Elements of product strategy – With a product strategy, the attempt is at predicting or figuring out what the future of a product would be. It helps to clarify the steps to take toward making the product a success.
Getting your strategy right isn’t the easiest of things to do. But it is also not overly daunting if you understand your market well and you are good at paying attention to details.
What is a product strategy? What should it have? We discuss these in the article, along with steps for creating an effective one.
The Relevance of a Product Strategy
A product strategy is a high-level strategic plan that describes what products should achieve, considering a company’s vision, and how to make that possible. It defines what a business hopes to achieve with its products and how to accomplish them.
There are multiple reasons businesses need to have product strategies. They include:
Clarity – With the aid of strategy, it becomes easier to make teams know how they contribute to the success of a product. This can enable them to work more efficiently.
Decision-making – You and your teams may be able to make better decisions when you have a strategy. When in doubt or confused, you can quickly revert to the plan.
Prioritization – A good strategy will help for prioritizing things to do. You should ideally have one to develop a result-oriented product roadmap on which you prioritize tasks.
Your strategy helps to provide answers to questions, such as “Who is the product for?” and “How does it aid the achievement of company goals?”
What Should an Effective Product Strategy Have?
There are certain elements a good product strategy should have. Below are some of the most important ones.
Your strategy must factor in the product vision. This comes as a product vision statement that stipulates what you hope to achieve after some time or years. What do you see the product becoming in the next 3-5 years?
- Business goals
Your product strategy should also try to make clear what benefits the product will bring to your company. Business goals are usually tied to the company’s vision and inform what you consider more important when developing your product.
These goals influence the key performance indicators (KPIs) that you focus on for measuring the success of your offering. An example goal could be to generate $5 million in revenue over a period, say, six months or a year.
- Value propositions
Research is a vital aspect when trying to define your strategy. It reveals what needs that you can help address with your product.
Your product strategy uses what you found in your research as inputs. It provides clarity about what your product should offer to stand out in the market. Why should a buyer choose yours over a rival’s? Your strategy should help provide an answer to that.
You may also think in terms of initiatives, which are high-level objectives that you break into smaller tasks for easier execution. As an example, “improving the user experience” could be a product initiative.
How Do You Create a Good Product Strategy?
There is no single approach to developing a product strategy. The process someone suggests may not be the same as that another person proposes.
However, the following steps should result in an effective product strategy.
- Develop a charter
You may want to begin the process of creating your strategy by having a product charter. This helps to ensure that what you do as a product manager aligns with the goals of your company. Along with relevant business goals, it states the mission of your product team and what results are expected.
- Carry out your research
As we pointed out earlier, research is integral to a product strategy. You are able to know your customers, their needs, and what your rivals are doing through strategic research.
Market research enables you to identify feature gaps and opportunities that you can tap into with your product. The information you get will certainly go a long way in developing a winning strategy.
- Consider the necessary resources
No matter all you may be planning to achieve, the resources at your disposal will determine how much you can do. You will do well to think of this before defining your strategy.
What advantage do you have over the competition for solving identified problems? What technology do you have or need to acquire to produce a winner? It is helpful to try and find answers to questions like that.
- Write a product vision statement
Based on what you have learned in the previous steps, you then need to articulate your product vision. This means so much to your product strategy – it determines what it would be. Your product vision statement spells out why there is a need for a product and for whom as well as the extra value it brings. It doesn’t have to be too long; one or two sentences are enough.
Your product strategy document brings all this information together to provide direction for your product.
A product strategy links the vision to the roadmap. The product vision determines what it would be. In turn, the strategy controls what should feature on your product roadmap.