Get to Know the Product Strategy Framework
Is your business wasting time and money due to incorrect decision-making during launches or enhancement of a product? These erroneous decisions may arise without a well-defined product strategy framework.
A product strategy framework is a set of guidelines and principles that help companies develop and implement effectively how to make product strategy. It provides a structured approach for defining what a product should be, who it should serve, and how it should be positioned in the market.
There are several different product strategy frameworks available, such as:
- Three Horizons Framework
- The Lean Canvas
- Blue Ocean strategy
- Form, Educate, and Embed (FEE)
- Product Value Proposition canvas
Since you know about the product strategy definition, let’s explore the 5 listed strategies in detail now!
The Best Killer Product Strategy Framework
While there are indeed several similarities between these product launch strategy frameworks, each one offers unique benefits that make them more suitable for specific types of businesses. Let’s delve into the workings of these frameworks and explore the advantages they bring to the table.
1. Three Horizons Framework
The first product strategy framework you should know is the Three Horizons framework. It is a strategic planning framework that helps organizations identify, prioritize, and manage initiatives across three distinct horizons, as mentioned in the following table:
The Three Horizons | |
Horizon 1 | It represents the core business of the organization, which generates the majority of its revenue and profit in the present. It involves managing and optimizing existing products, services, and operations. |
Horizon 2 | It focuses on emerging opportunities that have the potential to become future growth engines for the organization. It involves identifying and investing in new products, services, or markets that complement or build upon the core business. |
Horizon 3 | It represents disruptive or transformational innovations that can potentially create entirely new business models or industries. It involves exploring and experimenting with new ideas, technologies, and markets that may not be directly related to the core business. |
You can use this product management strategy framework to
- Help your business identify and prepare for emerging trends and disruptions
- Facilitate the exploration and development of novel ideas and breakthrough innovations, fostering a culture of innovation and growth.
To implement the Three Horizons framework, you need to:
- Clearly articulate the overall goals and objectives the organization aims to achieve.
- Conduct thorough market research, trend analysis, and internal brainstorming to identify potential initiatives across the three horizons.
- Evaluate each initiative based on its potential impact, risk, alignment with strategic goals, and resource requirements.
- Allocate resources effectively across the three horizons, ensuring adequate support for short-term and long-term initiatives.
2. The Lean Canvas
Another valuable product launch strategy framework is the Lean Canvas. It is a one-page business model template that helps entrepreneurs and startups quickly and easily define and refine their business models. It is based on the Business Model Canvas, but it is simpler and more focused on the key assumptions that drive a business’s success.
The Lean Canvas consists of nine sections, as you can see in this image:
- Focused on customer problems: The Lean Canvas starts with the customer problem, forcing you to focus on solving real problems for real customers. This customer-centric approach is essential for creating successful products.
- Iterative and adaptable: This product growth strategy is designed to be an iterative tool. As you learn more about your customers and their needs, you can use the Lean Canvas to refine your product strategy.
- Validated through experimentation: This product strategy framework encourages you to validate your assumptions through experimentation. This data-driven approach helps you avoid building products that nobody wants.
- Effective for communicating product strategy: The Lean Canvas is an excellent tool for communicating your product strategy to stakeholders. The single-page format makes it easy to share and discuss your plans.
So, how to use Lean Canvas? Here are some steps you should know:
- Gather information: Here are some effective methods to gather this information:
- Customer research (Surveys and interviews, social media analysis, …)
- Market research (Industry reports and publications, online research, attending industry events
- Competitor analysis (Analyze competitor websites and marketing materials, competitive benchmarking,..)
- Start with the problem: The first thing you should do is to define the problem that you are solving for your customers.
- Fill out the rest of the canvas: Once you have defined the problem, you can start filling out the rest of the Lean Canvas. Be sure to keep your answers concise and to the point.
- Get feedback: Once you have filled out the Lean Canvas, get feedback from others on your business model.
- Iterate: Make changes to your business model based on the feedback you receive.
3. Blue Ocean strategy
This is a product strategy framework that aims to create new market space rather than compete in existing markets. Blue Ocean Strategy is a widely recognized and effective product strategy framework for several reasons:
- Focus on innovation and value creation: This strategy focuses on creating innovative products that provide superior value to customers. It does not compete directly with existing offerings. It allows companies to escape intense competition and establish themselves in new, uncontested market spaces.
