Product strategy

Product strategy defines the high-level plan for developing and marketing a product, how the product supports the business strategy and goals, and is brought to life through product roadmaps. A product strategy describes a vision of the future with this product, the ideal customer profile and market to serve, go-to-market and positioning (marketing), thematic areas of investment, and measures of success. A product strategy sets the direction for new product development. Companies utilize the product strategy in strategic planning and marketing to set the direction of the company's activities. The product strategy is composed of a variety of sequential processes in order for the vision to be effectively achieved. The strategy must be clear in terms of the target customer and market of the product in order to plan the roadmap needed to achieve strategic goals and give customers better value.
Product strategy aims to provide context for what the product and business intends to achieve, the target customers and market, and the work to accomplish.
Vision provides the big picture of what the company is trying to achieve. Without vision, it will be difficult for stakeholders to understand its direction and it will lack connection to a broader picture.
Execution is defined by the product roadmap. While the product strategy outlines the elements of the product and the company's target market, the product roadmap explains how the vision will be executed
Big picture context provides the background of each feature and how it relates to larger goals. It also include details in which certain features will be built, and in what order.
Initiatives are the high-level efforts that help achieve goals. For example, performance improvements and expansion of markets.
Product differentiation occurs when companies have to distinguish a certain product in the marketplace when competing for a product that bring about the same need (e.g. tea) amongst different firms. In order to do so, the aim is to make the product more attractive to the marketplace compared to other competitors. This does not only include price, but also features of the product, quality, packaging, benefits and services. Successful product differentiation creates a comparative advantage for the firm.
As an example, a companies competitor in the market sells Tea A but they sell Tea B, so the company will then have to focus on producing Tea B so that consumers find their product to be more appealing (in terms of price, taste and services) compared to their competitors.
The product life cycle concept consist of 4 stages: introduction, growth, maturity, obsolescence. It outlines the stages the product was first introduced into the market until it is finally removed from the market. The length of the life cycle, duration of each stage and the shape of the curve vary widely for different products. Not all products reach the final stage and some may continue to rise or even fall.
To extend a life of the product, techniques include advertising, price reduction (attract new customers), adding value to the product (new features), explore new markets (selling the product overseas) and new packaging (freshen up old packaging).
Beyond individual-product strategy is platform strategy, where the focus is on multiple products. There are two very different types of platforms: digital platforms in technology, and physical platforms in other fields.
A digital platform is an ecosystem designed to enable different groups to co-create value through “plug-and-play” capabilities. The technology infrastructure of the platform touches customers and developers beyond the firm's boundaries. LinkedIn, Facebook, Google and Amazon—in fact most technology businesses—have platform-based business models.
Physical platforms in other industries refer to product family or product portfolio platforms intended to reduce manufacturing and development costs for new products. In this case a platform is a common architecture, collection of assets, component designs, subsystems, or other elements shared by several products. Given that the components and subsystems have already been debugged and tested, the resulting products should have higher quality. Since platform development occurs less frequently than product development, major platform decisions do not need to be made as often. This has the potential to foster lean product development. However, there are downsides: high upfront costs, risk of platform obsolescence, risk of platform recall affecting numerous products, and potential duplication of effort.