in 2012, which shifted the entire software industry’s approach to value and service delivery. Today, mastering the monetization of digital products requires not only a keen understanding of your audience but also an in-depth strategic insight into your product and its trajectory.

This article will unpack how a thorough knowledge of your product’s capabilities, aligned with the foresight of upcoming trends, can help your monetization strategies, ensuring that your digital offerings not only meet market demands today but also adapt in the future.

Profound product understanding and visionary planning

Effective monetization is deeply anchored in understanding your product’s core functions and potential for evolution. Strategic planning is essential to address current consumer behaviors, foresee future technological shifts, and adapt to market needs. This dual focus on current functionality and future potential is crucial in the dynamic market landscape. We will explore the most prevalent monetization models and their strategic importance:

Subscription Models

‍Subscription models involve users paying a recurring fee for continuous access to a product or service. Exemplified by Adobe’s Creative Cloud, this approach provides ongoing software updates and cloud services, ideal for products that are integral to ongoing processes such as digital design tools or business software. Other major content platforms like Netflix and Spotify also successfully use this model, offering a steady stream of new content to keep their audiences engaged. The benefits include a predictable revenue stream and enhanced customer relationships, fostering regular product updates and customer support. However, challenges may include the need for continuous value delivery to justify costs, the potential for high customer churn, and difficulties in acquiring new subscribers due to commitment fears.

In-App Purchases

‍This model allows users to buy additional features, content, or services within an app. It’s highly effective for mobile games like Fortnite, where players can purchase skins, emotes, and season passes. The advantages of in-app purchases include flexible spending options for users and the ability to convert a fraction of a large volume of casual users into paying ones. However, disadvantages include potential user frustration from essential features being paywalled, the complexity of managing microtransactions, and the risk of alienating users who feel nickel-and-dimed.

Ad-Based Models

‍Ad-based models generate revenue by displaying advertisements, suitable for platforms with high user traffic like Google and Facebook, and applications like Spotify that complement a free tier with ads. The benefits include the ability to monetize non-paying users and provide a free or lower-cost service that attracts a broader audience. Drawbacks include potential degradation of user experience if ads are not well integrated, dependency on large traffic volumes, and “ad blindness”, where ads become less effective over time.

Freemium Models

‍Freemium models offer basic services for free while charging for advanced features. LinkedIn, for example, provides essential professional networking for free but charges for premium features. The advantages include a low barrier to entry which attracts a large user base and the potential for significant profits from a small percentage of users upgrading. However, challenges involve low conversion rates, the difficulty of balancing free and paid features to motivate upgrades, and persuading users of the value of premium services.

YouTube’s Mixed Monetization Models

‍YouTube combines ad-based and freemium models to cover a diverse user preferences and enhance overall user engagement. At its core, YouTube uses an ad-based revenue model, displaying ads before, during, and alongside videos, benefiting both the platform and its content creators through an ad revenue-sharing model. The advantages of this model include monetizing content at no direct cost to most users, thereby attracting a massive global audience. However, the drawbacks include potential viewer frustration with ads, which can interrupt the viewing experience and lead to ad-blocking behaviors. To address the drawbacks of the ad-based model and add an additional revenue stream, YouTube offers YouTube Premium, a subscription service that enhances the viewer experience. However, the challenges include convincing users to pay for a service they are used to receiving for free, especially in big markets where ad tolerance is high, like India.

Strategic Monetization Challenges, Trends, and Market Adaptation

‍Navigating the intricacies of monetization requires a balanced approach, particularly when managing the transition from free to paid features in freemium models. Setting clear user expectations from the outset and maintaining transparency about what each service tier offers are crucial for managing these expectations and ensuring a smooth transition to paid formats. As market conditions evolve, monetization strategies must also adapt to stay competitive and relevant. The rise of personalized pricing and usage-based models highlights a shift towards more customized user experiences, offering flexibility that can alleviate subscription fatigue. These models provide users with tailored options that closely match their usage patterns. Furthermore, anticipating market saturation and strategically adapting to these conditions is vital for sustained success. An example of such adaptation is Netflix’s introduction of mobile-only subscriptions in high-density, mobile-first regions like India, which cater specifically to local preferences and economic conditions, allowing users to enjoy streaming on mobile devices at a lower price point.

Even well-established companies can misjudge their monetization strategies. Here are some examples where monetization attempts either failed or faced significant backlash, highlighting the importance of understanding customer preferences and market conditions:

Electronic Arts (EA) — Star Wars: Battlefront II

‍In 2017, EA faced a massive backlash over its handling of in-app purchases and the loot box system in “Star Wars: Battlefront II.” The game initially required players to spend a large amount of time or real money to unlock major characters like Darth Vader and Luke Skywalker. The public reaction was overwhelmingly negative, with accusations that the game promoted a “pay-to-win” model. The backlash was so severe that EA temporarily removed all microtransactions from the game just before its official release.

