2 Case Studies That Showcase The Importance Of Product Strategy

How does a product strategy help?

It's your first line of reference when it comes to prioritization.

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Without a product strategy in place, PMs jump straight to queuing up all the fascinating features & requests on the backlog and then attempting to prioritize them with a framework like RICE, Kano or MoScow.

See more: RICE Scoring Model | Prioritization Method Overview

The challenge is that you'll get some initiatives up there which are equally compelling but will pull you in different directions.

In such scenarios, a product strategy can serve as an effective compass to guide you through those conversations.

Example:

In 2006, Facebook was still in growth mode (< 10 million users).

Chamath Palihapitiya, a senior executive responsible for growth, mentioned that in those early days, they were obsessed with one north star metric that tied directly to accelerated traction:

"Get every user to 7 friends in first 10 days"

In Melissa Perri's product strategy framework, this would be called the "challenge".

Now, let's assume the following opportunities presented themselves:

• Opp 1: Work on a Friend Recommendation engine
• Opp 2: Build a Facebook App marketplace platform

As you know, both initiatives eventually met with great success in Facebook's journey.

However, based on the product strategy at that time, Opp 1 would have taken precedence because it aligns closer with the north star as it directly links up more users.

Opp 2, on the other hand, would also require significant lead time & educational effort as developers got used to the SDKs. (The App platform was consequently launched in 2007 when Facebook's user base was 20 million)

While on paper both seem promising, a product strategy can make the decision a bit easier.

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Another example:

In 2006, Dubizzle was still growing as a classifieds platform. Their initial strategy was to focus efforts in Dubai & maximize the supply side with tons of postings.

Thus, their priority initiatives were aligned with stellar UX & simplified posting experience.

Now, if they were asked to expand to other countries in the region at the time, they'd split their focus from getting a growth engine going based on user-generated content.

Note the initiative itself isn't "bad". Dubizzle eventually scored big when they rolled out to 6 countries in 2010.

However, that play wasn't aligned with their strategy in 2006.

Contrast this with Yallamotor.

When we launched in 2012, our goal was to break into key markets like UAE, Saudi and Egypt from Day 1.

Since we were curating the new car content ourselves & there was verifiable search demand for those keywords, we wanted to cast a wider net starting out.

Now, there was nothing wrong with developing a used car classifieds section (we rolled that out eventually) but as part of the MVP, it would have taken away from our strategy.

Therefore, product strategy creates guardrails of focus on what initiatives to prioritize (not a replacement for prioritization frameworks though).