Early Stage Product Development

How to think about defining product scope, features and focus. Making simple products vs complex ones, and the jobs that products do.

Added a section on strategy and aggregation theory.

Credit to Intercom and thanks to Des Traynor and Intercom for the permission to share.

Transcript

1. @rilinho Early Stage Product Development
3. Proper Credit Attribution Much of this presentation comes from: Des Traynor Intercom https://blog.intercom.io http://businessofsoftware.org/2014/12/prod uct-strategy-saying-part-2-des-traynor-bos- usa-2014/ (great example of good content marketing)
4. Why are you building a product?
5. Product Service Value Clients Value ($) Business
6. Your product is distributing value For Clients, not for the founders
7. Things will get confusing over time • Founder’s Vision for product • What did the competitors just do? • What did the last customer ask for? • What did this mentor think? • What do we need for a partnership? • What do other people on the team want? • What does the press say about us? • What does this study say about our sector? • What do our biggest clients want to pay for? Source (and more info) : Des Traynor (Intercom) https://vimeo.com/122401355
8. Lower costs for startups + Faster Development Cycles + Bigger (Mobile) Market Way More Startups Way More Competition Consequences: • Pitch needs to be Focused • Product needs to be Focused • Lean Startup Culture • Emerging Entrep Ecosystems = Remember our context
9. Managing a Product Dealing with “Tension”
10. Gall’s Law states that all complex systems that work evolved from simpler systems that worked. If you want to build a complex system that works, build a simpler system first, and then improve it over time. Simple Complex Time
11. Complex Taking a look at a complex product • How to pitch? • Hard to adopt • Resource intensive to make Source (and more info) : Des Traynor (Intercom) http://businessofsoftware.org/2014/12/product-strategy-saying-part-2-des-traynor-bos-usa-2014/
12. Simple • Easier to explain • Easier to adopt • Easier to make Do one simple thing, and do it well Source (and more info) : Des Traynor (Intercom) http://businessofsoftware.org/2014/12/product-strategy-saying-part-2-des-traynor-bos-usa-2014/
13. Building Early Stage Products • Finding simple solutions to real problems • Easy to build, test and refine • Easy to explain to potential customers • Easy to adopt for potential customers Explanation Adoption Do they understand it? Is this the right audience? Is this valuable? Are they actually using it? Does it fit their process? Source (and more info) : Des Traynor (Intercom) http://businessofsoftware.org/2014/12/product-strategy-saying-part-2-des-traynor-bos-usa-2014/
14. Making a Simple Product Team is Paid I Have to Pay My Team Check Bank Find Money Check Timesheets Verify Rates Tell Team Draft Payslips Issue Transfers
15. Making a Simple Product End Process Start Process Complex Product Simple Product Where does your product start and stop?
16. When a customer uses your product End Process Start Process Your Product Change in user behavior ----- - Big Risk for the User (Incentives?) - Requires a lot of NEW Value - Easy Transition with Process
17. When a customer uses your product End Process Start Process Your Product Let the user back home ----- - Your product did it’s job - User is happy - Transition them back
18. When a customer uses your product End Process Start Process Your Product Reasons to leave steps out ----- - Competing with a larger company - Many ways to achieve step - Dilution / More maintenance
19. Selection Process for Incubadora Sinergia We Need to Select Companies Companies Selected Make Questions Build Form Manage Applicants 1st Filter Interview Selected 2nd Filter Communicate with Applicants Communicate Selection Process Get Press Selection Committee Customer Relationship Manager Marketing So Many Ways to do This So Many Ways to do This
20. Takeaways • Get to know your user ◦ What is their real incentive? What is their process? ◦ More interviews, no surveys • Identify the starting / ending point for your value • Make it super easy for users to get in and out • Identify and eliminate meaningless steps • Get simple → Product value is easily marginalized ◦ “A Swiss Army knife still has a knife” → but for what job? • Is there a cost to not being focused enough? (YES)
21. But… Features are so cool Myths in making products
22. What Feature Creep Looks Like
23. • Forget about the “myths” that we learned from Microsoft, Apple, and pretty much any big company ◦ They built products and took advantage of a world where distribution costed A LOT of money (moat) --> they could afford to build features and experiment • Startups today compete in a new context where distribution costs are going to zero ◦ You are competing with niche, international businesses • There is a HUGE risk in trying to do too much... That world has completely changed
24. Distribution of Value by Features Value Features A feature can be valuable for a user or client, but does it make your business more defensible?
30. Extra features tend to • Snowball ◦ Have to fulfill expectations with clients / users ◦ Have to maintain, update and dedicate resources • Dilute the core value of your product → harder to explain, adopt • Create more opportunities for competitors • Take you off focus ◦ New product ideas come from everywhere • Have a long term impact on the scalability of your business
31. Breaking features down How Often? How Many People Use the Feature?
