Thinking of launching a new product? Or are you working on upgrading your existing one? If so, you need to develop a product strategy plan to make sure your product has market potential and meets customer needs.
A well-designed product strategy planning process helps to anticipate pitfalls and identify risks. It will also give you insight into the data analytics, research, and marketing angle to measure success and include business objectives. With a product strategy plan, you’ll be able to set a clear vision during the product discovery and development process of your new product.
Contents
What Is a Product Management Strategy?
A product management strategy is a high-level plan that describes what a company wants to achieve with its product and how it plans to achieve it.
The strategy should answer three key questions:
- Who the product will serve (personas)
- How it will benefit the users (what problem will it solve)
- How it will benefit the company’s objectives for the product life cycle
A good product management strategy is not just a statement. It’s a plan – usually described in a roadmap form – that includes your vision and what you want to do in the future, as well as charts of how you’re going to get there. And it doesn’t stop at what you want to sell. It also has to include how you plan on developing, marketing, distributing, and selling your company’s products or services.
Many businesses think about the business element when creating a product management strategy. They need to consider the product side too. A strong product management strategy will help your company through all aspects of running the business. This makes the work of the Product Management Lead particularly valuable.
The Main Benefits of Creating a Product Management Strategy
A great product management strategy will help you grow your business and increase your sales in the long term. Thus, growth comes from generating new leads and increasing conversions from existing customers to improve your product.
The best way to do this is through the creation of a product management strategy. You should invest in new products and make sure your marketing efforts are effective.
A product management strategy outlines all the steps you need to take for success in the future from product vision through research, and development, to marketing and sales.
You can think about it as a roadmap of where your company is heading. It helps you stay on track to reach your goals. It accounts for every aspect of developing products and marketing those products successfully.
Key Elements of Top Product Management Strategies
Creating a good product management strategy isn’t an easy task. You should base your plan on the specifics of your market, your users, and your company. You need to review the existing and necessary tools, applicable frameworks, and who you need to involve in the process of designing and developing the product.
There are five key elements of a top product management strategy.
Driven by vision and purpose
An effective product management strategy will always be in your company’s vision and purpose. This is the foundation of your product management strategy and what makes it different from competitors. It should communicate the brand’s personality, how you make a difference in people’s lives, and why you exist.
Satisfies the user needs of your target market
One of the best ways to think about your product management strategy is to identify the needs of your end users and your target market.
For example, you’re running a shoe company and are looking to release a new line of sneakers. Consider what type of sneakers potential customers are looking for. You could research what existing products are popular in your industry. Or, talk with people who have purchased running shoes before to find out what they would like next from you.
It’s important that you understand the current needs of your target market. Also, consider any future needs that might emerge as consumers change their preferences or as new technologies become available.
For example, say that one day someone invents an air-filled sneaker (i.e., a sneaker that doesn’t need to be inflated). If you don’t take this potential future need into account when developing your product management strategy, you might find yourself with fewer customers than expected because you didn’t keep up with changing trends and technologies. Or, inflatable shoes might be a passing trend you can safely ignore.
Whatever the case, you should plan for the needs of your customers. You can apply different methods and use business canvases to validate customer needs and product-market fit, such as Lean Startup.
Presents a collaborative process
The best product management strategy is one that’s developed collaboratively with the product team, stakeholders, and company executives. The first step to creating a successful product management strategy is not to do it alone.
You need to bring your team together for brainstorming around e.g. a story map to generate ideas and get their input on what the company needs and who they are targeting.
This will help you identify:
- what type of products you should offer
- which market segment do you want to focus on
- how you can stand out from the competition
One thing to keep in mind is that it’s easier for people to come up with new ideas when there are multiple viewpoints in the room. With so many different points of view, your team will find innovative solutions to today’s pressing challenges.
You’ll acquire a variety of viewpoints and gain stakeholder buy-in on your product management strategy if you promote cross-functional collaboration as a leadership approach.
Is adaptable but stable
Product management strategies should be adaptable but stable. When you’re building a strategy for the future, it’s important to consider evolving opportunities. Additionally, consider any changes in the need that may require adjustments to your plan.
However, you also need to maintain a degree of stability. This is especially true if you have established revenue models or partnerships.
It can be difficult to balance flexibility with stability. One way to do this is by setting up a buffer zone that provides room for flexibility. That is, without jeopardizing your current business model.
Measures important products and business results
One of the best ways to create an effective product management strategy is to be able to measure key outcomes. Measuring key business outcomes is just one way to test the success of your digital marketing strategy.
If you have a clear overview of what your goals are, it’s easier for you to determine whether you’re making progress. You’ll need to know what your objectives are, how much time and money you have, and where you can make cuts if needed.
When you have all that information in front of you at once, it becomes easier for you to see where your process may be going wrong—or what might be missing from your plan altogether.
The goal of the product management strategy is efficiency and clarity. So, most product managers use specific figures and metrics for the roadmap, product plans, and product activities.
The plan must be defined, though, so that a clear and quantifiable benchmark can be tested. That is to see if the product achieves essential objectives. This requires tying in certain metrics and targets to the strategy’s vision of a successful product. That is so you can reach daily, weekly, or monthly active user (AU) goals. It also helps measure monthly recurring revenue and retention rates.
What Is a Product Strategy Plan?
A product strategy plan is a document that describes the company’s next steps for developing, marketing, and selling the product. It explains the company’s product vision. It also details the product plans, resources, and timelines required to reach that goal. A well-planned product strategy plan helps the company achieve success with its products.
