Product Path to The Future - Do You Have Clarity?

Is your company's growth rate at or below your industry's growth rate?

Is your annual growth rate greater then your industry's growth rate?

How much time do you spend focusing on your products and services?

Are your product/service initiatives focused on increasing your productivity?

Are your product/service initiatives focused on maintaining your current revenue levels or getting you incremental revenue growth?

Are your product/service initiatives focused on outcomes that will grow market share and reach annual growth rates exceeding your industry's growth rate?

Most companies will find 90% of their product/service initiatives are focused on streamlining and improving their margins or maintaining revenue and at best attaining incremental revenue gains. This is especially true as industry and product life cycles reach the maturing stage of development.

The key is to fight the urge to do what everyone else is doing and shift some focus and $$ to product/service initiatives that will help build your market share. When this is done successfully, your rate of growth will exceed that of your industry's growth rate.

Consider where your competitors are focused. How does that compare to where you are focused? Ask yourself the following product/service questions about your competitors and your own company.

1. Is the focus on adding additional features to existing products?
2. Is the focus on finding new ways to bundle/package and price our current products?
3. Are there creative approaches to bundling products/services that are outside our types of products that would motivate prospects to buy our products/services if they were bundled together?
4. Are products/services being offered to address needs of specific customer segments?

As industry and company products/services mature, you will find there is a strong focus on adding additional features to existing products or finding new ways to bundle and price current products/services. 

Shift some of your focus to strategies and initiatives that will find products/services outside your product category that your prospects and customers have a high need for and bundle them with your products. 

Also spend time identifying specific customer segments for your products/services. Get clarity on their unmet needs and how you can offer personalized solutions that specifically meet the segment's needs.

Continually finding ways to differentiate your company's products/services is critical at all times. Even more so when your industry and company products/services have reached the mature phase of the product/service life cycle.

Ensure you have the right product/service strategy systems in place. Your products & services ARE your company. Product planning and development is something that needs to be done on a consistent ongoing basis. Without this, your strategy will default to reacting to your competitors. Get clarity on your product path to the future. Put your competitors in the position of reacting to what you are doing.

 
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Your Price is Too High - How Do You Respond?

When the prospect comments your price is too high, how do you turn this into an advantage instead of allowing it to become an obstacle to the sale?

When the prospect poses this question, it can mean a number of different things:

• Possibly you haven't sold the benefits effectively to make the prospect want your product or service?
• Possibly the prospect is using this as a reason to stall for some reason?
• The prospect is saying, "Show me that it is worth all that money."

How do you work with this objection? Handle it the same way you would address any objection. Use it as a road sign....not a road block.

1. REPHRASE the statement as a question.
2. REPEAT the benefits. Stress the cost effective ones.
3. REDUCE the cost to its lowest factor

When you have the knowledge of your products/services, knowledge of your prospect's business and knowledge of your competitor's products/services, you can more easily handle the comment ... "Your price is too high." You will be better prepared to satisfy the prospects objection that the value they receive from your offerings is well worth any additional cost.

When you reduce the cost to its lowest denominator, the price will seem to shrink.

Be sure you are comparing apples and apples. Determine the complete specs on which the competitor's price is based.

Your product/service is worth your price. Just show your prospect the value from "his perspective" and you will close more sales!

 
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Are Your Products Maturing - What is Next?

Are you facing more and more competition for the products you offer? Is it getting harder to differentiate your company, your brand and your products in comparison to your competitors?

Is pricing becoming more challenging inlight of competitor pricing strategies? Are prices dropping due to competing products? Are your prospects and customers more often questioning your value proposition .. your price?

Do you have a proactive approach for product development and management? How are you positioning your products/services in your markets? Do you find you are reacting to your competition?

Do you have new products in the pipeline or are you finding your efforts are focused on current product feature additions?

Are you searching for how to creatively bundle your products? Are you considering how to bundle the products of other companies in with your products to improve your value proposition and your differentiation?

Consider your current approach to developing & implementing an effective product/service strategy. Is it working for you? Do you need to make some adjustments? Some idea generators are as follows:

1. Identify areas of improvement for current products/services to improve competitive advantage
2. Determine how your products/services have evolved and how they compare to your industry and take the appropriate actions to address the GAPS
3. Ensure you have clarity for  .... who your target customers are.  The segments that are most important to you.....the segments that have the highest potential. Identify the segments you want to ignore.
4. Ensure your product/service packages fit the way your target customers want to buy and are priced at levels they will pay and are acceptable to you. Which of your customer's problems/pain points are you trying to solve? Are there customer unmet needs you are not satisfying? What are your customers willing to pay for? What are they not willing to pay for? Where is demand increasing? Where is demand declining? What switching costs prevent customers from defecting to competitors? Can customers easily find & purchase less expensive products and services?

