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Product Management - MK6021 - Part 3

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30 views17 pages

Product Management - MK6021 - Part 3

Uploaded by

aastha1708gupta
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Designing a powerful GTM

for your product


Why is there a need for a Product P&L?

P&L is a key tool for product managers to:


Understand if a product is profitable
Identify areas for cost reduction
Determine the right price for a product
Track performance
Decide where to allocate resources
Make timely decisions
Product Score Card
Product Score Card
A product scorecard is a strategic tool used to evaluate and track the performance of a
product across multiple key dimensions.

Here are the primary elements typically included in a product scorecard:


1. Financial Metrics
Revenue performance: Total revenue, revenue growth rate, and revenue against targets
Profitability: Gross margin, net profit, customer lifetime value (CLV)
Cost metrics: Customer acquisition cost (CAC), development costs, maintenance
expenses
Return on investment (ROI) and break-even analysis

2. Customer Metrics
Customer satisfaction scores (CSAT)
Net Promoter Score (NPS)
Customer retention rate
Churn rate
User engagement metrics (daily/monthly active users)
Product Score Card

3. Product Performance Indicators


Feature adoption rates
Product usage frequency
Performance against product roadmap milestones
Time-to-market for new features
Technical performance (uptime, loading speed, reliability)
User experience (UX) ratings

4. Market Positioning
Market share
Competitive benchmarking
Pricing competitiveness
Market penetration rate
Customer segment analysis
Product Score Card

5. Innovation and Development Metrics


Number of new features developed
Quality of feature releases
Research and development efficiency
Innovation pipeline strength
Technical debt reduction
Improvements in development cycle time

6. Quality and Support Metrics


Number of user-reported bugs
Resolution time for technical issues
Support ticket volume and resolution rate
Product stability indicators
User error rates
Product Score Card

7. Strategic Alignment
Alignment with company vision and goals
Progress towards long-term product strategy
Contribution to overall business objectives
Potential for future growth and expansion

8. Risk Assessment
Potential market risks
Technical vulnerabilities
Compliance and regulatory risks
Competitive threats
Scalability challenges
Product Score Card

9. User Acquisition and Growth


New user registration rates
Conversion rates
User growth trajectory
Referral rates
Channel effectiveness for user acquisition

10. Ecosystem and Integration Metrics


Third-party integrations
API usage and performance
Partner ecosystem health
Platform compatibility
Extensibility of the product
5 Key Pillars of Product GTM
Product positioning - What is the market potential for it now as opposed to what the product
team plans for in their roadmap? Plan for the time and capital expense required in taking the
product to its intended state.

Product messaging - [Product name] is a [product class] for [target market] that [product
purpose]. Unlike [competitor] [product name] has [unique features].

Sales proposition - When evaluating your current sales proposition, take time to audit your
existing or targeted strategic accounts. Does the value proposition align to their needs? How
are the account expectations being managed? What quarterly milestones did the team
establish for the accounts and how are they tracking against those milestones?
5 Key Pillars of Product GTM
Marketing strategy - Look at age, geography, income, title, affiliations
and online behavior to create campaign audiences to test. Leverage
the power of digital media to engage in broadcast and personalised
messaging. Create a clear funnel and track conversion at each stage

Sales strategy - Does it cover the gamut of products you offer? Does it
cover all channels including partner sales channels, digital channels
and traditional channels. Have you phased out your sales plan of
targeting low hanging fruits and then reaching for the stars? Is there
any preferential pricing for existing customers to drive initial adoption
Pricing Models and Revenue Strategy
Pricing Models
Subscription Model:
Customers pay a recurring fee at regular intervals (monthly, annually) to access the product or service.
Provides a predictable revenue stream and fosters customer loyalty through ongoing engagement.
Examples include Netflix, Spotify, and Adobe Creative Cloud.

Freemium Model:
Offers a basic version of the product for free, with limited features or functionality.
Upsells premium features or additional services to monetize a subset of users willing to pay for enhanced value.
Enables user acquisition and market penetration while capturing revenue from a segment of users.
Examples include Dropbox, LinkedIn, and Evernote.

Pay-Per-Use Model:
Customers pay based on their usage or consumption of the product or service.
Ideal for products with variable usage patterns or where customers value flexibility and control over their spending.
Examples include cloud computing services like Amazon Web Services (AWS) and utility services like electricity or
water.
Pricing Models
One-Time Purchase Model:
Customers make a single payment to purchase the product outright, granting
perpetual access or ownership.
Common for standalone software products, consumer electronics, and durable
goods.
Provides immediate revenue but may require ongoing investment in customer
acquisition and retention.
Examples include software licenses, smartphones, and home appliances.

Tiered Pricing Model:


Offers multiple pricing tiers with varying features, functionalities, and price points.
Appeals to different customer segments with diverse needs and budgets,
maximizing revenue potential.
Encourages upselling and cross-selling opportunities as customers grow and their
needs evolve.
Examples include SaaS products like Salesforce, HubSpot, and Slack.
Revenue Strategies
Diversification:
Expand revenue streams by diversifying product offerings, target markets, or distribution channels.
Reduce dependency on a single source of revenue and mitigate risks associated with market fluctuations or disruptions.
Examples include adding complementary products, entering new market segments, or exploring partnerships and alliances.

Customer Retention and Upselling:


Focus on retaining existing customers and maximizing lifetime value through upselling, cross-selling, and renewals.
Offer loyalty programs, discounts, and incentives to encourage repeat purchases and upgrades.
Provide personalized recommendations and tailored offers based on customer behavior and preferences.

Value-Based Pricing:
Align pricing with the perceived value delivered to customers, rather than solely based on costs or competition.
Conduct market research, customer segmentation, and pricing optimization to determine the optimal price points for different
customer segments and use cases.
Continuously monitor market dynamics, customer feedback, and competitive positioning to adjust pricing strategies
accordingly.
Revenue Strategies
Scalability and Efficiency:
Leverage economies of scale, automation, and technology to increase operational
efficiency and reduce costs.
Invest in scalable infrastructure, processes, and systems to support growth without
proportionate increases in resources.
Explore lean methodologies, agile practices, and continuous improvement initiatives to
streamline workflows and maximize productivity.

Customer Acquisition and Expansion:


Invest in marketing, sales, and customer acquisition strategies to attract new customers
and expand market reach.
Develop targeted marketing campaigns, partnerships, and promotional activities to
generate leads and drive conversions.
Optimize customer acquisition channels, track key performance indicators (KPIs), and
iterate on strategies to improve effectiveness and ROI.
Case Study:
Innovative Pricing in Wealth
and Asset Management

BCG Article to Read - Click Here


Business Model Canvas

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