The 3 Stages of Product Evolution for Startup Founders (Part 2)
This is the second part of a 3-part series about the foundations of great product management for start ups.
If you haven’t already — it’s highly recommended to read part 1 for context.
Stage #1 — Value Delivery
Produce Value Before Doing Anything Else
When you start out your company, you should hear a metaphorical “Gong” sound launching you off to a race against the clock to produce value for your target audience. You need to produce some value — any kind of value (relevant to your vision of course) — as soon as you possibly can. This is your top priority as an entrepreneur.
That value is delivered via the crafting of a Strategy.
The importance of a strategy definition including all of its components as described before:
A Strategy is a plan to address a Target Audience solving a Specific Problem for them and providing a clear Value Proposition while having a Strategic Differentiation from a well defined Competition, utilising a Client Acquisition Strategy and Monetisation Strategy attempting to achieve clear KPIs.
is that it requires you to clearly understand who it is you’re serving, what is the problem you are addressing which really concerns them, what’s the value you’re offering and why it’s better than what they have available today.
Nothing can be done without properly delivering the product of one well crafted Strategy; only once you’ve done so (even if it’s not following the ultimate, best and brightest potential strategy) you can have real access to your audience through which you can gain real insights and move forward with serving them effectively.
Until you sell something and achieve an initial reach to a customer base — people with the pain for which you built the product in the first place — it is really very hard to do anything else, so don’t waste your precious resources trying.
Make sure everything you do is aimed specifically at that goal — until it’s reached.
Aim Small, Fail Small
You need to be as clear and as focused as possible; that means — pick the smallest possible problem and/or market segment and/or value proposition you believe you have the ability to effectively serve — and do it. If you fail, choose something else — and if you succeed, expand on it.
A Strategy can fail and then be changed — no problem with that — in fact, it’s expected. On top of that — even once successfully implementing a strategy you may decide you need a better one before moving forward — and that could also be a very wise decision.
MRP, Not MVP
If you haven’t lived under a rock for the duration of this decade, you’ve probably heard of The Lean Startup by Eric Ries and this may sound familiar to you as the practice of developing what Eric coined as an “MVP” (Minimal Viable Product), which I think has now become a cliche. A more relevant term which I only heard recently in a talk by Weebly’s David Rusenko regarding How To Find Product Market Fit is a “Minimal Remarkable Product”, or as David puts it:
“Launch when your product is better than what’s out there”
That is — the point when you start adding real value, is when you do something for someone in a manner which is remarkable compared to what they have available today.
The reason why “Remarkable” is more compelling than “Viable” or even “Valuable” is that it takes into consideration the other available options your client has (i.e — your competition) and really puts an emphasis and what it is that you do different. Your solution might (and probably will) be sub par in many aspects — but as long as it is remarkable in one thing that really matters to someone — you should be able to move it forward.
Don’t Worry, Be Crappy
Thinking the solution needs to be extremely high end to launch is a very common pitfall.
If your solution really solves a problem someone really cares about, elements of it which are — for lack a better word — crappy, should not matter at all, not to you or to the prospects which allegedly really need it. Your primary concern should be to launch as soon as you possibly can, get feedback and move forward.
Choose a Real (and Validated) Pain / Need
Focus on the problem you’re solving, rather than the solution you wish to deliver. Have a personal relationship with a real life person you wish to solve this problem for.
A good rule is that if you can’t find at least one person you have access to who can validate the problem (NOT the viability of the solution) — it’s probably not worth pursuing.
This is probably one of the best (and hardest) things about this stage — it usually requires little to no investment in sales, marketing or business development, since the formation of the strategy you wish to implement must be done based on your understanding of the market and your personal knowledge with your user base — nothing else.
Avoid Using Vanity Metrics
“Fake it ’till you make it” is a very common phrase heard from entrepreneurs, and of course — it does have a lot of merit to it in many contexts. This is not one of them. If you know there’s very little meaning to the amount of installs of your app, or your MAUs — it might be OK to use these stats to impress others — but don’t fool yourself.
If you fool yourself into thinking you’ve actually delivered value, yet you haven’t — you might find yourself in the “Playing house” zone we mentioned earlier sooner than you could realise.
Have real engagement with your users and be sincere — mostly with yourself — regarding how valuable your product is to them.