All products and services will journey through the 4 phases of the product/service life cycle......Introduction....Growth....Maturity....Decline. Often times companies find themselves navigating their way through these phases without a process for effectively managing product/service strategy. 

Your company's products/services ARE YOUR COMPANY. Don't wake up every day reacting to your competition. Develop your own product/service strategy so you can proactively navigate your company towards a balanced product/service portfolio that manages the path for all your products/services through their life cycle.

Get started today. The right product/service strategy processes will provide the foundation for you to make better decisions to ensure competitive advantage in your markets!

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How Do Low Cost Competitors Play the Game

Are you facing low cost competitors in your markets? 

Do you have a good understanding of how they operate? 

Are you exploring adjustments in how you operate in order to compete effectively?

Thinking about your answers to the following questions may help you identify some strategies you should be considering:

1. Are there opportunities for you, or new competitors, to radically change the business model in your industry or in a segment of it?
2. Have you reviewed your value propositions recently? Are they still relevant to your targeted customer segments? Or...... have they become out of date as a result of changes in customer needs and competitive developments?
3. Have you added unnecessary complexity and cost to you business over recent years? Do you have brands, products, product variants (sizes, flavors, colors, grades, etc) in your product suite that no longer meet real customer needs & are not truly valued by customers? Are you providing services that are not needed or valued? Would it make sense to bundle or unbundle some of your offerings so you can offer customers a solution that better fits needs and perhaps reduced the complexity of your business at the same time?
4. Do your marketing communications convey your value proposition effectively or might another approach be more effective?
5. Are you being innovative enough in controlling your costs? Are there ways you could make a "step-change" reduction in your costs? Could you move significant activities to other players in your value chain ...... perhaps even reconfiguring your value chain......who might be able to manage them more efficiently and possibly even more effectively?
6. Could you benefit from being less customer driven? Are you listening too much to your customers .... or to the wrong customers..... and responding too much to their articulated needs that may not be well thought through? Are your customers always right? Should you perhaps try to lead them to new offers, that in the long run may deliver more value and/or lower costs to both of you? If your current customers are not interested, are there other segments of existing users, or potential new users, who might be interested in your new offers?
7. Are you in a business that has very high price elasticity? Should you consider a radical drop in price to stimulate primary demand in your market before a competitor sees this opportunity & gains competitive advantage by doing it?
8. Have you tried to systemically understand your low cost competitor's business systems in real depth? What ideas would you come up with if you set the objective of coming up with 5 to 10 learning points from low cost competitors? Could you significantly improve your competitive position by implementing some of the ideas without threatening your core business model......assuming you still believe you have the right one?

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Strategic Partnerships - Advantages & Disadvantages

The Right Strategic Partnership Means:

• Spreading risk and trusting others to act in joint best interests
• A fit between partners so objectives match and activities show synergy
• Identifying complementary skills, competencies and resources in partners
• Sharing confidential information

Advantages - Strategic Partnerships Can Help An Organization:

• Find an outlet for excess capacity
• Gain quick, low risk access to new markets
• Strengthen its technological base
• Achieve economies of scale through high volume, low cost and mass distribution
• Overcome geographic, legal and trade barriers
• Speed up innovation & new product introduction

Disadvantages - Unsuccessful Partnerships May Result In The Following:

• A lack of strategic fit
• An imbalance in the relationship between the partners
• Implementation problems because of differing leadership styles 
• A lack of trust and confidence
• Slow decision making
• Key requirements for a market project are concentrated in one of the partners

Questions to Ask Yourself Before Creating a Partnership 

1. What changes are effecting our markets?
2. How long will these changes last?
3. How fast can we adapt to these changes?
4. Is investment in our own resource levels the best answer?

 

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Things You Can Do to Grow Your Business

As you consider your alternatives for growing your business to the next level .... the following should be on your list:

• Find New Markets
• Grow New Niches in Your Current Market
• Expand Product Lines
• Provide More Total Solutions to Address Customer Pain Points
• Brand Your Company & People as Thought Leaders

As you focus on the above list, you will will need to consider

• New Product Development
• Strategic Alliances
• Acquisitions or Mergers

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