CIO — In most product-driven firms, product planning is one of the highest leverage processes in the whole company. There’s a huge difference in the profitability of a “hit” vs. a me-too product, and a dud is worse than just unprofitable. By its nature, product strategy is as much art as science, but bringing more hard data into the process improves the quality of prioritization decisions.
Product strategy needs to be a mix of engineering/operations plan and market survey, but most market survey techniques are quite vulnerable to big procedural and statistical problems. The iconic bad product of the 1950s was the Edsel, yet it was the result of the most thorough surveying processes of its era.
Fortunately, CRM systems naturally contain information about products, customers, and features. Further, modern CRM systems store a sequence of interactions that make the data support richer inferences about “what’s important to customers.”
The most essential data for product planning is transactional: what products sell where, at what discount level, to whom. While the core of this data may be available from your accounting or order-entry system, the CRM system adds color to the transaction, such as the vertical market, the names and titles of the (likely) users, and the length / complexity of the sales cycle. From this data, you can understand which products tend to be bought together, what are the messages, campaigns or offers that tend to stimulate sales, and which competitive situations are the most favorable. From this, you can infer which feature improvements can help you win more often.
More of the CIO Magazine article from David Taber