Earlier this month, Battery Ventures and the Tel Aviv Microsoft Accelerator, an acceleration program working with later-stage startups, co-hosted a workshop for a group of 20 product managers. Though these executives have multiple job responsibilities and goals, the workshop focused on two key proficiencies: Executing a solid go-to-market strategy and formulating a pricing strategy.
According to Baruch Deutsch, a former hi-tech marketing executive, now a consultant, mentor and speaker, both of these goals map back to the same, fundamental, understanding: Product managers must speak with and know their users! This has to happen from day one and continue as managers test their product concept with future clients, work to improve retention and frequency-of-use rates, and choose the best pricing method for their product.
The workshop included an exhaustive review of issues related to business models and pricing but also group exercises dealing with actual problems the PMs are facing in their companies. This group brainstorming–coupled with Deutsch’s feedback and insights–helped attendees understand and evaluate various revenue models, from software licenses to subscriptions to ad-based models; how to create a basic income statement; churn and customer-acquisition costs; and more.
A good PM will help align his or her company with the market. Often, a company’s business goals and what users actually want and expect to get from its product don’t necessarily align. For example: Most of us don’t want to see ads when we’re using an app or a service online. But what if monetization is only possible through ads? Figuring out whether users can tolerate ads, or other types of pricing plans they may not initially want, is an art a good PM needs to master—and sometimes has more to do with psychology than business, Deutsch said.
Deutsch also noted that PMs need to learn how to partner with different sales channels, when each of those channels, from inside sales to selling through strategic partners, has their own quirks.
As far as go-to-market topics, the workshop covered establishing sales channels, mastering demand generation, how to nurture leads and how to approach CRM, among other topics. Deutsch stressed that early on, PMs can’t and shouldn’t delegate customer acquisition solely to sales. A PM needs to be involved, particularly in terms of communicating the company’s value proposition, fine-tuning positioning and testing pricing. Finally, after sales start coming in, PMs need to be positioned to handle customer crises.
The bottom line: Product managers have a complex job, but with the right mix of customer insights, data and gut feel, they can make products successful in the market.