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I love great products. Few things are more enjoyable to work on than creating something of your own and putting it out into the world. But it takes time to get a product right, and there are many traps to fall into.
My product journey began with understanding the difference between selling value vs selling time. To me, that is key to scaling sales and revenue without burning out.
The next most important concept is iteration. At the start, your product can feel messy or disjointed. But if you focus on the process, you will soon have your very own 'assembly line' for creating value. It doesn't happen overnight, but I promise you that if you commit to the journey, you will get off the hamster wheel and have more time for what you love.
Now, let's release the pressure valve. Take a breath. You do not need to know all the answers right now. All you need to do is absorb the principles below, and the ideas will come in due course. Give it time.
A Healthy Product Strategy Makes All The Difference
There is a massive difference between starting a company (or side hustle) with a product strategy and one without. A solid product strategy helps you create a unique product expression and is the differentiator between those who make money effortlessly and those who carry impossible burdens. Your partner will feel the difference, as will your family and your clients. If done right, the investment you make in your product strategy upfront will generate returns for many years to come.
What is Productization?
Productization is the process of transforming an idea into a repeatable method for selling and delivering value.
Let's illustrate this with an example.
About 10 years ago, a friend (let's call her Violet) charged $200 per hour for performance marketing services and managed 5 clients. She did this for a year or so before reaching a point of exhaustion, with each client needing something different and each of them having unlimited access to her.
Then, Violet decided to productize. She developed a business performance diagnostic framework, charging $25,000 per diagnostic. She serviced e-commerce companies, financial services firms, and consumer goods companies. Things were going well, but she knew the biggest opportunity was in e-commerce.
Violet decided to productize further by selling exclusively to Series B, e-commerce companies. Each sale included a diagnostic, a customized marketing strategy, an account manager, and a revenue growth guarantee of $25,000 per month.
It paid off.
Violet found that VC-backed e-commerce companies sought massive revenue growth and were eager to engage with her. The concentrated time she spent in e-commerce allowed her to become a true expert in the field and accumulate a strong network of supporters.
Today, Violet is building a new performance marketing software, with packages starting at $250,000 per year.
The lesson: productization is a journey and where you start is not where you end.
Why Should You Productize?
If productization sounds like a lot of work, you're right. But the benefits are substantial.
It enhances efficiency, streamlines selling, marketing, and referrals, simplifies hiring, and fosters insights that can lead to new opportunities. Additionally, it eases growing pains and maximizes your potential gains.
Since consulting is often the first pillar of a portfolio career, I'll use it as an example and break the productization journey into three phases: Basic, Phased and Advanced.
Note: While this example focuses on consulting, the thought process can be applied just as much to any other product or service you have in mind.
Basic Consulting Services
This is where most people start and includes a somewhat random collection of service offerings, such as training, workshops, advisory, or scoped deliverables. At this stage, services are often tailored to each client individually, which is time-consuming and less efficient. This is essentially your starting place.
Phased Consulting Services
In this next phase, deliverables are sequenced into a structured "front end" and "back end." The front end typically consists of a diagnostic to establish trust and team chemistry. The back end is informed by the findings from the front end, allowing for a more targeted approach to subsequent engagements. This structure is a powerful growth enabler and ensures that the services provided are more strategic and impactful.
Advanced Consulting Services
The advanced approach to consulting services starts with a diagnostic and then offers packages tailored to different client segments. Typically, this includes a startup package and an enterprise package, each with distinct pricing and responsibilities. This method not only standardizes the consulting process but also allows for scalability and more predictable revenue streams.
The 4-Part Framework to Productize
Step 1 → Choosing Your Domain
Finding the right focus for productization begins with identifying the intersection of your skills, interests, and market opportunities. This intersection is your sweet spot, where you can minimize friction and maximize effectiveness. For example, if you have expertise in digital marketing and a passion for helping small businesses, you might focus on creating marketing solutions tailored to that market segment.
