In between a good idea and an awesome product is a great product strategy. It defines the problem your product attempts to solve and how it plans to do so. In simpler terms, it is your to-do list to achieve all your product goals.
In this blog, we will take a look at the importance of product strategy for product teams and their leaders, the three major components of product strategy, and the pitfalls it will help you avoid.
First, let’s understand why product strategy is important for founders and product leaders and how it will help them formulate a roadmap.
Importance of product strategy for founders
To build great products, founders and product leaders must first understand who they are building for, why they need this product, and how to make it stand out from similar offerings in the market.
A solid product strategy helps founders to find answers to these critical questions and gives them an understanding of these five aspects of product management:
1. Product vision, market size, and USP
A good product strategy helps founders understand what makes their product stand out, so they can work towards it in accordance with their product vision. It also helps in determining the market size.
2. Planning and execution
It is natural for founders to feel overwhelmed with planning and execution in alignment with the business goals. A thoughtfully constructed product strategy simplifies planning and execution in a systematic way.
3. Knowing the users
Product strategy equips startup founders with the lens to identify and understand their users. This helps them work towards building a relevant product with defined metrics and clarity on what to build and when.
4. Understanding the competitors
Product strategy helps founders gain an understanding of the competitive landscape in order to direct their efforts accordingly. Competitor Analysis is an essential part of better decision-making while building products.
5. Getting a prototype to present to investors
Founders are in a much better position to get funding from investors if they can present a prototype. With a product strategy, they can prioritize features for the prototype that can convey their unique product idea to the investors.
How a solid product strategy will benefit your team
A good product strategy acts like a guide for your team and helps you prioritize what needs to be built first. Functioning like your reference point, it will help you measure success at different stages of the production process.
Here’s how your team can benefit from having an on-point product strategy:
1. Clarity on what to do and when to do it
A clear product strategy empowers your team to work towards milestones in a systematic way. An organized strategy will ensure efficient communication and prevent your team from losing track of their goals.
2. Improved tactical decisions
No matter how well you plan, you will sometimes encounter unforeseen circumstances that could make you deviate from your main plan. With a good product strategy, you will have clarity on your goal and this will help your team think on its feet and adjust accordingly to cater to changing conditions.
3. Product roadmap prioritization
An efficient product roadmap helps your team prioritize the right tasks. In the absence of a clear strategy, your team may end up wasting time and effort on tasks that do not require as much effort. A proper product roadmap and strategy will ensure that they are always on the right track.
Three Major Components of Product Strategy
Product strategy is a combination of many components that when combined, create a total plan ready for execution. Listed below are the three most important components of product strategy.
1. Market vision
The market vision defines the users of your product as well as the opportunity for your business. It identifies your target market, the position your product will take in the market, and how it will function vis-a-vis your competitors. This vision should also be inclusive of your go-to-market plan according to your user’s needs and how you’ll bring a competitive offer to them.
2. Product goals
It is important for you to define key objectives in order to build a product strategy. These are the specific, quantifiable metrics of success you will achieve by building your product. They act as guides for your development teams and help you measure the success of your product after its launch.
3. Product initiatives
These initiatives let you define key work that needs to be done in order to achieve your product goals. In keeping with your company’s core strategy, these must help your team understand the exact goals for the users and the business.
Pitfalls to avoid with Product Strategy
Having looked at what product strategy helps you achieve, let’s now look at the pitfalls it helps you avoid while you are busy building great products.
1. Wasting time & Burning money
In the absence of a good product strategy and an organized list of priority tasks, you may end up wasting a lot of money and effort on what is absolutely not required at a particular stage. This delays your product’s time to market. A good product strategy helps you save money and time, by helping you prioritize tasks and allocate resources according to the need of the hour.
2. Jumping to (wrong) conclusions
Without identifying the crucial first questions and defining the key problem, you cannot determine the course of action for your product development. Jumping to the conclusion straightway might lead you to overlook important details. Product strategy helps you avoid this mistake by enabling you to make complete sense of the scenario.
A good product is dependent on good communication among team members. Any gap in communication could be costly in the course of product development. It minimizes the chances of miscommunication by keeping members on the same page with regard to progress.
Product strategy ensures that your efforts are pointed in the right direction throughout the development process. It organizes and simplifies tasks for all your team members by keeping them informed of what is expected of them, and helps them get a better understanding of their individual and collective responsibilities.
Siam has a Product Strategy and Consulting Team that can help you plan your product development right from the start. This will help you stand out in the market as the maker of exceptionally designed products. Now that you are aware of how crucial product strategy is, let’s work together to engineer possibilities.
Reach out to us to start building your products with just the right amount of time and effort to be invested in each process.