Realise What You ARE and What You AREN’T Up Against
Another very common pitfall is not realising who your competitors really are at this stage.
The question you need to ask yourself is what are your customers using today, rather than the product you are about to propose. Notice the key word is *today*. Even if you know of a cutting edge solution which is about to hit the market, or even has a small market share — chances are your average prospect is not considering it to be your competition, simply because he’s not aware of it.
Even if it may seem counter intuitive and short sighted — at this stage you’re looking to get your beachhead into the market and gain access to your clients, not realise your technical fantasy and have a differentiated solution no other startup could beat in the future (you’ll have plenty of time to address that issue, don’t worry).
Do NOT (DO NOT!!!) Neglect to Do So
This all may sound really trivial, I know. Yet — the amount of entrepreneurs I meet who evidently don’t constantly ask themselves how much and what kind of value they are actually producing for their clients is staggering.
It might be very tempting to avoid completely fulfilling this step and just dive right into scaling your company. But avoid this temptation at all costs.
Going through the motions of doing a startup — raising money, hiring hotshot programmers, renting offices or attending an acceleration program are cool stuff — but if they’re not founded on a kernel of value, they will not only be much harder to accomplish, but a waste of time, energy and reputation.
Stage #2 — Positioning Effectively
Once you have your initial client base, it’s time for you to position your product properly, in order to get ready to scaling it.
Positioning a product is one of the most significant, yet overlooked, disciplines in the Product Management domain (and perhaps Business Development in general).
Fortunately, not so long ago — one of my favourite product professionals, April Dunford, has published a book (Obviously Awesome) meant to specifically address this issue in a very practical and down-to-earth way — and it does exactly that. I highly recommend it. If you want to get a good idea of what it’s all about — you can read its review and summary by Geoff Roberts.
I will try to give you the digest of what positioning is, why it’s important and the key things to notice when you do it.
So… What is Positioning?
“Positioning is the act of deliberately defining how you are the best at something that a defined market cares a lot about.”
You may ask yourself — how is this different from the Strategy which we spoke about before? The answer explains why it’s simply the natural evolution of it.
When planning and implementing a strategy you manage the image of your product internally while ideally not investing too many resources each time you try to make it work, until you find a successful one. When positioning your product however — your challenge becomes to make everyone — both internal and external to your company (most importantly, your target audience), clearly grasp your product in a way which is preferable to you. This is very different, and far more challenging.
So, <Product Name>, What Do You Want to Be When You Grow Up?
There’s little point in reiterating the components of great positioning as April does a great job of it in the book — and Geoff presents the bullet points in his summary, so I again urge to go a head and read them.
The key point I would like to make about positioning is that it eventually gets you to a point where you know what’s the optimal market frame of reference for your product — that is, what it plans on being when grows up to become the unicorn you dream of. That’s the main addition to the message which strategy does not cover.
It’s crucial to do this purposely, since if you like it or not — your audience is going to do it either way; they’re going to compare you with things they know or have in order to understand why you matter — so you might want to take ownership of this process.
Why is Positioning Important?
When you position your product successfully — it becomes really clear to a very well defined segment of the market what your product is, how it’s better than its alternatives and of course — why should they buy it.
If you want to make your sales process easier, generate more leads with a much higher quality — and make sure you’re working with the right customers that will require much less of your attention in support and will be a much happier and satisfied future referral — positioning in crucial.
Strategise As Much As You Have To — Position Once
The reasons why positioning must only be a concern once you’ve successfully implemented a strategy and started gaining a client base are very clear —
- You can’t position without real feedback from a considerable amount of data points (i.e. — real customers) about your product and what they love about it.
- Positioning costs — setting a whole narrative about your product for your team can be done in a brainstorm meeting, making the market think anything about it (or even hear about it) is not quite so simple.
- Once you’ve positioned your product, changing that position can be quite difficult (if not impossible) and damaging to your brand (even if we ignore the cost mentioned before).
Yet, as with scaling a company, kicking off a positioning campaign (whether you call it that or not) without the proper foundation for it could be very tempting to do for various reasons (your VCs are urging you to build your brand, you feel it would be easier to hire or sell if you do it, etc.) — so make sure you have an authentic foundation for it before you start — and if you don’t, place your focus where it getting one.
In part 3, we go into the final stage — irreplaceability and conclude the series.