Microsoft — Xbox One Initial Launch

‍When Microsoft first announced the Xbox One in 2013, it included plans for strict digital rights management (DRM) that would have required online check-ins every 24 hours and restricted the resale or sharing of used games. The gaming community responded negatively, feeling that the policies were anti-consumer. Microsoft eventually reversed these policies to align more closely with consumer expectations and the practices of its competitors, like Sony’s PlayStation

Snapchat — Redesigned Interface

‍In 2018, Snapchat rolled out a significant redesign that not only altered the user interface but also aimed to increase monetization opportunities by mixing ad-supported content with friends’ posts. The redesign was met with confusion and dissatisfaction from users, leading to a decline in user engagement and a significant backlash that included a petition with over 1.2 million signatures asking for the old design back. The negative response contributed to a substantial drop in Snap Inc.’s stock price at the time.

Netflix — Qwikster

‍In 2011, Netflix announced it would separate its DVD rental service and streaming service into two different websites, with the DVD rental service rebranded as Qwikster. This decision would have required users to manage two separate accounts and subscriptions if they wanted to continue using both services. After widespread customer dissatisfaction and a significant loss of subscribers, Netflix quickly scrapped the Qwikster concept and kept both services integrated under one platform.

Boomerang by Instagram

‍Instagram introduced Boomerang as a standalone app to create short, looping videos. Despite the popularity of the format within Instagram, the standalone app never gained significant traction. The failure was largely due to users not seeing enough value in downloading a separate app for a feature that was a simple extension of existing Instagram capabilities. Eventually, Instagram integrated Boomerang directly into its main app’s stories feature.

Actionable tips and best practices

Understand Your Audience Deeply: Before you implement any monetization
strategy, it’s crucial to have a deep understanding of your target audience. Conduct
market research and behavioral analysis to understand their needs, preferences, and pain points. Tailoring your product and its monetization model to fit these insights can dramatically increase your chances of success.

Create Value Before Monetizing: Ensure that your product offers substantial value before you ask users to pay. This builds trust and demonstrates the quality of your product. For freemium models, make sure the free version of your product is useful but leaves room for upgrading to more advanced features.

Transparent Communication: Be clear and transparent about what each pricing tier or model offers and how it benefits the user. Avoid hidden fees or overly complicated pricing structures that can alienate users.

Monitor and Adapt to Regulatory Changes: Compliance with local laws and regulations is crucial, particularly for businesses operating across multiple regions. This not only prevents legal complications but also helps in building and maintaining trust with users. A pertinent example involves Spotify in Uruguay. The company faced a significant regulatory challenge when a new bill was introduced, mandating fair compensation for artists. This legislative change prompted Spotify to seriously consider — and subsequently communicate to their users — the potential discontinuation of their services in Uruguay.

Diversify Revenue Streams: Don’t rely solely on one type of monetization strategy. Consider mixing several models, like YouTube and Spotify do, to maximize revenue potential across different user segments.

Focus on User Retention: Acquiring a new customer is often more expensive than retaining an existing one. Implement strategies to keep your existing users engaged and satisfied, such as loyalty programs, regular updates, and responsive customer support.

Educational Marketing: Especially for complex products, use educational content to help potential customers understand the value of your product. Tutorials and detailed guides can help demystify your product and encourage conversions.

Implement Localization Strategies: When your digital product reaches a global audience, it’s essential to localize not just the language but also the monetization strategies to fit cultural preferences, purchasing power, and payment methods.

Conclusion

The case studies demonstrate the pitfalls of poorly chosen monetization strategies. User frustration often stems from models that clash with their expectations. These missteps highlight the importance of aligning your monetization model with both your product’s value proposition and user needs.

At Nareia we’ve had to dive these waters in order to support clients with very different realities. In a nutshell, there’s no one-size-fits-all solution. Subscription models excel for products that provide ongoing value, while in-app purchases are well-suited for games with engaged user bases willing to pay for extra features. Freemium models can attract a large audience but require a delicate balance between free and paid offerings. Ad-based models benefit from broad reach but necessitate non-intrusive ad integration. Regardless of the model chosen, focus first on user value. Offer a compelling product with clear benefits before asking users to pay. Build trust by demonstrating your product’s worth, and remember that user experience should never be deliberately sacrificed for revenue generation.

By conducting thorough market research and understanding your target audience, you can craft a monetization strategy that complements your product’s value proposition. Stay agile, monitor user behavior, and adapt your approach as needed. Remember, sustainable success lies in creating a win-win scenario where your business achieves its revenue targets by delivering exceptional value to your users.