The PM’s Handbook to Product Development Strategy

In today’s oversaturated markets, finding long-term traction is challenging. Hundreds of startups enter these markets every year, and a lot of them don’t survive. And one of the biggest culprits behind this phenomenon is product: 42% of failed startups released a product that didn’t meet an actual market need.

When so much of your company’s success depends on the product experiences you create, a strong product development strategy is the key to knowing that you’re building something of real value for customers. It gives your team a North Star to follow.

Product development strategy is your way to connect customer needs with business goals and move forward with confidence that you’re building something that makes a positive impact on both. When customers have so many options to choose from, defining your product development strategy ensures that you’re always headed in the right direction as a team.

What Is a Product Development Strategy?

A product development strategy is the blueprint that teams follow when building new products or updating existing ones. It codifies your approach to the product development process and helps each team member execute on their work with autonomy.

Your product development strategy documents the underlying reasoning behind any given project. And it backs up that reasoning with data insights from your customers and your market. As you move through ideation, development, and release, this strategy connects individual tasks back to the value your product will eventually provide to customers.

Let’s say you’re an email marketing company in the process of building out a new ecommerce feature for customers. Your product development strategy

• documents the market research that helped you identify a customer need;
• highlights how the feature will differentiate you from your competitors;
• outlines the amount of work required to complete the project; and
• defines the business metrics you want to impact upon release.

Think about it as the single source of truth for your team as they move through the process of planning, building, testing, and releasing your product to the market.

Why Does a Product Development Strategy Matter?

A well-defined product development strategy helps every member of your team execute on their work with a clear sense of how their contributions move the project forward. It defines the business impact you want to make, backs up the idea with customer data, and highlights the market need for everyone to see. When you launch a new product, your strategy helps everyone involved in the project gain a deeper understanding of the overarching goals.

Product development strategy also helps you define repeatable processes for your team. These processes might include

• daily stand-up meetings to talk through individual tasks and responsibilities;
• biweekly sprint retros to highlight potential bottlenecks and overarching process issues; or
• monthly demos to increase visibility into other’s work accomplishments.

Each meeting has clearly defined goals and helps your team stay motivated and connected with their work and the work of their team. Think about it as a way to build workflows that are efficient and scalable, which always keeps business goals top of mind.

Stand-up meeting via IDoneThis.

Your strategy also makes it easy to validate a product concept — it defines the customer needs or pain points the product or feature will solve, once released. It connects these insights to the overall business value of each product as well. Whenever your team works through a specific task or makes a decision about how to build a specific feature, they can reference the product development strategy to make sure it connects back to your goals.

This strategic approach to product development is the key to building better experiences for customers based on their real-world problems. Connecting each part of the process to business goals and customer insights increases buy-in from the team and gives them a clear road map for success.

How Can You Nail Your Product Development Strategy?

Creating a winning product development strategy requires deep insight into your customers, market, and business needs. To gain this insight, you need to truly understand the current state of the market and how you want to change it. That is only possible when you gather actionable data through rigorous and exhaustive research.

Do Your Homework

Start by conducting market research to identify opportunities in your market. When you understand what’s currently available to your customers and how those products solve their problems, it’s much easier to validate your own product ideas.

Follow this up with competitor analysis to clarify how to position your product upon release. Modern consumers have more options than ever when they want to make a purchase, so you need to nail product messaging and value propositions to make your product stand out.

Taplytics Feature Flag Editor

Leverage Existing Data to Ensure You Meet Customer Needs

Use your existing customer data to understand how your current product services the customer’s needs. Then ask yourself the following questions:

• Are there areas where we can improve the customer experience?
• What kinds of feedback have we received from users?
• Where do customers run into issues using our product?

These questions will help you make sense of the current problems your product solves and identify where improvements are necessary. Your product development strategy needs to include clarity on how every product will affect existing customers as well.

Define Your Success Metrics

Create specific business goals for every release, and connect them to specific metrics. Every product you release needs to make a positive impact on your company in some way, whether it’s an increase to monthly recurring revenue (MRR) or a decrease in customer churn. These goals ensure that you’re not wasting time or effort on the wrong kind of product.

Keep Your Team on Track with a Single Source of Truth

Make sure to document your product strategy clearly, and share it with the team. This increases visibility into your goals and acts as a point of reference whenever anyone has a question. And it helps you gain buy-in from your team and from important stakeholders within the company.

Your product development strategy also acts as a road map to keep your team on track. Building a new product or feature is a long and complex process, so it’s important that you set a clear path forward. This will help you launch products more efficiently and make sure you’re not overtaxing your team.

Help Your Team Solve Real Problems with a Clear Product Development Strategy

Taking a strategic approach to product development helps your team make a real impact on business goals while also solving problems for customers. When everyone involved with a project understands their role in taking a product from idea to release, it’s easy to see the impact of all their hard work and feel engaged with the process. At the end of the day, those deep user insights are what build stronger relationships within your team as well as your customers.