About 70% of companies consult their product strategies before making important decisions. It is proven that a detailed and comprehensive plan is vital in order to make sure that the tasks are performing correctly and efficiently.
Note: If your business is also related to online marketing or you have a website to administrate, you may need an analytical tool such as WatchThemLive to accompany you all through the way toward a successful product strategy. Read on to learn more.
What Is a Product Strategy?
A product strategy is a prominent plan that describes what a company wants to achieve with its products and what its plans are for achieving the product goals. It describes how the product can help the company, explains the issue that the product will solve, and the effect it has on customers and the business. The product strategy is a roadmap for creating a product. When you have a clear strategy, you can provide a clear product definition of what you aim to develop. Nearly all successful product strategies have three key points in common.
1. Have a Purpose
Having a product strategy means your products should have a reason for existing and even something beyond, not just being produced just for the sake of creating something. So, to take the first step, you should figure out what your purpose is and get the entire organization to give it their support.
2. Understand Customer Needs
Having products without customers can do no good. You should have a product strategy that is based on customers’ needs. An important point here is that customers need change over time and you should be aware and ready to adapt your products to their needs.
3. Measure Success
There is no way to make sure your strategy is working unless you keep scoring. You know that the strategy itself shouldn’t be hitting any specific metrics, but to measure product success, you can track the KPIs to clear up the progress and put forward any future caveat signs.
What Are the 7 Types of Product Strategies?
A production strategy depends on the industry, size of the company, and goals of the business. It is a great help to understand what different types of strategies are out there. These strategies can help you in making rational decisions while proceeding with a project. You can find the different types of strategies in the following.
The main goal of product rationalization is to reach a maximum number of customers along with a minimum number of products. This strategy will help you to invest more in the products with more profits. As lots of money should be spent on the production line, the businesses should prioritize the cost-cutting by taking different steps such as production on a large scale. By increasing the production, all other expenses such as advertising, promotion, research and developments, and customer service become rational due to the large production.
It is wise for companies or organizations with low-quality production to follow this strategy.
The price of a product or service directly depends on its perception of the market. In businesses where prices can be set, it is important to evaluate the benefits and value of the product and to consider how they are perceived by consumers. It is also possible to have other companies’ impact on your price element. It means some prices are determined based on the going rate in certain markets where there is no control over the price. Your competitors may also influence your products’ prices by affecting the pricing methods.
Assemble-to-order (ATO) is another production strategy in which companies produce products on a costume-order basis and store their inventory as assemble-ready components. It means that companies possess the necessary parts for these goods and only proceed to assemble the items when they receive their customers’ orders. The result of employing this strategy is that companies avoid stocking large quantities of products and this can help reduce inventory costs. Since production depends on the number of orders, businesses can mass-produce and provide products and services to their clients.
Imagine you have managed everything in the best possible way and still, there is a problem with the product’s delivery. All your efforts would be wasted if your customers face delivery issues. To avoid a wild-goose chase, businesses elaborate on creating a robust delivery network from the very first steps to the end consumers. The supply is then delivered to dealers, wholesalers, and retailers to protect your business from the other intensely competitive organizations.
5. Environment-Friendly Product Delivery
An important part of our lives is the environment we live in. Typically, people appreciate companies that respect their environment and target customers through eco-friendly or green products. In recent years, there was also a campaign against animal cruelty cosmetics, and clothes. The more thoughtful you are in your production and delivery methods, the better your customers like your business.
6. Excellent Pre and Post-Sales Customer Service
One of the best strategies for companies to build trust among customers is by providing them with excellent pre and post-sale customer service. As a business, you need to assure customers about superior services like round-the-clock availability of customer services. Studies revealed that an effective sales process makes all the difference for buyers and it starts from the pre-sale stage to the post-sale to make the customers feel accompanied.
7. Customer Value
Customer value refers to the way customers will perceive the product and its worth. This strategy mainly focuses on the products and services values and benefits. Customer value includes determining if the product can provide a failed desire or solve the possible issues for the customers. A target market refers to the consumers that are considered to be interested in making a purchase from your brand. What is crucial in target marketing is to ensure products can reach potential consumers.
Creating customer value can increase customer satisfaction, customer experience, loyalty, and your product’s price; not being able to create customer value will result in the opposite way.
What Are the Steps of Product Strategy?
As we discussed earlier, we can say that the product strategy describes how the product helps the company to improve and it explains the issues that the product will solve as well as the effect it will have on customers and the business. We have made a list of 8steps that can help in creating a better strategy for your products.
1. Understand Your Users
To start with, you need to research to understand who your target audience is and gather some information about their lives and preferences. After targeting the audience, you should see what their needs and pain points are. You can now create user personas. Personas that include information like users’ location, age, gender, occupation, income, and preferences can help the team understand who to create the product for.
For a better understanding of your target market, you can use a behavior analysis tool such as WatchThemLive and get invaluable insights into your users’ behavior. For example, tracking your users’ interaction with your website can be a good start. You can use session replays to watch the whole customer journey. This way, you are able to see if they face any problems and fix them immediately. You can also learn about their navigating pattern and build your website based on this information. What are you waiting for? Sign up now and see what’s next!
2. Define the Problems and Pain Points
A crucial part of product strategy is defining the actual problems. Dive into the situation and be curious about the situation, its background, the recent changes, its impacts, etc. Then, you know what the situations and the complications are. Now, you can look for the solutions and the best statements are SMART, which is the abbreviation of:
“Specific, Measurable, Achievable, Relevant, Time-based”
3. Define Your Product Vision
By defining your product vision, we mean defining your view of the future. The vision is a simple statement and is compelling, easily understandable, and should capture the product’s purpose. This is where you should be driving all downstream roadmap, strategic, and tactical decisions. A well-articulated vision is simple to remember, catchy, and easy to understand. Creating a clear vision can help you in your achievements, earning approvals, prioritizing by mapping, etc.
4. Conduct a Competitive Analysis
You should begin with understanding who your competitors are and what has made them be in such competition. To understand the strengths, weaknesses, opportunities, and threats of yourself and your competitors, you can do a SWOT analysis. Another thing to consider is the possible future changes and their possible impact on your business and product strategy.
5. Establish Business Objectives
Business objectives are specific measurable goals. They can help you understand what you are going to achieve with your product launch, how you can measure the success of your product, etc., to improve customer satisfaction, revenue, and efficiency.
6. Build a Product Roadmap
A product roadmap is a shared source of truth that outlines the vision, direction, priorities, and progress of a product over time. It is a guiding strategic document that communicates the why and what of the product you are building.
7. Talk to Your Customers and Design Your Product
Don’t underestimate the effect of communicating with users and customers. You need to validate your ideas before launching a prototype. Once you are done validating your ideas, it is time to design and build your product.
8. Launch Your Product
And the last step is to launch your product. Make sure you have measured your progress and course-correct along the way repeatedly on the experience. Try to always have your goals in mind.
After launching your product, you need to make sure nothing goes wrong. To achieve such a goal, you can use features like session replays to observe the whole journey of visitors on your website, or a heatmap to find out about the most and least engaging elements of your webpage. This way, you can see if anything is not functioning as it is supposed to and fix any unexpected problem as soon as you notice.
In this article, we have gone through all the aspects of product strategy and the way it can impact your business. Now we can summarize a product strategy as something that enables you to focus on your target market and features set by stating where the products should go and how they should be delivered. So the first thing you should do is to realize your customers’ needs, sign up in WachThemLive and find out what their needs are.