A good product strategy has a clear perspective on what customer problem the product is solving. Frequently, people get confused between the user of the product and the customer. The customer is the person paying for your product. The user is the person who will interact with your product. Customers have choices, while users may not have a say in the purchase. Today, we’ll take a look at the differences between the combinations of these groupings and what it means for your product strategy.
The Customer is the User
This situation is oftentimes the most common assumption in product strategy templates and approaches. It assumes the purchaser of the product is also the user of the product. They are the people who have the problem your product is solving. This product could be a piece of software, a car, an appliance, a back-up service, or anything else sold to the consumer. Most often, these are considered Business to Consumer (B2C) products and sales.
For these products, it is important to understand the end-to-end user journey, from need/problem identification, through product selection, purchase, and use. Since the user is also the decision maker and purchaser, the product must directly solve their problem before they will make a purchasing decision.
User influences Customer
Products in this category involve the user informing or convincing the customer that they have the problem your product solves, that they require the problem to be solved, and that your product is the best or preferred solution. Products in this area could be either B2C or B2B (Business to Business), depending on the situation.
This group of products requires understanding both the user journey and the customer journey, and realizing they may be widely different. Knowing the intersection points of these two journeys is essential. If we think about a car purchase for a new driver, the customer may want to minimize cost, while maximizing safety; the user may want a cool looking car. These desires might not always be aligned, so the product strategy must account for divergences and intersections of the two journeys.
Customer influences User
Products that are given to the user or solve a problem not directly experienced by the user are in this group. Examples include enterprise software, machinery, and myriad services. Usually, these products are referred to as B2B.
This group of products likely has multiple user journeys that may not intersect with the customer journey at all. The purchase decision by a customer for a ticketing/tracking solution that must be integrated with the enterprise CRM solution may have little to do with the actual users of the system. If there is only one package that allows the integration, the users will have to learn to love the product. Product strategies in this category should consider life-time costs and pricing, not just immediate pricing and benefits.
Why this matters
Understanding who you are solving a problem for is key to winning with your product and strategy. If you are selling to your user (B2C), they will have in-depth knowledge of their needs and want to know your solution will work for a reasonable price. You’ll have different product placement, marketing, and pricing approaches based on knowing the person deciding to buy is the user.
As a senior leader, any B2C product that does not include a referral to purchase within their user-journey map and marketing plans, may have a big gap in the strategy.
If you are focused on B2B, are there complimentary products or services that are needed, such as training, implementation support, consulting services, etc.? Product strategies that don’t consider these natural compliments, and the sales and support efforts they require, may not be complete.
What about internal “products”?
If your product is not sold externally, if it is a tool your internal stakeholders use, I recommend thinking of the CFO as your customer. They want to know that the cost to produce the tool, or offer the services internally, is being delivered in the most cost-effective manner possible, since it is ultimately a cost-center from a finance perspective.
A successful product strategy
One crucial aspect of a successful product strategy is maintaining a clear focus on the customer. During the review process, ensure that the customer is clearly defined, and that the product’s life cycle addresses their needs, as well as those of the user, particularly if the users are not the direct customers.
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