Marketing Management Concept
A strategy, in the general sense, is a clear goal and a long-term action plan that will help you reach the goal. Creating a product strategy involves identifying how the product will help the company achieve its objectives. For instance, if the objective is to boost profits, the strategy will outline the adjustments that must be made and the order in which they must be made to improve the product’s competitiveness and corporate profitability (Marshall & Madhavaram, 2020). The format of the product strategy can be anything, for example, a presentation, a Notion section, or a corporate knowledge base.
A business usually has several main goals, for example, entering new markets, increasing margins, and increasing revenue. The product strategy should assist these objectives. Product managers regularly receive feature requests from other teams. For example, the company decided to focus on user retention.
The product manager should ensure that the development of new or the improvement of existing product features align with this goal (Hunt & Madhavaram, 2020). Should the marketing team recommend including a feature in the product to attract new customers, the proposal will need to wait, as its priorities don’t align with the objective (Marshall & Madhavaram, 2020). The strategy should be clear not only to the product manager but also to the whole company. It includes top management, the product team, and neighboring teams that will participate in project implementation, such as development and marketing.
Practical Application
As an example, an unsuccessful product strategy will be presented to demonstrate the importance and priority of thoughtful planning. The entrepreneur, who later created the successful Letsbar service, decided that the restaurant chain needed to implement digital transformation by adding an online booking function to its website (Borges et al., 2021). At that moment, he and his team had not yet realized what path they had to take.
The first obstacle was that most establishments did not use CRM in principle and kept booking records only on paper. Thus, the team had to create its own CRM for the restaurant business. In addition, they had to develop interactive three-dimensional maps for each restaurant – detailed enough for users to decide where they want to sit (Borges et al., 2021). Finally, they developed the button itself and also integrated the service with their CRM and phone notification functions for booking confirmation.
It took more than a year to create the site, but in the first week, only 4 tables were booked through the online form. Most people continued to use phones out of habit. The business only made $1 per booking, hence the model could only work at a large scale (Borges et al., 2021).
A month later, the entrepreneur and his team decided to analyze the market. Of the nearly 2,000 local restaurants, only about 20 needed pre-booking, and most of their customers were fine with phones (Borges et al., 2021). It took the creators of the service a year to realize that there was no market for it (Borges et al., 2021).
After a while, the entrepreneur discovered an open-source button with the same capabilities, but slightly limited. This meant that considerable time and resources were wasted. This example shows what happens when you do not conduct minimal market research and develop the company’s product strategy before launching a startup.
References
Borges, A. F., Laurindo, F. J., Spínola, M. M., Gonçalves, R. F., & Mattos, C. A. (2021). The strategic use of artificial intelligence in the digital era: Systematic literature review and future research directions. International Journal of Information Management, 57, 1-16.
Hunt, S. D., & Madhavaram, S. (2020). Adaptive marketing capabilities, dynamic capabilities, and renewal competences: The “outside vs. inside” and “static vs. dynamic” controversies in strategy. Industrial Marketing Management, 89, 129-139.
Marshall, G., & Johnston, M. (2023). Marketing management(4th ed.). McGraw-Hill.