32. Plotting features Few of the People Straight Copy: Des Traynor (Intercom) https://blog.intercom.io/before-you-plan-your-product-roadmap/ Some of the People Most of the People All of the People All of the Time Most of the Time Some of the Time Very Little of the Time Doing two things at the same time
33. Challenges for Latam Startups Launch Early Adopters Local Market (Breakeven) Decide Status Quo Talk to that other local client or partner Bigger Markets Likely Road to Services or Consulting Different Sectors → Features → New Sales Cycles → More people? Growth Opportunities → Higher Valuation / ROI, but, it’s hard. Cross Border → Do you know the other market? → New regulation, processes, culture, etc. → More risk Already profitable → Great! Risk of too much “localization”... and if you want: - More Growth? Go bigger market - More Money? Go into services All of these options require about the same amount of work
34. Takeaways • Know what kind of company you want to build ◦ Realize there are subtle consequences for many decisions you will take soon • Know your users ◦ Their context, processes, motivations, before / after • Defensible businesses ◦ Big → Simple product, niche focus, internet to scale, 1:10 ◦ Local → Local sales, customization, customer service, 1:1 • Know that the competition will likely do what they have incentives to do
35. Staying the Course Products & Jobs
36. Get to the bottom of it Straight Copy: Des Traynor (Intercom) https://blog.intercom.io/before-you-plan-your-product-roadmap/
37. Focus on “Jobs to be Done” • What is your product doing for your client? • Forget about categories or sectors ◦ Jobs cross all of them ◦ Give away your strategy and product value • Products match problems, not people • Jobs are bigger than markets • Who else (in the world) needs this job done? Source: Des Traynor (Intercom) http://businessofsoftware.org/2014/12/product-strategy-saying-part-2-des-traynor-bos-usa-2014/
38. “The customer rarely buys what the company thinks it’s selling” - Peter Drucker Source: https://blog.intercom.io/shareable-map/ Feature: Map of Users Job: Vanity Piece
39. Where would “making an interactive video” it on this? Generate Sales Start Process
40. Get a package from A to B with conidence, certainty and speed. Package Arrives Need to Send Package https://blog.intercom.com/when-personas-fail-you/
41. Keep everyone up to date on a project they’re involved with. Team Is Updated Need to Update Team https://blog.intercom.com/when-personas-fail-you/
42. Get me face to face with my colleague who is in San Francisco. Had Meeting Need a Meeting https://blog.intercom.com/when-personas-fail-you/
43. • Capture this moment privately for me and her, so we can (hopefully) look back on it fondly in years to come • Embarrass my friend in front of her friends, cause she’ll regret this in the morning. • Get this file backed up online, so I can point others to it. • Get a copy of this photo to my grandmother who doesn’t use computers. • Make this look cool and interesting. Like me. And then share it. • Get this edited and into my portfolio so that people consider hiring me for future engagements. The Jobs a Photograph Does...
44. So, what are the jobs you need to get done?
45. Find The Users that Love You Amount of Users → Amount of Love →
46. Learn to Say “NO” YES YES YES YES NO NO NO NO NO NO NO NO NO YES? If you say yes, do you have a vision? YES
47. Macrotrends Aggregation Theory
48. It is costing less and less money to distribute products and services This terrifies traditional industries
49. Defending through distribution • Local Regulation ◦ Permission to operate, approval of certain groups • Cost Structures ◦ Need a lot of money or capital to compete • Supplier Relationships ◦ Having the weight to negotiate the best margins • Local Coverage ◦ Being the only local option • Trust
50. The Basic Parts Suppliers Distributors Clients
51. Typical Way of Building Businesses Suppliers Distributors Clients Lock these together Charge Higher Prices With Clients
52. Movie Rentals Suppliers Distributors Clients HollyWood Movie Producers DVD Rental Stores “I Want to see a Movie” Making DVDs
53. Newspapers Suppliers Distributors Clients Editors Journalists Printing Presses Delivery “Whats the News”
54. Taxis Suppliers Distributors Clients Drivers Cars Dispatchers “I Need Transportation” Taxi Fleet Mgmt
55. Banks Suppliers Distributors Clients Savings Services Money Management Branches Brokers Investments “I Need to Invest / Save Money”
56. Retail Suppliers Distributors Clients Specialty Items Groceries Shopping Malls Supermarkets Consumer Packaged Goods “I Need Stuff”
57. The Internet Has Changed Distribution Suppliers Distributors Clients Can’t Lock These Anymore Users Can Now Pick
58. Clients connecting with Distribution Suppliers Distribution Clients Some of the Most Successful Companies today are doing this
59. New Strategies for the Internet World Suppliers Distribution Clients Platforms focused on retaining clients Adding Big Value / Customer Service User Interface / UX
60. When Distribution Goes to Zero • Traditional businesses that depend on it will be forced to innovate (on UX / service), or lose business • No barriers to entry for possible competitors ◦ This will affect your startup directly - you are competing with international offers even in your local market • Force you to understand global players and trends • You can use the same playbook to solve big problems and have larger impacts regionally or globally
61. ¡Gracias! @rilinho @paorapetti