The software market is constantly evolving. Want proof? In the span of a single week technology website Network World reviews an average of more than 20 software and hardware products. For executives at software development companies, the challenge is one of balance — too many products and you get lost in the noise; too few, and you’re not taking best advantage of your market niche. Here’s a top-level guide to help ensure your product portfolio is in good health.
Many of us in the field of technology product management are so familiar with market segmentation principles that we take them for granted. In fact, I would bet that many of you respond to the topic with a big yawn. So, you might be surprised to learn that we have found that too many product managers don’t go far enough with segmentation to get the results they need to grow their business.
We’ve all seen the analyst reports that estimate that a particular market size is huge and growing. Typically, these markets are defined in lofty and large terms that are perfectly fine for journalists and bloggers to quote in their posts, but inadequate for those of us responsible for making decisions about product features, pricing and go-to-market strategy.
You won’t be alone if you have relied on an analyst’s market definition to frame your target market segment. Frankly, thorough and thoughtful market segmentation requires effort and time. It isn’t a trivial exercise. Even if you believe that your segmentation is as complete as it can be, read on to learn how we suggest you test it just to be certain.
Join me on Pragmatic Live!
Wednesday March 18th at 1:00 PM Eastern
I am deeply passionate about the role of product management and the intrinsic value good product management teams can provide to a company. However, I also have to accept the truth that product mangers as a group are not the game changers, nor the market makers, they could be.
Product Portfolio management is one of those important but not urgent activities that we never seem to have time to do. It is often thought of as an academic exercise; however, good product managers and product team leaders know it should be done, but struggle to organize the effort. If they take the initiative, the activity can unravel very quickly into an over heated debate about which products should be in what quadrant and why.
Product managers often rely too heavily on very narrow views of market input to decide what features are built into a new product or new release. While the usual stakeholders, including executive and existing customers, deserve to be heard, product managers often over correct their input results in product releases that only satisfy a very small group of potential buyers.
Meanwhile, competitors seem to fluidly introduce new products, releases and ideas that gain acceptance immediately with higher adoption targets. It’s not luck.
The competition isn’t inherently smarter and it’s not because its product teams are smaller (or larger). They simply throw away more ideas than they build.
You can do the same with market discovery, a technique that provides a bigger and better pipeline of market problems, new market opportunities and a method to validate them.