What is Product Strategy? An Easy Introduction in 2 Points (2021)

Product strategy refers to a well-defined plan that’s executed by an organization to accomplish its desired product vision. This strategy is developed by understanding the customer needs, value proposition, the market, and the business goals of the product. To implement this strategy, a product roadmap of typically 12 months is created with timeframes, release goals, features that provide a proper direction for execution.    

Let’s know more about the types and components of a product strategy.

1. What are the types of Product Strategy?    

• Business Strategies
• Competition Priorities
• Competition Advantages

2. What are the components of Product Planning?

• Innovation
• Diversification
• Standardization
• Elimination

1. What Are the Types of Product Strategy?

Let’s understand the product strategy meaning with its different types by classifying them into three categories: Business Strategies, Competition Priorities, and Competition Advantages.

• Business Strategies

1. Product Differentiation

Product differentiation strategy is understood as finding unique points of the product which separates it from its rivals. Under this strategy, the organization attempts to appear unique from its competitors. It might offer better quality, amount, appearance, and more highlights in its item when contrasted with its rivals. It might be more adaptable while managing its clients. 

2. Cost Leadership

Here, the organization attempts to lessen its cost of production. This is finished by delivering the product on a gigantic scope, which provides the organization advantages of economies of enormous scope. The higher the size of creation, the lower will be the expense of creation.

3. Market Segmentation

In this strategy, the organization isolates the market as per its target audience. It offers various items and services to various clients. To accomplish this objective, it delivers and sells the product according to the requirements of the clients. This is called a Focus Strategy, which is a market division methodology.

• Competition Priorities

1. Price

The organization under this strategy sells its item at a low cost. This methodology is utilized when there are similar items in the market. In this situation, the organization will fix a low price, which might encourage the customers to choose your product over your contender’s.

2. Quality

The company’s primary goal should be to create and sell top-notch merchandise and ventures. The costs of such products are generally high. It must redesign the item plan and add new item highlights to fulfill the current needs and requests of its clients. To pick up the market sales, the organization should keenly contribute to making inventive quality items that are liberated from any imperfections.

3. Delivery

Here, the organization should aim to deliver its product to its clients right on time and within a fixed timeframe. The organization’s primary concern is quick delivery of items and providing the fastest availability of products that eliminates the issue of shortage and superfluous deferrals in the market.

4. Product Mix

Under this strategy, the organization creates and sells a product mix. A product mix is a blend of items, which are sold by the same organization. Adopting a product mix could prove advantageous to the organization. But, this strategy is only for big organizations with tremendous production capacity.

5. Service

The organization utilizes assistance to draw in the clients in this technique. It gives better after-deals services, 24×7 support, etc. It might deliver this administration straightforwardly through the organization.

• Competition Advantages

1. Flexible Response

Flexible response technique is supposed to be utilized when an organization rolls out essential improvements in its product designs, that too, as per the developing changes in the market. Here, the significance is given to speed and unwavering quality. That is, the organization must roll out speedy improvements according to the emerging changes in the market request.

2. Low Cost

Under low-cost techniques, the organization battles huge market rivalry by selling its items at significantly lower costs. All the while, it should likewise keep up the nature of its items. An organization can sell its merchandise at least prices on the off chance that it keeps up a minimal effort of production and circulation.

2. What Are the Components of Product Planning?

• Innovation

Development is the reception of a groundbreaking thought, item, or cycle which is tentatively valuable. The possibility of innovation is a lot more extensive than growth. The business conditions are changing so quickly that you must enhance your product. This is one of the critical elements of product strategy.

• Diversification

Product diversification implies that if you have an additional list of products that fall under the umbrella of your category, then your success rate increases with good profitability. For this product strategy example, if you plan to sell toothpaste, and don’t have other dental products like toothbrush, dental floss, mouthwash, etc. to offer, then stability and growth will be challenging to accomplish. That’s why the product line strategy should be thoroughly done.

• Standardization

Product standardization is a way to keep up consistency among the various cycles of a specific decent service that is accessible in multiple business sectors. It is a cycle of promoting a good product with valuable quality, cost, etc. without rolling out any improvements to it. This is one of the critical points in product strategy definition.

• Elimination

Product Elimination is the choice to drop an item from the organization’s portfolio, dependent on its helpless market execution. The market interest for such items has been reduced to none. Hence, production strategy is of great importance.

Conclusion

All in all, while developing a new product strategy, do proper research. This helps you know your real audience as well as the potential ones. Having the wrong customers affects business liquidity. You understand where you are contributing your time and energy just as what worth is it adding to your business. Furthermore, you get a chance to do some huge exploration of your competition.

Most importantly, you get some answers concerning your imperfections and all the while, finding solutions to fix them. The product potential investigation encourages you to become familiar with the market, and after that, the data that you collect will work to your advantage. Once your product strategies in marketing must be concentrated and should meet your business objectives. 

Product Management is a booming field. Its value in the years to come will be exceptional, and for fields of such significance, it is smarter to put efforts into upskilling with programs that are planned and guided by industry specialists, which will give your portfolio a boost.

Jigsaw Academy offers the Product Management Certification, an online 6-month program, in collaboration with the highly reputed IIM Indore. It is India’s first program that conforms to the 5i Framework and offers hands-on learning practice through the Bring Your Own Product (BYOP) feature. 

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