When reviewing a product portfolio always start from the perspective of why might customers start buying from you. Typically, a decision to change supplier is driven by one of three reasons; a) their previous supplier let them down or is not delivering solutions, b) you have something new and innovative, or finally c) simply the lowest price.
The four key elements in this product portfolio review are:
1. Understanding your customer needs – What do the customers really want even if they don’t know they need it yet? Spend time talking to both your internal and external sales staff and also talk directly to customers and influencers in the marketplace. Ask the “why” and “what if” questions to test ideas and challenge the accepted norm. Ask customers what their biggest problem or need is and what’s holding them back.
2. Innovation or first to market – What can you develop that’s new for the market, or what can can you bring first to the market place before your competitors. Sometimes you need to take risks, invest and develop the market later. As the pace setter you can define the market parameters and late comers will need to fight to catch up. Put another way, its often better to start off in the broad direction of travel rather than waiting to get the exact final route before starting and being left miles behind!
3. Value and ease of use – In these leaner times, customers have less technical support staff, so ensure ease of set up and use and also consider whole of life competitiveness of your products and how you can deliver value for money to your customers.
4. Finally map your products into the competitive dynamic both now and over a 2/3 year time horizon. From this you can debate and prioritise your own development spend/time to maximise returns, spot quick wins of new products, extra features or rebundling to provide solutions, and for less fruitful gaps consider addressing these by adding distribution of other company’s products or own label branding of their product.