What is a Product Strategy? Explanation, Guide, and Examples
The product strategy.
Here’s exactly what a product strategy is, why it matters, and how to make one.
Product strategy: TL;DR
A product strategy outlines the path to achieving the product vision. It’s a plan for how the product will meet market demands, achieve business objectives, and deliver customer value.
While the product vision serves as the north star, the product strategy is the roadmap that outlines how to get there. They work hand in hand to guide the product's journey from concept to market.
Key elements of a product strategy include understanding customer needs, competitive analysis, value proposition, revenue models, and a roadmap of features and capabilities.
A well-defined product strategy ensures that all efforts align toward a common goal, facilitating decision-making and allocating resources.
What is a product strategy?
A product strategy is a high-level plan to accomplish the product vision. It’s the how—the rough approach you’re going to take. It’s not a list of features with deadlines; instead, product strategies are broad enough to account for uncertainty and change.
The product strategy includes several key components:
Target market. This is the specific segment of the market that the product is designed to serve. Understanding the target market involves knowing who the customers are, what their needs are, and how the product can fulfill those needs.
Value proposition. This describes the unique value that the product offers to customers.
Product differentiation. This involves identifying and communicating what makes the product unique or superior compared to other offerings in the market.
Business goals. These are the specific objectives that the product aims to achieve. Business goals could include things like revenue targets, market share goals, or customer acquisition and retention rates.
Pricing and revenue model. This aspect of the strategy considers how the product will be priced and how it will generate revenue for the business.
A product strategy helps ensure that all efforts are aligned toward a common goal and provides a clear path forward for product development, marketing, and sales. It guides decision-making and helps prioritize features and initiatives based on their alignment with the strategy and their potential to drive value for customers and the business.
Product vision statement examples
Example 1: Here’s an example of a product strategy for Uber, from the great Melissa Perri. Notice that it starts with a vision statement, and then specifies a set of measurable goals and objectives.
An example of a product strategy for Uber. Source: Melissa Perri’s blog. Source.
Example 2: Here’s another example of a product strategy from Roman Pichler, using his product canvas tool. Again, notice that it begins with a vision statement, and then details the market, needs, key features, and business goals.
An example of a product strategy from Roman Pichler. Source.
Product strategy vs. product roadmap
Product strategies aren’t the same as product roadmaps.
A product strategy is higher-level. It provides the main pillars for achieving the product vision. In contrast, a product roadmap is a more detailed, often visual, plan document that outlines the features, functionality, and deliverables that will be included in the product. It often also includes timelines and resources needed to complete them.
The product strategy guides decision-making and inspires the team, while the product roadmap provides a detailed plan for achieving the product vision.
Product strategies are based on the product vision and help inform the product roadmap. Source.
Why have a product strategy?
A product strategy is useful for several reasons:
Provides strategic direction. A product strategy helps you understand, roughly, how you’re going to achieve your product vision. It helps guide your product efforts. It helps set expectations both within the team and with external stakeholders.
Aligns the team. A clear strategy helps align everyone in the organization—from product development to marketing to customer service. It helps everyone understand their role in achieving the goals your company has for the product.
Informs decision-making. A strategy offers a framework for decision-making, helping prioritize features, allocate resources, and plan initiatives.
Focuses efforts. It ensures efforts are focused on the right tasks. By outlining what the product aims to achieve and how it will get there, it prevents teams from getting side-tracked by ideas or features that do not contribute to the overall goal.
Sets up success measurement. A good product strategy includes measurable goals, allowing the team to track progress and assess the success of the product against these goals.
How to put together a product strategy
When constructing a product strategy, include the following key elements:
The product vision. The vision is the true north of your product, so use it as the basis for your strategy. This will help ensure your how is calibrated to your why.
Define your market. Specify the market segment for your product based on, including their jobs to be done. Use market research to define this.
Specify the needs addressed. Based on your market research, specify the needs that your product will address. This will help you focus on the most critical customer needs and develop features that directly address them.
Specify a unique value proposition. Identify the unique selling point of your product, including its key features and how they address the needs you identified. Also, clarify how your product is different from (and better than) existing solutions in the market.
Set product goals and objectives. Based on your market research, set clear and measurable product goals and objectives. This will help you stay focused on achieving the desired outcomes and prioritize your product development efforts.
Establish KPIs. Establish key performance indicators (KPIs) to measure the success of your product strategy. These should be based on your goals and will help you track progress toward your goals.
Determine a pricing strategy. Finally, determine the pricing strategy for your product, based on factors such as the target market, customer needs, and the competitive landscape.
Kareem is a co-founder at Savio. He's been prioritizing customer feedback professionally since 2001. He likes tea and tea snacks, and dislikes refraining from eating lots of tea snacks.
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