What makes a profitable product/service strategy?

(We’ll refer just to product strategy from here on – but most of the comments work equally well for services also).

A good product strategy can include many parts – more than we can list here. But it must ensure that you get the right product out the door to the right customers; that the product makes money, that your customers buy lots of it, and that your competitors can’t beat it.

The right product strategy could include elements that …

1. Ensure that your product development process makes what customers need, and will absolutely pay for – not just what your engineers think customers need.

2. Produce an excellent ROI directly from product sales. Ideally, product sales should quickly recoup development costs, and then drive strong cash flow from ongoing sales and service

3. Motivate your customer to buy more – either more of the same product, or more products or services in order to gain added benefits. It may also drive your customers to buy different products – (but these would be more of your products, not a competitor’s)

4. Make it easier for customers to stick with you for the long haul, rather than search for alternatives.

5. Help you migrate your customers to one of your newer products when the time has come for them to move on.

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