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Many of us talk about ‘product startups’, but what exactly do we mean by a ‘product’? The one that you are developing? OR the one customer wants?
If you are the product marketing manager, what elements will you look to market the product? Do you sell your product like a product (set of features)? Or something else?
Importantly, do customers buy a product? Or do they buy something else?
First, answer this:
Is Gmail a product? Or an email service?
Is Flipkart a product? Or an ecommerce service?
Is redBus a product? Or a bus ticketing service?
If they all are services, where is the product?
Let’s take a step back and ask ‘WHAT exactly is a product? What does it constitute?’ And not from a developer point of view, but from a marketers lens.
Wikipedia defines product as:
In marketing, a product is anything that can be offered to a market that might satisfy a want or need. In retailing, products are called merchandise. In manufacturing, products are purchased as raw materials and sold as finished goods. Commodities are usually raw materials such as metals and agricultural products, but a commodity can also be anything widely available in the open market.
Without getting into pure-play product management part of the definition (MRD vs Client Requirement Document, i.e. building something ‘in the air’ vs. what a client wants you to), let’s talk about specifics of a product from marketers point of view (theoretical, yet fundamental).
Essentially, there are three parts to a product:
1. Core Product
The fundamental question you need to answer is – ‘why do we exist?’. ‘Why would customers buy our product?’. ‘What is the buyer buying? or a user using?’
Core is the “Benefit” of using your product. Answering this ‘core’ question is the first part of your product plan – i.e. why build this? Does it help customers increase their efficiency? For Gmail, it’s the email experience + 1 GB space they offered during launch time that built the core offering.
2. The Actual Product
The real product, the one which customer will actually pay for. This includes not just the product but packaging as well. Actual product is what the customer buys and comes packaged with the product experience.
3. Augmented Product
A few days ago, I went to this coffee outlet in Bangalore for a meeting. The road leading to the coffee shop was too muddy (thanks to the incessant rain) and the muddy road (just before the outlet entrance) made it really difficult for us to enter the outlet.
On being asked why the outlet isn’t doing something about it, the reply was ‘this is not our problem’.
The truth is that it is YOUR problem to ensure that the road leading to your outlet entrance is clean enough for people to come and consume your product, i.e. coffee.
But hold on! The coffee outlet is right. It’s not their problem to solve. But only if customer understands this.
What they missed out was the ‘Augmented elements of the product’.
Augmented elements are essentially the non-physical, the non-core features of the product and exists because of one reason – to ensure that your product experience is brilliant.
In the movie ‘The Social Network’, Mark Zuckerberg makes an interesting point about the availability/uptime of the site and why he considered it as one of the core features, a differentiation:
Okay, let me tell you the difference between Facebook and everyone else, we DON”T CRASH EVER! If those servers are down for even a day, our entire reputation is irreversibly destroyed! Users are fickle, Friendster has proved that. Even a few people leaving would reverberate through the entire userbase. The users are interconnected, that is the whole point. College kids are online because their friends are online, and if one domino goes, the other dominos go, don’t you get that?
Augmented services are the reasons why car manufacturers offer free EMI options, and why ecommerce companies offer CoD and why parking space is part of sales plan for shopping malls.
Long story short, even as you make a product as you think of it, think of it in terms of how and what a customer is buying and using, paying for, or getting fringe delight out of.
That’s your “real product”.
Conclusion: Product OR services?
If you are a product company, the biggest thing you will ever do is to learn how to sell your services that come with soft metrics – like support SLA.
So, to make and sell your product right, sell one.