Product Strategy – (Examples Included)
February 21, 2022 Edwin Kooistra
Products that change our lives, sometimes seem to have come into being because of disruptive innovation. Most of the time this is not the case. There is a whole well-researched and well-thought-out strategic process in place to give a breakthrough product that is intriguing and is also market-driven.
What Is a Product Strategy?
Product strategy is a step-by-step methodology that helps you define what you want to achieve or develop as a product and how will you be able to achieve it while going through different processes and taking different actions.
Product strategy also helps you in understanding the market and industry in which you are working as well as also helps bring all of your larger contexts of actions together on a common platform to be driven towards a common goal.
Your product strategy alongside product marketing is the blueprint that you and your company will use to develop a product or service and achieve your business goals.
The product development strategy or product strategy guide is one of the most referred to documents or frameworks in an organization. It is something that all the teams within a context rely on and as research has proven that in over 70% of the cases teams go back to the product strategy document when making important business decisions or setting goals and objectives.
The product strategy lays the guideline for how the product will be beneficial for the business, what problem will it be able to solve for the market segment and how will it fulfill the needs of the customers?
Sometimes a product strategy is also supported by product strategy marketing because marketing initiatives are needed to take your product to market and even for reaching acceptance of the same within the company itself.
Why Does Product Strategy Matter?
A product strategy in any organization or business is pivotal to the business’s success and growth. A product strategy matters because it guides the business’s direction. It lays down the foundation of where the business wants to go and grow in the future and how will they achieve it.
A product development strategy is needed by any business or organization to streamline its operations and processes towards a common goal.
Without the presence of a product strategy no matter how much hard work and effort you put in to take your business to newer heights, it will not produce the desired results because the efforts would be all over the place and not unified.
Each department would be working towards a different goal or objective and hence there would be a lot of confusion as well. Not only does the product strategy helps provide clarity but it also aids in keeping the different teams within the organization on the same page and working using the same business ethics and ideologies.
This necessarily means that not only is it relevant in terms of business goals and targets but also in terms of maintaining organizational integrity and culture. The product strategy helps you know to optimize your resources as well because you focus on one segment and satisfying their pain points.
How To Create a Product Strategy?
Setting up a product strategy is not easy. You must look at your product offerings, the industry dynamics, your competitors, market segment, etc., and try to bring all these important elements on a common ground that will not only satisfy their needs but will also be beneficial to your business and match with your product’s value proposition. There are a lot of product marketing agencies providing their expertise to help you grow your sales.
We will now look at a step-by-step approach to creating a product development strategy for your business.
Identifying the Target Segment
In the first and foremost step, you identify the target market segment that you would want to direct your product or service to. Here you develop their buyer personas and segment them further based on their demographics and psychographics etc. This is a critical step because your end customer is not only the motivation but has a say in your product development strategy.
Understanding their Pain Point
Now you will try to find a common ground between addressing a pain point of your target segment that will be of greater benefit to them and course overlaps with your product’s value proposition as well. This overlapping point is where this relationship will become beneficial for both of you.
Developing Product Vision
Here you will lay down your product vision i.e., where do you want to see your product in the coming years and how it will define your business’ success model.
Mapping Current State
Now you will analyze your current state that where your business is in terms of its product lifecycle as well as where are your customers in terms of satisfaction of their needs. Then you will map out the future state as well that where do you want to take the business in the deliverance of how well it will satisfy your segment’s needs.
Defining Product Design and Principles
You will lay down your product design principle and philosophy as well as priorities. Because sometimes there comes a decision very must choose a certain direction for product development strategy and if you set the priorities now, then you would know which way to take then.
You need to ensure that all your teams operating within the realm of the product development strategy as well as in its ecosystem, need to be aligned and synced in terms of the end objective and direction.
Just like with any other product strategy or business goal you need to lay out the metrics that will be measured by you to gauge your success and how well your product strategy has delivered results.
In this final step, you will roll out your product strategy and execute it in terms of making it a part of your organization’s strategic vision and rolling it out towards your target market segment as well.
Who Is Involved in the Process?
It may seem that in the development of the product strategy, the product team and of course the senior leaders of the company who carry heavy decision-making responsibilities are involved.
No doubt that they play a very pivotal role but alongside them, other teams such as finance, budget, human resource, marketing, etc. all play a role in developing the product strategy because each one of them has a stake involved in the process.
This also includes taking feedback and inputs from the organization’s external stakeholders as well and of course extensive market research.
Example Of a Tech Product Strategy
An example of a tech product strategy that we see nearly every day in our lives and is a part of our customer experience as well as Google’s product strategy for its search engine.
Google has set a product vision of providing the world’s information to us with just one click. They have developed their company’s business model and future success growth in relevance to our need as a segment. And the result of such a well-aligned product strategy is visible for all of us to see.