Want to craft a winning product strategy? You need quality data insights.

Crafting an unbeatable product strategy is no walk in the park.

In the race to make an impact, many product teams fall prey to prioritizing quantity over quality. Unfortunately, this approach leads to stretched resources, team burnout, and compromised value.

So, what makes a product strategy shine?

According to Melissa Perri, CEO of Product Institute, the answer lies in the data. By utilizing the right data, you gain valuable insights into what's working well, what isn't, and what to prioritize.

The build trap 

When companies hit the fast track to growth, it's all sunshine and rainbows on the product side. But what if that trajectory takes an unexpected nosedive?

For many, the knee-jerk reaction is to churn out every new feature requested by their customer base. After all, what better way to grow your business than by delivering exactly what your customers ask for?

Here's where the problem lies. It’s the dreaded "build trap," as Melissa puts it. The build trap is the cycle teams fall into, where they create an overload of unnecessary and often meaningless features. It's all about building for the sake of building. It’s when teams focus on the quantity of what's produced, rather than the outcomes of the features and products themselves.

The result?

1. Too many features and functions that nobody knows how to use

2. Burnt-out teams juggling too many initiatives at once

3. Unhappy customers who feel let down by the level of value provided

In our recent webinar, Melissa outlines how to steer clear of the dreaded build trap. We’ve captured some of her thoughts here.

The power of product strategy

A product strategy is not a wish list of features. It's a decision-making framework that drives action and aligns with your organization's goals. 

In the webinar, Melissa Perri lays out an ideal multi-layered product strategy:

1. Start with the Company Vision: Begin by understanding the company's long-term goals set by the CEO and senior leadership.

2. Identify Strategic Intents: Determine the business challenges that stand in the way of your company's vision. This should involve input from the entire C-suite.

3. Establish Combined Goals: Collaboratively set goals for the entire organization, not just department or team-level goals. This helps ensure alignment on your strategic intents.

4. Define Product Initiatives: Analyze the product vision to identify what problems your product can address. Prioritize opportunities that deliver the most value for your customers. 

5. Explore Options: Consider various ways to solve the identified problems, evaluating different solutions and approaches.

6. Gather Data: Obtain relevant data, including customer acquisition costs, churn rates, growth rates, ARR, and product costs, to set strategic intents and prioritize goals.

7. Set Time-Bound Objectives: Time-bound objectives, usually spanning two to three years, focus the entire organization's efforts on specific priorities.

8. Utilize Customer Insights: Leverage qualitative insights from customers to inform the development of features and address their needs effectively.

By following this approach you can build the most effective product strategy that drives the most impact.

The role of data

Data insights are the backbone of value and growth. They unveil the mysteries of customer behavior, solve problems, and fuel unparalleled growth.

As Melissa explains, if you want to craft an impactful product strategy, you need to strike a balance between early assessment and meaningful results. While it's essential to track relevant metrics right away, some changes need more time before they can be considered effective. Set time-bound metrics and consistently monitor progress.

To effectively track success, consider adopting the following metrics and frameworks:

• OKRs: Align your goals and track progress by defining clear objectives and measurable key results.

• Customer-centric metrics: Focus on metrics that directly relate to satisfaction and success. These include retention, engagement, and Net Promoter Score (NPS).

• Product-specific metrics: Assess the performance and impact of your product with metrics like usage, conversion rate, and revenue generated.

• Leading and lagging indicators: Evaluate the effectiveness of your strategy by combining leading indicators (e.g., adoption rates, usage patterns) and lagging indicators (e.g., revenue, retention).

• Experimentation and A/B testing: Conduct controlled experiments to test new features or changes. This allows you to measure impact on desired outcomes.

Conclusion 

As Melissa explains, creating a winning product strategy requires a strong product culture and informed decision-making. Steer clear of the build trap, prioritize quality over quantity, and watch as your organization's product culture flourishes. These strategic moves will propel your products to triumphant success in the ever-evolving market landscape.