Product Offering Order of Magnitude
Chris Sita and David Kim
Product Offering 1
Why Talk About This?
Don’t get lost in the details.
• Take a look at where your offering fits in
• Take a look at adjacent possibilities
• This is a companion presentation to Craft of Business
Product Offering 2
10x Analysis
Was popularized by Andy Grove of Intel – as ways of thinking about disruptive technology. Used by Pine and Gilmore in Experience Economy to illustrate the value of experience-based offerings.
Product Offering 3
Source: http://www.service-innovation.org/
Extract -> A commodity -> make it into -> A good -> customize it into -> A service/experience
10x: Apply to PM Fast Track
Example: Apply the analysis to PM Fast Track, an on-line and meetup community for product managers.
At each point, what creates the 10x steps?
Product Offering 4
10x: Quantity and Price To generate $1M in revenues Note that online channel magically solves a portion of the quantity relationship, if you have a repeatable product.
Product Offering 5
Offering Price Quantity Revenues
Meetup event (commodity) $ 10 100,000 $ 1,000,000
Day workshop (service) $ 100 10,000 $ 1,000,000
Conference (experience) $ 1,000 1,000 $ 1,000,000
Education (transform) $ 10,000 100 $ 1,000,000
Exercise: What Can You Offer?
Product Offering 6
• If you had to pick one thing you’d like to teach someone (or build for someone), what would it be? This is your product.
• Who would you first teach it to? Who would be your first customer?
• How much would he or she pay for your product?
Ideas a la Ramit
• Ramit has a cool 2x2 to chart possibilities
• It need not be an educational product
• But, low cost and high profit would be good
• Make sure it’s you, though – what can you do and for whom?
Product Offering 7
Source: www.iwillteachyoutoberich.com
Test Fast a la Tim Ferriss
• Watch this video of Tim Ferriss interviewing Noah Kagan.
• One (of many) key insight is you should give yourself a constraint of time. If you didn’t have a year to test your idea – if you had to validate it by tomorrow, by tonight, within the hour, what would you do???
• http://youtu.be/v47WEyeSMSA
Product Offering 8
Test Cheap a la Noah Kagan
• You don’t want to spend a lot of money, don’t worry about hiring designers or scaling. Just go out and see if there is a market.
• Noah Kagan talks about how he built the multi-million dollar AppSumo for $50:
• http://www.appsumo.com/how-appsumo-was-built-for-50/
Product Offering 9
Test Right a la Amy Hoy
• Amy Hoy, product guru, talks about going on a sales safari. The point is to get inside the head of the customer.
• Click the link to watch her video: • http://unicornfree.com/2013/video-sales-safari-in-action
Product Offering 10
Take a Long-Term View
• Remember the craft?
• Start small, dream big
• Time is your friend, not your enemy
Product Offering 11
Img source: Wikipedia
Chartres Cathedral – North Rose Window
How is Time Your Friend?
• It does not mean be slow (test fast, remember)?
• If you take a craft-based view, then there is an accelerating return on your investment, not diminishing returns.
• Beethoven’s music later in his life was far better than it was in his youth.
Product Offering 12
Img source: Wikimedia
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Product Offering 13
Chris Sita David Kim @findinbay dklounge.github.io