- Understanding customer value: This product strategy framework encourages companies to deeply understand the needs, desires, and pain points of their customers, not just those served by existing competitors.
- Long-term sustainability: By creating products that are truly unique and valuable to customers, companies can establish a strong market position. This also avoids the pitfalls of price wars and diminishing profit margins.
Developing The Blue Ocean Strategy Is On Your List Yet?
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This valuable product strategy framework can be developed by:
- Eliminating or reducing the importance of factors that drive competition in red oceans. For example, a company might eliminate the need for customers to visit a physical store by developing an online sales platform.
- Creating new value for customers. This could involve developing new items, improving the quality of existing products or services, or providing a more convenient or enjoyable customer experience.
- Reaching new customer segments. This could involve entering new geographical markets, developing products or services for new customer segments, or using new distribution channels.
4. Form, Educate, and Embed (FEE)
If you want a product strategy framework focusing on product-led culture, the Form, Educate, and Embed (FEE) framework is for you. This product strategy framework emphasizes the importance of:
- Forming a clear product vision
- Educating stakeholders
- Embedding the strategy throughout the organization
The three pillars of the FEE framework | |
Form | The product must be easy to use and understand. It must also be designed in a way that is consistent with the customer's expectations. |
Educate | The company must educate its customers about the value of its product. This can be done through various channels, such as marketing campaigns, customer training, and online resources. |
Embeded | The company must integrate its product into the customer's workflow. This can be done by: 1. Developing integrations with other software applications. |
The Form, Educate, and Embed (FEE) product strategy framework is a good approach for several reasons:
- It focuses on the importance of communication and collaboration: The FEE framework emphasizes the importance of communicating the product strategy to key stakeholders and getting their buy-in. This helps to ensure that everyone is aligned on the direction of the product. Simultaneously, the strategy will have the support it needs to succeed.
- It is so clear and focused: The FEE framework provides a clear and focused approach to product strategy development. Breaking the process into three distinct phases it helps ensure that all aspects of product strategy are considered.
To implement this product strategy framework, you should:
- Form:
- Conduct market research to understand customer needs and wants.
- Analyze competitive products to identify opportunities for differentiation.
- Define the product’s vision, mission, and target audience.
- Educate:
- Create a product roadmap that outlines the product’s development plans.
- Develop a messaging and positioning statement that clearly communicates the product’s value proposition.
- Train sales and marketing teams on the product’s features and benefits.
- Embed:
- Integrate the product into the company’s processes and systems.
- Provide ongoing customer support and training.
- Monitor product performance and make adjustments as needed.
5. Four Ps Framework
The marketing mix, also known as the Four Ps framework, is a widely used framework in marketing that helps businesses develop and implement effective product strategies. The framework consists of four key elements, which are product, price, place, and promotion. Take a look at the table below to understand each factor in detail and its benefits for your product strategy process:
Four Ps | Definition | Benefit |
Product | This refers to the actual goods or services that a company offers to its customers. It involves:
| The product that has a clear value proposition and unique selling points can differentiate it from competitors |
Price | This refers to the amount that consumers are willing to pay for a product. Pricing strategies should consider factors such as
| Marketers may adjust the price to create the perception of luxury or exclusivity or to attract more customers |
Place | This refers to the channels and locations through which the product is made available to customers. It involves decisions about where and how the product will be sold. | It ensures that the product is easily accessible to the target market. |
Promotion | This refers to the marketing activities used to communicate the value proposition of the product to the target market. It includes:
| It creates awareness, generates interest, and persuades customers to purchase the product. |
In addition, this product strategy framework is also highly appreciated because it provides a comprehensive view of the marketing process. As a result, it helps to ensure that all aspects of the marketing strategy are aligned.
6. Product Value Proposition canvas
Last but not least product strategy framework you can refer to is the Product Value Proposition canvas. It is a visual tool that helps you understand and communicate the value your product provides to customers. It is a framework that focuses on identifying and addressing customer needs, pains, and gains. The canvas consists of three main components:
- Customer jobs: These are the tasks or problems that customers are trying to solve or the needs they want to satisfy. Customer jobs can be functional, social, or emotional in nature.
- Pains: Pains refer to the negative experiences, obstacles, or risks customers encounter while trying to complete a job. These can include problems they want to avoid or eliminate.
- Gains: Gains are the positive outcomes, benefits, or results that customers aim to achieve by using a product or service.
