2020-07-09
Using Growth frameworks to Drive Product & Market Development
So you've launched your product, you've achieved some pretty good initial sales, and you've got a wealth of data from customers about how well your product suits them–but what's next?
Developing products based on learnings from data is a core facet of any effective growth strategy, though it's often difficult to decide which customer requests to incorporate into your product development pipeline. This is where frameworks come in. We've outlined some of our favourites below.
Going back to basics: the Ansoff Matrix
First thought up in 1957, the Ansoff Matrix will probably take you back to Introduction to Marketing classes, but its relevance hasn't declined over time. The concept is straightforward: you can choose to develop either your product or your market, but it's wisest to avoid trying to do both at the same time.
Choosing to drive penetration within your existing audience is the least risky option for driving growth, but it's also liable to suffer from diminishing returns as time goes on. Eventually, it'll make more sense to look beyond your initial market to prevent hitting a wall. There are two directions you can choose to take:
- Bring current products to new markets & audiences
- Create new products for your current markets & audiences
Bringing your product to new audiences using market development strategies is all about the top of the funnel. Taking learnings from existing performance and data is hugely important, as is ensuring research into the new market is appropriately in-depth. When selecting a new audience, you need to keep in mind:
- Is the new market large enough to be profitable?
- How will messaging and branding need to be modified, and what will this cost?
- What personas sit within this new market, and how are they best reached?
A new market could be another country or group of countries, another demographic, or a combination of both. You're far more likely to succeed if the new market is similar to current markets, and if your product is novel–that is, you're offering something that's not currently available.
Many fall into the trap of trying to create new markets, but it really doesn't need to be immensely complicated. Take a DTC e-commerce brand, for example: offering shipping options to a new country and including this market within your media strategy would be enough to drive growth and satisfy these criteria.
That said, there are several inherent risks. If you're offering a product with low differentiation and high competition, you may be best to investigate new products for your existing markets rather than trying to compete as a new player in an unknown landscape that's already cornered.
Will you have the First-Mover Advantage (FMA)?
When looking to new markets, keep FMA in mind. The first person to achieve a significant share of any marketplace, new or old, is the most likely to succeed. There are some exceptions, but of the most successful companies, the vast majority of cornered markets early and grew before there was significant competition. That said, not all open markets are opportunities; the lack of a market for winter wear in tropical countries most likely isn't down to entrepreneurial oversight...
FMA is most commonly seen with new technology, with companies like Uber, Amazon and Google having numerous instances of success from being the first to offer new and novel technology and services to customers. That's not to say these are the only types of companies who benefit from this advantage; wherever resources are controlled first, there is a higher likelihood of growth and success.
This advantage may not relate to specific, tangible tasks. A company that provides perceived value that no competitor does–even if the like-services are available–can still have FMA. Consider Monday.com's latest marketing effort. There are a whole wealth of project management tools available that do arguably the same job, but Monday.com's current campaign around 'decision fakers' sells the ability to be a better boss, rather than a task management system.
Consider Jobs to be Done (JTBD)
Jobs to be Done is a fantastic way of thinking about your products and services from the perspective of your customers, and it can help to quickly identify areas for product development which will best benefit your audience.
Whatever you're selling, JTBD encourages you to take a step back and think not of your product in isolation, but of how it enables your customers to enhance and evolve themselves.
There are clear examples of this in action across multiple sectors, but one of the best instances of this framework being taken to its extreme is the fragrance market. Perfumiers rarely talk about the specifics of their fragrances, instead, they focus on what it enables its wearer to do: exude confidence, attract partners, or... do whatever this is. Individually, these are as valid as any other motivation to buy a product.
At its core, then, JTBD is about providing tools to enable customers to achieve desired change. Sometimes these changes are simple, though more often than not they're intangible and non-specific.
Jobs within this framework are distinct from tasks. A task–organising photos–is not a Job to be Done. Tasks form part of Customer Jobs, but they aren't inherently Jobs to be Done. Instead, a JTBD is a description of an improved version of the customer–being a more organised, better photographer.
This framework is brilliant for adjusting messaging strategies and starting to think about how products and services can be enhanced to hit these notes more effectively, and there's a fantastic outline of the framework by Alan Klement over at JTBD.info if you're keen to investigate it in more detail.
If you're starting to think about the next step for your business, particularly if you're looking to scale up, you should really give our guide for scaleups a read–we've included our five key recommendations to help overcome challenges that commonly face business trying to break through and grow.
