Tips for developing a product strategy
1. Stand apart by offering a solution, not just a product
Think about the worldâs most memorable and iconic products. Venerable brands such as Coca-Cola, Apple, and IKEA are likely among the names that readily come to mind.
Why are these products popular? Especially with so many similar items on the market. They stand apart because their product strategy is to satisfy basic human needs, like:
- The need for belonging or to identify with a group
- The need to be understood or express ourselves
- The need for accomplishment and independence
Coca-Cola was never just a beverage company. Even its proprietary bottle reflects its status as a distinctive brand with a global mindset. Apple offers more than smartphones and laptopsâit represents a lifestyle and creative ethos. As the first $1 trillion US public company, no one has changed the way products look, feel, or work more than Apple.
With IKEA, people arenât just buying furniture with a minimalistic design aesthetic. They are fulfilling a sense of achievement from working with their hands or exerting frugality.
Such distinctions offer customers the type of value that competitors canât easily match. And the solutions your offer are not limited to product features or traits. Your product strategy might play upon the convenience derived from your companyâs ability to secure prime retail-shelf space or its use of customer-data mining to help create new products.
Solving problems creates value. And value will always help your product stand apart.
Within your product strategy, ensure that you can identify the problems your customers face and the solution your product provides. If this proves difficult, take time to reassess.
RELATED: Learn how to build a product roadmap in Lucidchart to better understand what your customers and product needs.
2. Quickly adapt to industry changes so you donât become a âone-hit wonderâ
People naturally gravitate toward products (and companies) that offer value that others canât match. This value isnât just tied to cost. Itâs how a product continues to differentiate itself from its competitors or how a business strives to stay relevant to its customers.
Customer loyalties change. So, if you already have a successful product, resist the urge to become complacent. Situational awareness should be part of your product strategy.
And if change or disruption within your industry leads to an opportunity, capitalize on it.
Case in point. Today, âon-demandâ is part of the everyday vernacular. But according to Variety, those now-familiar words were dismissed by one-time Blockbuster CEO John Antioco as he abruptly ended negotiations with a âvery small niche businessâ in 2000.
That business was Netflix. Its founder, Reed Hastings asked for $50 million to give up his company. In 2018, Netflix went on to post its largest ever US profitâ$845 million.
As for Blockbusterâby January 2014, all 300 of its US corporate-owned stores would close. At one time, it had dominated the video rental business. But its leadership failed to recognize the opportunity in acquiring Netflixâs burgeoning DVD-by-mail business.
Unlike its predecessor, Netflix would not be a one-hit wonder. It would shift its product strategy to adopt online-streaming and start creating original programming of its own.
Industries quickly changeâso do customer loyalties. As you can see from these product strategies examples, you need to be ready to change or adjust your product offering accordingly. And always take advantage of opportunities for quick wins.
3. Use self-disruption to inspire sustainable growth and innovation
Nothing lasts forever. Market demand and sustained growth are no different.
Eventually, peopleâs interests change. The once-large audience for your product begins to diminish and is slowly replaced by a new generation of consumers. One with different tastes and perspective. Inevitably, the demand for your product completely stagnates.
In this situation, it seems youâve become a victim of your productâs one-time success.
As growth-strategy consultant and acclaimed author Clay Christensen describes in his best-selling book, The Innovatorâs Dilemma, if you work in technology, you know the life cycle of products is on endless repeat. Basically, it looks something like this:
- Your new product is a success and builds an audience.
- A newer product emerges and ups the innovation ante.
- These usurpers also grow, only to be displaced as well.
Christensen suggests that sustainable growth comes from aggressively seeking to kill your cash cow before someone else does. Instead of trying to protect what you already have, your efforts to innovate may need to destroy it. Once you are willing to cannibalize your existing audience, you can have a product strategy that can survive in the long-term.
Steve Jobs once said, âIf you donât cannibalize yourself, someone else will.â
Sure, the iPhone cannibalized much of Appleâs iPod business. And the iPad cannibalized the sale of Macs. Yet, the product strategy championed by Jobs prevailed because he recognized the larger audience he wanted to captureâthe massive Windows market.
If Jobs had limited his ability to innovate new products out of fear of losing market share for its flagship iPod and Macbooks, would Apple be the successful company it is today?
As the worldâs largest book retailer, Amazon made a similar decision when it released the Kindleâknowing that it would take away from the audience that purchased physical books. But they also knew that if they didnât offer a digital product, someone else would.
Be fearless in your product strategy. Your innovative new product might disrupt existing sales. But then, you are the ones who are keeping innovation central to your company.
Putting it all togetherâyour product strategy roadmap in action
Taking a product from idea to reality doesnât happen overnight. At each stage of product development, you must be willing to innovate, adapt, and make changes. By developing a product strategy, you will be better equipped to achieve your companyâs objectives.
