Definition: Product strategy is a term used to describe a business’s vision and overarching objective for a product. Specifically, it will communicate the why behind all the work a product team engages in.
Everything related to the product will be affected by a good, intricate strategy. This is why it’s crucial to get right.
It’s more comprehensive and action-based than a simple plan. A product strategy isn’t a few lines scribbled on a notepad in the white heat of inspiration — it’s a clear guide to keeping a business focused on the main priorities.
Taking any product from the first idea to the customer is a challenge. But establishing a product strategy lays the foundations for a greater chance of success.
Yet product strategy can grow and evolve as the team gets to work, too — it shouldn’t be treated as if it were set in stone. Rather, the strategy should allow for lessons to be learned and new steps to be created.
The overall desired outcome may be adjusted, too, provided there’s a good reason to do so.
But regardless of any changes implemented, the product strategy should continue to focus on making a product that’s best for both the business and the buyers.
Your business should have in-depth buyer personas ready to inform the strategy: this helps you tailor the product to the people you want to attract rather than targeting a general audience.
A comprehensive look at what product management is and how to distinguish what good product management looks like.
Creating and maintaining a product strategy involves extensive work, of course, and small businesses may be reluctant to lengthen the production cycle any further. But bringing a product to market without conducting in-depth research and strategizing is a far bigger risk.
So, we know what a product strategy is. We’ve touched on the reasons it’s so important. But why should your team invest time, energy, and resources into creating a product strategy?
Here are the biggest benefits.
Putting a product strategy into place empowers your team with a clear grasp of:
What the product is
Who it’s aimed at
Which pain points it addresses
When and where the USP is communicated
Why it’s right for your business
Everyone involved in the product’s conception, development, sales, and marketing will benefit from a well-designed product strategy. Focusing on the points listed above keeps your business focused on the key reasons why the product has to exist in the current marketplace and why buyers will want to pay for it.
There’s a certain degree of experimentation or trial-and-error in bringing any product to market. But small gambles that help you reach positive conclusions and make good decisions are entirely different from those which lead you down a dead end.
Creating an in-depth product strategy built on research and customer insights reduces the risk of wasting time on fruitless tasks. As we mentioned earlier, a product strategy allows for flexibility and alterations, but there’s still a roadmap to guide your team.
You’ll make smarter choices. You’ll be constantly working towards an outcome that’s in the best interests of both your audience and your business.
Developing a product strategy requires an understanding of what isn’t necessary in your product.
This kind of insight is garnered by conducting in-depth user research and customer analysis (which you may already have in the form of accurate buyer personas). These should be studied and referred to throughout the production cycle to ensure any product developments are in line with core market needs.
A product strategy is made up of multiple components. As we said, it’s not just a few lines scribbled on paper — it’s a well-considered, step-by-step system based on data-driven information.
Here are the key elements you must implement into your product strategy to achieve success:
Every product stems from an idea. And the product vision is your team’s chance to define what that idea is, who the product is for, how it’ll improve their lives, and why it has to exist. It’s basically a statement for your product and its desired outcomes down the line.
For example, Teach for America’s vision statement is particularly inspiring: “One day, all children in this nation will have the opportunity to attain an excellent education”.
This makes Teach for America’s aspirations clear. It summarizes the impact the organization aims to make on society, and the future, in a single sentence. Any product strategy that Teach for America develops should, therefore, support that fundamental objective.
While the product vision focuses on the product’s effects on consumers or the market, the next element is fixed on your goals.
What do you want this product to achieve for your business?
Double your ROI within a year?
Reach a new demographic?
Grow your list of subscribers?
These objectives should be concrete and actionable, not abstract. This informs your team’s work and strategies throughout the production cycle.
Don’t forget to gather customer insights for your product strategy.
Send out questionnaires or present brief surveys on your website to pick prospects’ brains. Try to discern what matters to your audience, and why they choose your business over another. Work towards understanding their motivations, pain points, lifestyles, spending habits, budgets — everything that leads them to make that all-important purchase.
The more you know about your buyers, the more likely you are to retain their customs.
A product strategy is crucial for any business, no matter how established they are. Launching into developing and releasing a product without this crucial documentation is a huge risk, even for global brands generating billions in revenue.
Creating a strategy ensures your product appeals to its target audience, serves a clear purpose, meets the standards of quality you want people to associate with your business, and aligns with consumer needs.
It can help you stand out in a crowded marketplace and minimize the danger of making costly mistakes.