Product strategy consists of defining the strategy for each product and the trade-offs between the different products. It simultaneously includes a very broad technical dimension (what should be the technical roadmap for each product for the coming years, for example) and a market/competition dimension, all under financial constraints.

For each product, for example, it will be necessary to define which market(s) and which customers it is aimed at, its positioning in relation to the competition, its current technical or non-technical competitive advantages, those that it will need to have in the future, its value proposition, its price, its technical roadmap, what future versions will be offered and when, what investments are necessary, etc. These different elements will generally be found in a ‘product plan’. Trade-offs will take place at each phase of the product’s life cycle, from the initial idea to the end of its life on the market.

For the product portfolio as a whole, it will be necessary to define the overall objectives (e.g. growth and profitability) being pursued, what investments or divestments are needed to achieve them and how they will be financed and allocated to each product. This will depend on the current competitive position of each product, its performance and future prospects, and possible sources of funding. In the future, technical innovations will be added to the current products, services or components, new products will be launched on the market, and others will be withdrawn. The product portfolio strategy is essentially a question of resource allocation because resources are by definition limited and must be balanced between resource-consuming and resource-generating products. For example, you cannot finance the development of too many new products at the same time if you do not have enough profitable products in your product portfolio.

In the B2B/B2G high-tech world, there is no market success without a product strategy with associated technical decisions, because a “bad” product cannot be saved by communication. Product strategy is an essential component of the corporate strategy or the strategy of a particular business. It is so vital that it sometimes takes undue precedence over market strategy when the two should be balanced.

This section explores and illustrates different aspects of product strategy.