The Main Benefits of Creating a Product Management Strategy Plan
A great product management strategy will help you grow your business and increase your sales in the long term. Thus, growth comes from generating new leads and increasing conversions from existing customers to improve your product.
The best way to do this is through the creation of a product management strategy. You should invest in new products and make sure your marketing efforts are effective.
A product management strategy outlines all the steps you need to take for success in the future from product vision through research, and development, to marketing and sales.
You can think about it as a roadmap of where your company is heading. It helps you stay on track to reach your goals. It accounts for every aspect of developing products and marketing those products successfully.
Product Strategy Plan vs Product Planning Strategy
The product strategy plan is a high-level document that provides direction for new or existing products.
A product strategy defines the viability of the product and its market potential. Also, the product strategy outlines how it will fit into your business goals.
A successful product strategy plan includes these key elements:
- A description of the critical challenges
- The solution that the new product offers and its measurable outcomes
- The desired results for the most value
- An organizational alignment and a release schedule
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Types of Product Strategy Plans
Product strategy plans based on the outcome
In addition to a company’s vision, it is useful to have a product strategy that breaks down the product vision to the implementation level, i.e. outlining how they intend to realize the vision through their products.
These product strategy plans may be different for each product, but the types below cover everything:
1. Come up with something new
The company’s mission is to solve a problem that already exists, come up with a solution that has never been seen before, and take advantage of a market opportunity.
You’ll either change the industry and make history, or you’ll get nowhere. Some companies create successful products, while for some products success never comes.
The model can also help you meet customer needs and manage the product life cycle.
2. Make solutions better or look at them from a different angle
Another way to think about product strategy is to find a solution that already works and make it better.
If you do thorough market trends research, you can find the flaws in existing solutions. Use that to your advantage by making a better product.
You can also try something new by making a product that makes a problem easier to solve.
3. Get rid of features
Sometimes, a product’s popularity is hurt by the fact that it has too many expensive features.
One way to improve the user experience is to make solutions with fewer features or a “lean” product. Getting customer feedback also proved useful.
4. Invent something backward
Backward invention is another popular way to market a product.
This strategy used by tech giants like Amazon is usually used by companies whose products do well in developed areas.
It means making a simpler version of a product that already exists. The goal is to get into a target market that isn’t as big as the one that already exists.
Product strategies listed by market share
Another way to group product strategies is based on market research and the resources that are available.
Here are four more ways businesses can approach their product strategies:
1. Leader
Companies that are on top of the market, or have most of the market opportunities, usually have a lot of resources to use.
They take advantage of this ample supply and put a lot of money into making new products.
2. Follower
Companies with a market share below average don’t often use innovation to drive their product strategies.
They don’t have to because that’s how their brands are set up. So it makes sense that they don’t put much money into research and development.
Instead, their product strategy is to follow the leaders in the industry. Then, they try to improve on whatever they come out with.
3. Challenger
Challengers focus more on coming up with new ideas than on copying the leader.
They, too, have a lot of money to spend on developing new products.
But they still don’t have enough market dynamics to be the leaders.
The main goal of a challenger business is to take the top spot away from the leaders. That’s what their product strategies are all about.
4. Niche
A niche product strategy is one that focuses on a group within a group.
Companies that use this strategy don’t want to take over the whole market. They only want to be known for one specific part of it.
Competitive product strategies
Cost Strategy
The cost strategy aims to make the greatest product for far less money. It analyzes available resources and saves money in the production process.
If you can make a cheaper product than your competition, you’ll succeed.
Differentiation Strategy
This strategy focuses on giving your product a personality that will help your customers remember and enjoy it.
Focus Strategy
If your company has a large consumer base, design a product for a single buyer persona.
This method focuses on the needs of a specific group of people and comes up with a solution that fits those needs.
This is a great way to build brand loyalty.
Quality Strategy
The quality strategy helps you detect risks and avoid problems. It will also show how the new product or service fits into your company’s long-term ambitions.
Service Strategy
A service product strategy is a plan for launching a new service or product. This strategy aims to detect risks and avoid problems.
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Collect product ideas
Before you start developing a strategy, it’s important to collect all of the product ideas on an idea board. You can collect these ideas by brainstorming with your staff or by holding focus groups with your market. See which products and services seem to be getting the most attention from customers. Draw conclusions that might have the most potential for growth.
Create user personas and user stories
When developing company plans, you need to identify your typical target customer. You need to understand the customers and create user personas and user stories. The persona is an individual who represents your target customer. A user story includes the persona’s goals and motivations for using the product.
Create a product strategy plan and build it like a product roadmap
A product strategy plan can be similar to a product roadmap. It contains a timeline and maps out the steps you’ll need to take to turn it into a success. It’s important to make sure everyone on your team can understand the product roadmaps.
When developing your product strategy plan, start by making sure it’s comprehensive. This means considering all aspects of the research, data analytics, and marketing plan for your new product. Never forget that the product strategy plan must be in line with the product vision and the strategic goals of the company.
Write everything down so that every member of your product team can stay focused. Once you have a plan in place, make sure that both the participating teams and stakeholders know how they can help in the product lines.
Once you’ve laid out what needs to be done, use KPIs (key performance indicators) to measure progress toward achieving goals like sales targets or launch date targets. A well-developed strategy should also include milestones for measuring key results.
Conclusion
At the end of the day, if you want to develop a great product strategy plan, you need to have an effective process. Think of it as a map that will help you get to your destination. The more detailed and well-thought-out that plan is, the more likely you are to get where you want to go.