The MVP Process

Over 10 months, we iterated on our service using a lean methodology to test scale, retention, and value.

We began by building a landing page prototype describing our idea to generate leads. In this prototype, we tested the theory with what turned out to be a “too-good-to-be-true” model – 50% off Pampers Swaddlers diapers, one of the leading brands available at Walmart. Although securing wholesale orders of this brand turned out to be unrealistic, we learned that our customer segment will accept our premise and even self-organize around our proposition that pooling purchasing power is a viable way to save money on essentials. After attracting 50 members with regionally targeted Meta ads (and a dubious looking landing page), we observed a 10:1 rate of growth after our initial delivery. Members who bought the diapers evangelized for the service in regional mom-specific Facebook groups, growing our member list to over 500 in a matter of days.

After hiring a procurement specialist to explore our wholesale options, learning about international shipping processes, and extensive business modeling, we determined that the margins on diapers are very tight. Breaking even with this product alone would require a 70% retention rate over the course of 6 monthly purchases. To remain competitive with services like Walmart and Amazon, we designed a model with free delivery to regions in the GTHA, anchored by a central distribution centre.

A subscription model seemed the only viable route; we put together a shopify store and began monthly deliveries around Toronto to our initial group of subscribers. In this phase, we repackaged grocery store brand diapers that fit our criteria of quality based on customer interviews. In the meantime, we tested a range of product samples in collaboration with early adopters in order to determine which available product would be best suited for our market.

After 5 purchases, we determined a 38% retention rate and average Customer Lifetime Value of over $50. This was consistent with what we were learning about diapers; that they are a low-loyalty product. Through conversations with industry specialists, we had learned that diapers in big-box stores are considered a loss-leader. However, we believed that a flattening retention curve indicated Product Market Fit; the next stage would be to expand the roster of products available and determine whether the club could produce a profit.

Simultaneously to this work, we determined that a major source of revenue could be found through private grants in support of programs that support progressive policy issues. If we could leverage the power of our audience in support of these policies we could access sustainable revenue from democratic funders. To demonstrate this, we executed an advocacy campaign in collaboration with a major local group, Moms at Work. The campaign brought together a group of moms online and in person in support of improved funding for after-school care in Ontario, and produced an online story with CBC and a television spot with Global News. In combination with a thoughtful brand, these elements resulted in secured funding for 2024.