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Product policy largely determines the company’s position in the market. A well-thought-out product portfolio that takes into account the needs of the target audience is able to ensure the efficiency and profitability of the company. This is what the product profile management does.
It allows for a systematic approach that includes comprehensive strategy development. There is no place for spontaneous and formulaic decisions. Each step is driven by data from analysis and research. If something worked in one company, it is not at all a fact that it will benefit your business. Therefore, it is important to operate well with theoretical knowledge and apply it within a specific brand. In this article, we will look at these aspects.
Features of the product strategy
A product is everything tangible and intangible that can benefit and satisfy consumers. This includes goods and services. When working on a product strategy, it is necessary to clearly understand the difference between these concepts and their specifics.
If everything is clear enough with the goods, then the question of services may raise questions. After all, this is something that cannot be touched or looked at before purchasing. Thus, the client can only feel its value after being provided.
Services are often associated directly with the person providing them. This demonstrates the importance of working on a personal brand. In addition, the material component of the service can influence the choice of consumers. For example, the premises, technology, equipment and other elements involved in its delivery.
Every detail is important here, including a competent communication strategy. You have to give the impression of being an expert in order to gain consumer trust. For example, even grammatical mistakes can negatively affect your reputation. Use tools like Grammarly to avoid typos. This will help build a positive image and become part of an effective product portfolio strategy.
Challenges faced by companies
The product portfolio can be of different sizes and vary depending on the company and target market. It can consist of a single product, a product line, or even a combination of lines.
While a product portfolio is very important, it cannot guarantee success. Therefore, this issue must be approached as thoughtfully as possible. Only a thorough analysis of the needs of the target audience and the market can provide this.
This is where companies face a volatile environment. The oversaturation of the market, constantly changing consumer preferences, force companies to approach the development of a product portfolio more and more carefully.
According to research, more than 30,000 new consumer products are released annually, and 95% of them end in failure.
A systematic approach, analysis and timely research can minimize risks and reduce the likelihood of failure of new products. By skipping this stage, companies may face unforeseen problems.
Having a plan that includes a strategy that takes into account different development scenarios can increase the likelihood of success for new products.
The Role of Marketing in Product Strategy
The role of marketing in developing a product portfolio cannot be underestimated. After all, he accompanies her at almost every stage. Without competent marketing, companies cannot get the desired result and predict efficiency.
Marketing research is a powerful tool that allows you to determine the needs of consumers, make an assessment of the market, and understand what positions competitors are in. They can be carried out before creating a strategy, to test a new product and its impact on the company’s success, as well as to make changes in activities in time.
For example, consider the types of research and how they can be applied in practice:
- Focus groups. This is a common marketing research method in which a company brings together a group of people to discuss. The moderator asks questions, while the members of the group have the opportunity to offer their options and put forward opinions. The key in the focus group is to define the sample of respondents. They must be united by certain characteristics. This can be age, profession, habits, etc. The method is excellent at the stage of creating or testing a product.
- Polls and questionnaires. The method is characterized by versatility, since it can be used to solve a wide variety of problems. It can act in the form of questionnaires, service quality maps, etc. Suitable for preliminary market research, determining customer satisfaction, and obtaining information on improvement.
- Observation. It includes two methods of conducting – with or without interaction with the subject of observation. The research evaluates and measures the behavior of consumers participating in it.
- Experiments and testing. The method involves testing using variables. Can be carried out in a controlled or uncontrolled environment. A great example is creating multiple pages of variations of the same page on a site. Suppose we have a portfolio website builder and need to test 2 hypotheses. The experimenters observe and analyze each of them. After that, the most effective option is chosen.
You might also be interested in: Product Management Skills: User Research
Each product has technical specifications. The marketing challenge is to clearly define them for a new product. The specification is based on information about consumer needs obtained through research. What properties should the new product have, what functionality and practical application it will receive. All this is described in the corresponding document and gives a clear idea of what the market wants.
Positioning, although it is a consequence of the previous two stages, it plays a decisive role. With it, the business packages the product in the form in which the consumer wants to see it.
Positioning can be applied to a product, a company, a brand-specific product portfolio. This is how you present any of the listed target audience, what emotions you are trying to evoke, what promise you make to your consumers.
Product portfolio strategy is critical to a company’s success. It includes much more than just an assortment. To succeed in the market, companies must approach its creation systematically and take into account the needs of the market. In addition, the strategy should be periodically changed based on the changes that have occurred in the market.
Meet the Author
Stacey Wonder is a motivated professional with experience in project management, risk management, and project planning. She has experience as a management consultant, technical writer, and organizational process analyst. Stacey regularly writes about the latest advancements in technology and the digital industry.