Product Discovery: To be or not to be
The other day, a fellow product enthusiast asked me about the holy grail of the product: “When do you know, you have got a product?” I probed further to understand the context. That’s where the plot thickens. Apparently, they have a Product Pipeline meeting where the colleagues pitched different ideas to be pursued. In one such meeting, he heard two very different approaches - One was a rising demand for a certain feature in the target market. While, the Other was an excellent feature that could be fleshed out. He rephrased the question, “What should be pursued?”
I answered, Neither.
You can start with a customer problem/ market need, provided it is big enough to be pursued with initial product investment (There you go, my dear ‘Business Case’). And, figure out if you have a technology solution to solve this problem? You can have figured out a customer need through Fake Door Tests like DoorDash. Now, you need to build a technology solution around it.
You can go other way round where you have created something cool but you don’t know what it is yet. But, you need to find your customer for it. e.g. You have created something cool like Google Search or Facebook. But, you don’t know what’s the market potential of it. You are testing the waters. (see the video below).
At the end of the day, you can begin from either direction but you got to have both. You have your product only when you have the product-market-enduser fit. You can watch the below conversation, specifically from the 1 minute 30 second mark.
The two contexts, shared above, give us an idea that how relevant is the above question. Also, it’s relevance is irrespective of the size of the firm i.e. for a mature product organization, a Unicorn or a start-up. So, how do you arrive at Product-Market — EndUser fit? There are three dimensions of this fit (the geek in me is tempted to say 3C2)
Product/Market Fit: Is it Real?
Does the product solve a pertinent problem for a large enough set of customers? Is it worth investing the firm’s resources in exploring this problem.
Product/Business Fit: Is it worth the hassle?
Will the customers pay for the product? Will it generate enough returns for our initial investments?
Both the above questions fall in the domain of writing a Business Case. Having determined the Market Size (fit 1), we need to ascertain if customer would pay for it (fit 2)?
Product/Company Fit: Is it in our Wheelhouse?
Does the product fall within the range of capabilities that we as an organization have? Does it also differentiate us from the competition?
The above question can have a range of answers from a strait jacket to a wide range of options, depending on the size of organization. If you are just exploring the opportunity, you as a Start-up might say - Why not? While you could be as big as Amazon and launch with Blue Origin. You could be in the messy middle where you are already invested in a product. Now, every opportunity comes with an Entry and Exit Barrier (see end notes).
While exploring the answers to the above trifecta, we need to consider one more factor — Product Ecosystem. After the launch, the above product would operate in a connected world. A good analogy to consider would be Apple Eco-system. Everything they create, it blends within their eco-system. This factor could have small to large considerations. A minor consideration would be — if you are launching a simple portal, you need to ensure that users can register and authenticate themselves with their Google Log-in. The large consideration could be — If you are launching an EV, you need to think about the Charging Stations.
As you would have imagined, that Product Discovery is a full time job that is often very intensive and high stakes responsibility that can shape the trajectory of your organization. Talking about Big Shoes. In the next few articles, I intend to explore the techniques to Product Discovery. Stay Tuned :)
Next article on one of the most crucial techniques can be found here.
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End Notes: Now, I have stressed on the word exploring a couple of times, above. Because, it is what is. Reaching the Product-Market-EndUser Fit, it is not a one-shot effort i.e. You start from a hypothesis and iteratively, reach to the answers to the above questions.
The above also indicate that is resource intensive. Hence, I also indicate towards the definition of Entry Barrier as the concept in Economics - It is a fixed cost that must be incurred by a new entrant to the market, regardless of production or sales activities, that incumbents do not have or have not had to incur.
Similarly; you cannot walk away from what you are already invested in, because of hard and soft factors. The hard factors can be — you might have already achieved ‘Economies of Scale’. The soft factors can be — you might have already established relationships with your partners that takes years to build. Hence, they contribute to your Exit Barriers.
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About me: Seasoned Product Manager / Student working at the intersection of business growth, technical knowledge and design principles with 11+ years of experience of working in Tech Industry enabling ‘Digital Transformation and Organization Change’. Feel free to connect with me on LinkedIn