The Product Value Proposition canvas is a great product strategy framework for several reasons:
- Customer-centric approach: The canvas focuses on understanding and addressing customer needs, pains, and gains. Therefore, you can create products that truly meet customer expectations and provide value.
- Holistic view: As mentioned, the canvas provides a holistic view of the customer journey by considering the functional, social, and emotional aspects of customer jobs. This comprehensive understanding helps businesses design products that cater to the complete customer experience.
- Flexibility: The canvas can be used in various stages of product development, from ideation to refinement.
6 Best Practices to Create A Good Product Strategy Framework
A solid framework not only helps guide your product development efforts but also leads you to have a mastering business growth strategy. To help you create an effective product growth strategy framework, here are seven best practices to consider.
1. Set a bold product mission or vision
Every great product journey begins with a clear and inspiring mission or vision. This guiding statement articulates the purpose of your product, the value it provides to customers, and the impact it aims to make on the world. A compelling mission or vision serves as a beacon for your business. So, how to set a bold product mission or vision before implementing a product growth strategy framework? Here are some key factors you should know:
- Clarity and specificity: You should avoid vague or generic statements. It’s important to clearly define your product’s purpose, value proposition, and target audience.
- Differentiation and uniqueness: You must articulate what makes your product stand out from the competition.
- Customer focus: You need to emphasize the value your product provides to customers. Your vision and mission should address their pain points, aspirations, and unmet needs.
2. Study customer needs and their changes
At the heart of any successful product strategy plan lies a deep understanding of customer needs. Continuously studying customer behavior, preferences, and pain points is essential for ensuring your product remains relevant and valuable. You can utilize various research methods to gain insights into customer needs and expectations, such as
- User interviews
- Surveys
- Focus groups
3. Determine your product’s place in the value chain
Every product occupies a unique position within a complex web of interconnected businesses and processes. Understanding your product’s place in the value chain helps you identify key partners, suppliers, and competitors. You should:
- Analyze the value that your product contributes to the overall value chain
- Identify opportunities to enhance its contribution
4. Analyze growth patterns in other markets
Staying abreast of growth patterns and trends in related markets can provide valuable insights for your own product strategy plan. By understanding the broader industry landscape, you can make informed decisions about your product’s development and positioning. To analyze growth patterns in other markets, you can:
- Study how similar products have evolved
- Identify emerging technologies
- Analyze consumer preferences in other markets
5. Establish KPIs for your strategy
Measuring the success of your product strategy framework requires defining clear and measurable key performance indicators (KPIs). These KPIs should align with your overall business objectives and provide a clear indication of how well your product is performing. To assess the effectiveness of your strategy, you should track metrics such as
- User adoption
- Customer satisfaction
- Market share
- Revenue growth
6. Create a product roadmap
A product roadmap is a visual representation of your product’s development timeline, outlining key milestones and initiatives. It is a communication tool for aligning teams across the organization and ensuring everyone is working towards the same goals. Some tips to consider when creating a product roadmap include:
- Use a product roadmap software tool. There are many popular product roadmap software tools such as Airtable, Aha!, ProductPlan, etc. You have to choose the right tool for your team and your needs.
- Avoid cluttering your roadmap with too much detail. You should focus on the key milestones and initiatives.
- Leverage charts, graphs, and other visuals to illustrate your roadmap.
- Regularly review and update your product roadmap to reflect changes in market conditions and customer needs.
Product Strategy Framework: FAQs
A product marketing strategy framework offers several benefits to businesses, such as: Overall, a well-defined product marketing strategy framework enhances brand visibility, drives sales, and fosters long-term customer loyalty. To generate a good product strategy, you should: Here are some examples of product strategies:
Which Product Strategy Framework is Right for You?
In summary, when deciding on a product strategy framework, there are various options to consider. The most suitable framework for your business will depend on factors such as your specific product, market, and business objectives. Therefore, it is crucial to have a deep understanding of your internal business situation, your customer base, and the performance of your competitors.
Furthermore, if you operate in the eCommerce sector, utilizing an inventory management tool like LitCommerce can greatly enhance your operations, regardless of the product strategy framework you opt for. Feel free to reach out to us for more detailed guidance and advice.
Lastly, remember to stay connected by following our blog and joining our vibrant Facebook community, where you can access a wealth of valuable information and insights about the eCommerce industry.