I typically recommend avoiding products or services that you have no experience. Instead, start with what you know and iteratively refine your focus based on objective feedback. For instance, if you have a background in software development, launching a tech-related product or service will leverage your existing skills and knowledge. Gather feedback from early users to fine-tune your offering and ensure it meets market demands.
By aligning your focus with your strengths and market needs, you can create a more effective and sustainable product. For example, if you are skilled in data analysis and see a growing demand for data-driven decision-making in your industry, you might develop a product that helps businesses harness their data for strategic insights. This approach allows you to build on your expertise while addressing real market needs.
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Step 2 → Market/Product Discovery
Once you have identified your chosen domain, the next step is to understand the "opportunity space." This involves researching trends, shifts in demand, and changes in buyer behavior. For example, if you're in the tech industry, you might notice a growing trend towards AI and automation. Investigating how companies are adopting these technologies and the challenges they face can help you identify opportunities.
Engage with industry experts and peers to gather insights. Initiate conversations with people you admire in the field, as these discussions can provide invaluable perspectives. For instance, attending conferences, participating in webinars, or joining professional networks can help you connect with thought leaders and gain a deeper understanding of the market. These interactions can reveal emerging trends and unmet needs that your skills can address.
Additionally, consider how budgets (personal or professional) are allocated for your particular product or service. This means looking at where individuals, families or companies are investing their money and which segments are experiencing high growth. For example, if you see increased spending in renewable energy, it indicates a rising demand for sustainable solutions. By understanding these dynamics, you can pinpoint where your skills can meet emerging needs and position yourself effectively in the market.
Step 3 → Solution Area Selection
The next step is to identify the specific problems you are passionate about solving and ensure your solutions are consistent and repeatable. Start by clearly defining the problems you aim to address. For instance, if you offer digital marketing services, you might focus on helping small businesses enhance their online presence. Research how others address these problems, including their methods and pricing, to differentiate your offerings. If most agencies provide generic solutions, you could specialize in tailored strategies for niche markets like local businesses.
Clearly define your solutions by outlining problem definitions, buyer dynamics, scope, and unique value propositions (UVP). For example, if the problem is "small businesses struggle with content creation," your solution might involve tailored content marketing strategies, including blog posts, social media updates, and email newsletters. Understand buyer dynamics by considering who your ideal customers are, what motivates them, and how they make purchasing decisions. Small business owners might seek affordable, easy-to-implement solutions that deliver quick results.
Outline the scope of your solutions, detailing what is included and what is not. Transparency helps manage customer expectations and build trust. Highlight your UVP, emphasizing the benefits and advantages of your solutions. For instance, "We provide personalized digital marketing strategies that drive measurable results within 90 days, backed by a team of experts with a proven track record." By following these steps, you can ensure your solutions are effective and stand out in the market, helping you build a loyal customer base.
Step 4 → Launch & Iterate
Once your product is defined, it is crucial to join relevant groups and communities to gather feedback. Engaging with these networks will provide you with real-world insights that can help you refine your product. For example, if you have developed a new project management tool, joining forums and attending meetups for project managers can offer invaluable perspectives on usability and feature preferences. Similarly, participating in industry-specific LinkedIn groups or online communities can help you understand the needs and pain points of your target audience.
By interacting with potential users and peers, you can identify any gaps or areas for improvement in your product. This feedback loop is essential for making adjustments that enhance the product's value and functionality. For instance, if you receive feedback that users find a particular feature cumbersome, you can work on simplifying it. Alternatively, if users express a desire for additional capabilities, you can prioritize these in your development roadmap.
Continuously testing and evolving your product is key to ensuring it remains relevant and effective. Implementing a beta testing phase where select users can trial the product and provide feedback can be particularly beneficial. This iterative process allows you to make data-driven decisions and stay ahead of market trends.
These productization patterns have worked for me and for those I've seen evolve. However, it’s important to understand that each business context is unique. By grasping the nuances of your specific situation and applying these principles sensibly, you can transform your consulting services into scalable products that drive efficiency, profitability, and growth. Embrace the journey, commit to continuous improvement, and watch as your business and portfolio evolves into a streamlined, high-performing operation.