Product Concept: 4 Questions You Must Answer Before You’ve Nailed It
Thinking you have a good idea for a new product or feature isn’t the same thing as knowing you do.
Without product concept validation, you run the risk of putting all your resources into something that is doomed from the start. Before you start planning a release, it’s important to understand exactly the type of impact your new feature will have on the market.
Proper vetting for product concepts ensures that your company balances customer needs with the bottom line, and sets your team up for a successful release every time. In this article, we talk through the 4 questions you need to answer to validate your ideas, and provide a framework to help you succeed with your next release.
Have You Written Your Product Concept Statement?
Before we dive into the nitty-gritty, let’s get on the same page about the basics: a product concept is the high-level summary of your idea and how it will provide value, both to the business and to the customers. Think about it as the way you define everything that goes into developing a new product or feature.
Screening product concepts before release is an important part of your product development strategy. If you don’t do this early on, you risk investing time and resources into ideas that could have no real value. Validating your product or feature concept early in the product development lifecycle gives you a chance to reallocate those resources to a more viable concept.
Lack of product concept testing and validation could even be the end of your business: 42% of failed startups released a product or feature that didn’t meet an actual market need.
Your product concept should be codified in a product concept statement. This is how you communicate the idea for your new product or feature across departments—product, design, sales, marketing, etc.—as well as customers and investors.
Once you nail down the type of feature or product you want to develop, it’s time to create a product concept statement. Your product concept statement needs to tell everyone what your idea is and how it will provide value to both your customers and your business.Each member of your team should be able to understand all this at a high level by reading though your product concept statement.
When crafting your product concept statement, give an overview of your idea, your audience, the problem you’re solving, and your business goals. And make sure you revisit your product concept statement often, and adjust as needed. As you do more customer research, you can find new information to flesh out specific areas of your new product or feature so it provides more value to customers.
Here’s an easy-to-reference list of what your product concept statement should cover:
- The product/system/feature name
- Your target users
- How they will use it
- What customer problems it solves
- Which business goals it supports
- It’s unique selling points
- Your vision for the user experience
You’ll reference this product concept statement throughout the product development process, so it’s important to nail down as much specific information as possible.
Does Your Product Concept Meet a Customer Need?
Being a customer-focused organization is important. Rather than building what you think your customers need, listen to what they actually have to say, and then grade and prioritize upcoming product or feature concepts against those insights.
According to Gartner, 89% of companies compete on customer experience (CX). And per the Zendesk Customer Experience Trends Report 2020, around half of customers would opt for a competitor after a single bad experience, and 80% would after multiple poor experiences. So, it’s important to deliver—and to deliver consistently.
According to our survey, product managers solicit feedback before, during, and after the product development process. Customer data from tools like Taplytics gives you the insights you need to refine your new product or feature, so you can judge it against this three-point product concept validation framework:
When you should collect feedback via Taplytics.
Facebook improves its CX through customer feedback. They pull detailed feedback from app marketplaces and run it through clustering algorithms to get concrete insights for product teams. Then they test their feedback-inspired product concepts with Taplytics.
“Products like Taplytics, where you can run a test, learn an answer, and decide whether you want to keep your product in that state or not are super valuable.” — Mike Shaver, former Director of Engineering at Facebook
Vidyard also considers customer feedback when validating product concepts. In fact, customer pain points are prioritized above all else.
“If customers are requesting features or uninstalling your product, you should be looking for where their workflow breaks and what the underlying reason is behind their requests and frustrations. If customers’ opinions and feedback are not involved in the development process, we risk building with strong biases and hard to understand UX. After all, the UX will always be intuitive to the person building it.” — Nicole Zhao, Vidyard
Does Your Product Concept Support Business Goals?
Whenever you release a new feature it has to make an impact on your business’s bottom line. That’s why a good product concept needs to highlight the overall ROI for the company as well as the customer.
Each release you do should be connected to specific and measurable business goals. While your product concept can be successful in its own right, contributing to the larger organization’s bottom lines is always the ultimate goal. If your newly developed feature doesn’t make an impact, your product concept needs some adjusting.
Consider assigning each upcoming release a North Star metric. Amplitude describes this as “the key measure of success for the product team in a company. It defines the relationship between the customer problems that the product team is trying to solve and the revenue that the business aims to generate by doing so.”
North star metrics example via Amplitude.
Here are some examples of potential North Star metrics that can support business goals:
- Monthly recurring revenue (MRR)
- Customer churn
- Customer lifetime value (CLV)
- Average order value (AOV)
- Customer acquisition rate
Is There an Opportunity for Market Penetration?
This is where you round it all out—if your customers and your business goals check out, it’s time to research whether market penetration is viable. If it’s not, you could release a new feature that customers will never get a chance to use.
So, how do you know your product concept is good enough for market penetration?
Market research, and more specifically competitive analysis. You’ll want to gain a thorough understanding of the competitive landscape so you know what you’re up against and whether your new feature stands a chance. Ask:
- What new features have other companies released?
- How are they positioning those features?
- What makes your new feature similar and different?
Also consider surveys, social media conversation, and industry trends as ways to gather market data. Talk to your product team, and really dig into what makes the best products the best. Our survey said:
What makes the best products the best via Taplytics.
To really validate market need, do user testing and phased rollouts with Feature Flags. It’s like using a focus group to test your product concept before releasing it to the greater public. Instead of a single comprehensive rollout, you launch in small, iterative stages that are easy to revert if you need to adjust for any reason.
Winning Product Concepts Lead to Successful Releases
Balancing customer needs, business goals, and viability of market penetration helps product teams take an objective but balanced look when grading product concepts.
Looking at every upcoming feature release and the corresponding product concept statements through this three-point framework helps your team gain a better understanding of their ideas. It’s important that all three statements are true to make sure you nail your releases every time.