Product Strategy is Your Power Animal

by | Oct 22, 2021 | Uncategorized

With 2022 around the corner, you may be thinking about product planning. How about a 3-5 year product strategy to give shape to your annual plans, and your quarterly roadmap?

As a PM, you’re not only setting long-term vision, but also overseeing execution and getting diverse stakeholders on board.

And considering that product management touches not just innovation and but also development, marketing, sales, and support, how can product strategy help? It will keep your team and cross-functional colleagues on the same page during feature innovation and development.

Product strategy will also help you quickly and confidently make tough decisions with competing priorities across teams.

 

DEFINING PRODUCT + STRATEGY

Product is the thing that connects the reasons your business exists to how it serves your target customers,…

…While business strategy is a general plan to achieve long-term goals under conditions of uncertainty.

With your product strategy, then, you are bringing together your business’s and your customer’s goals at the meeting place of your product, within the uncertain conditions common to business practice.

 

WHY PRODUCT STRATEGY?

This Japanese proverb puts it aptly: Vision without action is a daydream. Action without vision is a nightmare.

Your product strategy keeps your product plans, your  roadmap, and daily decisions in line with longer term, 3-5 year goals. To this end, product strategy should be propelled by customer validation and market insight.

You need a product strategy for product execution. Without strategy, your execution will move from putting out one fire after the next, or moving from one deal to the next.

With a product strategy, when you’re forced to decide on competing priorities, you confidently know which way to turn. And your cross-functional team mates can more clearly understand your decisions.

 

USERS VS. CUSTOMERS

Your product strategy doesn’t just consider your users, it places them in a wider context of the market (your current and future customers).

Viewing your product from the standpoint of both the market and the user is necessary in creating a product strategy. And is especially key if your users are also your buyers, which is the case for many software/SaaS programs. 

 

STRATEGY: THE PRODUCT VISION

Why are you building this product, and why should customers care?

Your product vision gives a high view of how your users’ lives will be improved. For example, your vision can be built around:

  • Meet customer needs, which are often latent and implicit
  • Build to customers’ explicit, stated preferences
  • Create the product first, and then find the market for it
  • Relentlessly iterate based on market changes/trends

 

STRATEGY: PRODUCT POSITIONING

What place in the competitive landscape will your product have?

Here are examples of longer-term positioning goals to guide your strategy. They aren’t detailed, but rather high-view. (Your annual plan is more of the place to detail the product details & qualities that will be the focus of product positioning.)

  • Be aware of the market leader – differentiate yourself by knowing your competitors’ strengths and weaknesses; if your product is novel, establish yourself as a market leader
  • Become a market challenger – your innovation or quality is comparable to the market leader, you are working to disrupt the established market
  • Stay a market follower – you’re a copycat of the established market leader at a lower price, forgoing innovation, R&D, marketing, and advertising
  • Dominate a niche market – attractive to smaller companies, or those without the resources for widespread campaigns

 

 

STRATEGY: GROWTH VS. REVENUE

What is more important to your product’s business goals, revenue or growth? Getting to market first? Standing out or keeping prices low?

Some trade-offs to consider:

  • Prioritize growth by solving a widespread problem
  • Prioritize revenue by focusing on customer retention
  • Balance brand differentiation with price
  • Timing – the first to market, a fast follower, or a laggard
  • Leverage supply chain management to keep costs low & quality consistent
  • Divest old products and acquire new ones

 

STRATEGY: WHO’S YOUR TARGET MARKET?

Creating a winning product strategy is dependent on knowing the customers you’re targeting:

  • Innovate for current markets
  • Or innovate for future markets
  • Modify existing products for your current market
  • Or modify existing products for your future market
  • Search for new markets to adopt your existing products
  • Sell your existing products to existing markets (compete on margins or distribution)

 

BUILDING PRODUCT STRATEGY: MARKET RESEARCH

There are differences between market research and user research, and yet they complement each other.

If user research is focused on deep diving into usability and features of the moment, then market research is providing a larger context to that usability, including purchase patterns, willingness to pay, desired outcomes/pain points beyond the product itself, and opinions and values linked to interest in the product and its features.  

Here are a few ways market research can build your product strategy:

  • Customize features to customer needs (build features to the discovered needs)
  • Validate your product/feature innovation
  • Discover granular customer segments to best group features
  • Evaluate market entry prospects, determine which markets are the best fit
  • Know your competition, in order to position, differentiate, and capitalize on unmet needs

 

REFERENCES

 

We hope you enjoyed this blog and that it can be of use to your product innovation and development!

 

Reference list:

www.plutora.com/blog/product-strategy-guide-examples-and-best-practices

www.tcgen.com/product-development-strategy/https://en.wikipedia.org/wiki/Strategy

www.quora.com/How-important-is-it-to-create-a-product-strategy

smallbusiness.chron.com/list-product-strategies-18636.html

www.crayon.co/blog/the-role-of-market-research-in-your-product-strategy

startinfinity.com/product-management-framework/product-strategy

startinfinity.com/downloads/Product-Management-eBook.pdf

medium.com/reassemble/market-research-vs-user-research-are-they-the-same-3ec59dec637f

visionedgemarketing.com/inform-product-strategy-with-market-and-customer-research/

businesswire.com/news/home/20191112005111/en/How-Market-Research-Facilitates-Creating-a-Flawless-Product-Strategy-Infiniti%E2%80%99s-Latest-Blog-Explains