Trying to navigate the complex world of product development, but are unsure of the difference between a product vision and a product strategy? You're not alone in this. Many product owners struggle to understand the nuances and end up creating their own improvized version of strategic planning.
At Eleken, when we start the work on a design for a new client, we always ask them to share their vision and strategy. These two define a lot in product design, as well as in development, marketing, sales, and so on.
This article explains the importance of having a clear product vision to guide the development of your product, and how a solid product strategy can help you make that vision reality and bring your product to market.
What is product strategy and vision?
Product vision states the future that you aim to create. It describes the purpose of your product, highlighting what problem it solves and whom it serves. If this is too abstract for you and you need a more detailed explanation, read our article about 10 principles of great product vision.
The most common product strategy definition is closely related to the previous term: product strategy is a plan for how to achieve the product vision. It includes the specific goals, objectives, target market, competitive landscape, and positioning of the product.
To put it simple, product vision is where we want to get, while product strategy is how we want to get there.
As we have already written A LOT about product vision in this blog), I’ll focus on product strategy in this article. If you need to refresh your memories about product vision, check out our product vision guide (it includes examples and a template).
Characteristics of a good product strategy
- Customer-focused. It is based on a thorough understanding of the target market and customer needs, and is designed to deliver value to the customer.
- Clear and actionable. It includes a clear value proposition and a plan for achieving the product vision, with specific steps and actions outlined.
- Prioritized. It prioritizes the development of features and capabilities based on their impact and the resources required to develop them.
- Adaptable. It is flexible and able to adapt to changes in the market or customer needs.
- Collaborative. It involves input and buy-in from all relevant stakeholders, including the product team, marketing, sales, and customer support teams.
- Data-Driven. It is based on data and research, such as customer feedback, market trends, and competitive analysis.
- Continuous. It includes a plan for ongoing monitoring and improvement, to ensure the product remains competitive and relevant over time.
Where to start when creating a product strategy?
Strategy is a key element that defines what your team will be doing in the next year or so. That’s what makes it hard to create. To get a starting point, you can follow the advice of Marty Cagan: build a product strategy around a series of product/market fits.
So, how do we get there? A common way of unfolding product strategy is to start with the customer. Who is your product serving? Define the total addressable market (TAM), and figure out how you can reach it. Starting with one segment (user persona, geographical) is the first milestone, then there is the next one, and so on until you cover all the TAM.
It can be just releasing a product on your domestic market and then expanding to other markets. Or, the strategy can be organized to reach different user personas, one after another. For a B2B product, product/market fits can be about different vertical markets.
To shape product strategy, you need to get together all key stakeholders: head of product, head of technology, and head of product marketing. When talking about a small startup, you can unite the whole team to get the best result.
What comes first: vision or strategy?
Product vision usually comes first, as it provides the overarching direction and purpose for the product. A product vision defines the desired future state of the product. This is a statement that guides the team and stakeholders and helps them with understanding the product's direction.
Once the product vision is established, the product strategy can be developed to align with the vision and outline the steps and actions necessary to bring the vision to reality. The product strategy is a plan on how to achieve the product vision, so it should be aligned with the vision in order to be effective.
As both vision and strategy are often developed during the same strategic session time, it’s safe to say that strategy affects the vision. What comes first and which one defines another is not that important. It's the consistency between the two that is crucial.
Difference between product vision and strategy
Whenever you have to explain a concept related to product design, you can always find parallels with a house construction project. So, let’s see where our product vision and product strategy are when we build a house.
Before you lay the foundation, you need a blueprint, a clear picture of what you want the finished product to look like. That blueprint is your product vision. But having a vision alone is not enough to build a great building.
You also need a solid construction plan, a strategy that outlines the steps and materials needed to bring that vision to reality. Think of it as a contractor's plan for building the house.
Without both a blueprint and a plan, your house may never be built or may not be built according to your specifications. In the same way, product vision and product strategy define the process and stability of the construction.
The difference is also in terms: the vision is typically set in 3 to 5 years from now, while the strategy focuses on the plan for 1 to 1,5 years. Product vision is the long-term perspective of what the product should be, while the product strategy is the plan on how to get there in the medium-term.
How different product visions affect product strategies
Now that we won’t confuse product vision with product strategy any more, let’s take a closer look at the dynamics between them. It can be very visible when we take as an example two different visions, a more ambitious one and a less ambitious one. This is how Tim Herbig, a product management consultant, defines them: “low-key” means visions and strategies that stay close to the status quo; “ambitious” are disruptive visions and strategies that change the status quo.
An ambitious product vision could be something like "To revolutionize the transportation industry by creating a fully autonomous, electric vehicle that will reduce carbon emissions and make transportation more accessible and efficient for everyone.”
For a low-key product vision, let’s imagine "To create a mobile app that simplifies grocery shopping by allowing users to create and share shopping lists with their friends and family.”
The ambitious product vision aims to make a big, revolutionary impact on the industry and society, whereas the low-key product vision aims to solve a specific problem for a niche group of users without disrupting the market. Both are important, but the level of ambition and scope of the vision will typically affect the complexity and resources required to achieve it.
For the first one, you would have to start with building a prototype of the vehicle, then starting mass production and reaching the market of people with high income, then find ways to build cheaper models and maybe work with state lobby to promote the project.
For the second one, you would focus on a distinct design, and market it through social media, starting with your country and then spreading it to others, if that is your goal.
These examples give a better understandung of how strategy depends on the dimension of the vision. Of course, it is a very generalized overview, and real product strategies are not written in a couple of sentences, but you get the idea, right?
Golden rules of product vision and product strategy
Now that we have figured out what is the relationship between product vision and product strategy, let’s go through some principles that both of them are based on.
1. Focus on customers rather than the competitors
Product strategy and product vision are strong tools that should help you stay on your own track when you get inclined to do something reliant on what the competitors do.
When you follow the competitors, in the best case, you’ll arrive second. If you follow your own path, you have chances to come first.
2. Focus on the value
Clearly articulate what makes your product unique and why it offers value to customers.
3. Align with company goals
Ensure that your product strategy aligns with the company's overall goals and objectives so that it can create value for both the customer and the company and doesn’t create discrepancies with other departments.
4. Collaborate with cross-functional teams
Work closely with other teams, such as marketing, sales, and customer support, to ensure a cohesive and effective product strategy.
5. Use data to inform decisions
Make data-driven decisions, using research and customer feedback to guide your product strategy.
6. Be flexible and agile
Be prepared to pivot and make changes to your strategy when needed, in response to market and customer demands.
Conclusion
Product vision and strategy are essential for every emerging product. A clear product vision serves as the guiding light, inspiring and aligning the team toward a common goal. A well-defined product strategy provides a plan for execution, ensuring that resources are focused on the most impactful initiatives.
Now that you have the product vision and strategy sorted out, you can look further to the next step: product roadmap. Read our article to learn how to build a functional roadmap for your product.
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