What is a strategy for product development?

A strategy for product development is a comprehensive plan that guides what products to build, for whom, and how they will create value for both customers and the business. Unlike tactical product roadmaps that focus on specific features and timelines, a product development strategy addresses foundational questions about market definition, customer targeting, competitive positioning, and sustainable differentiation.

From a Jobs To Be Done perspective, a product development strategy identifies which customer jobs to address, which needs within those jobs are most underserved, which customer segments struggle most with those needs, and how to create solutions that satisfy those needs better than alternative approaches. This job-centered perspective ensures that product development creates genuine customer value rather than simply adding features or chasing competitors.

Why is a clear strategy essential for product development?

Product development without strategic direction often leads to disappointing results:

1. Resource inefficiency

Without strategic focus, companies spread resources across too many initiatives, resulting in under-resourced projects that fail to achieve market impact.

2. Market confusion

Products developed without clear strategic positioning often struggle to communicate their value proposition, leading to slow adoption and difficult sales cycles.

3. Competitive vulnerability

Without strategic differentiation, products become vulnerable to commoditization and price competition rather than winning on unique value.

4. Organizational misalignment

In the absence of strategic clarity, different functions (engineering, marketing, sales) often work toward different objectives, reducing overall effectiveness.

5. Reactive development patterns

Without strategic guidance, development often becomes reactive—responding to competitor moves, loud customer requests, or internal politics rather than creating sustainable advantage.

What are the key elements of an effective product development strategy?

1. Market Definition Through Jobs To Be Done

The foundation of product strategy is defining the market in terms of customer jobs:

• Identifying the fundamental goal customers are trying to achieve
• Defining the job at the right level of specificity (neither too broad nor too narrow)
• Validating that the job represents a significant and enduring customer need
• Ensuring the job is independent of specific technologies or approaches
• Sizing the market based on willingness to pay to get the job done

This job-based market definition provides a stable strategic foundation even as technologies and solutions evolve.

2. Customer Segmentation Based on Job Struggles

Effective strategy targets specific customer segments defined by their job challenges:

• Mapping the job steps and needs that define the job
• Identifying which needs are most important to different customer groups
• Measuring satisfaction with current solutions for each need
• Discovering patterns of struggle that define potential target segments
• Quantifying the size and value of each segment

This needs-based segmentation reveals opportunities that traditional demographic or firmographic approaches often miss.

3. Competitive Analysis Through Job Satisfaction

Understanding the competitive landscape requires assessing how well alternatives satisfy the job:

• Evaluating competitor performance on key job steps and needs
• Identifying where competitors excel and where they fall short
• Discovering "white space" where no solution adequately addresses important needs
• Recognizing non-obvious competitors that satisfy the same job differently
• Assessing vulnerability to emerging approaches or technologies

This job-based competitive analysis reveals opportunities for meaningful differentiation beyond feature comparisons.

4. Strategic Positioning Around Unmet Needs

Clear strategic positioning requires making explicit choices:

• Selecting specific job steps and needs to address better than alternatives
• Deciding which aspects of the job to de-emphasize or ignore
• Determining how to deliver superior job satisfaction (speed, accuracy, comprehensiveness)
• Choosing the right balance between functional, emotional, and social job dimensions
• Setting appropriate scope boundaries for the solution

These choices create focus and clarity for all subsequent development decisions.

5. Value Capture Mechanisms

Sustainable product strategy requires effective value capture:

• Aligning pricing models with the value created for customers
• Targeting segments with high willingness to pay for job improvement
• Creating switching costs through superior job integration
• Building network effects or data advantages that improve with scale
• Developing ecosystem strategies that enhance job satisfaction over time

These mechanisms ensure that value created translates into sustainable business success.

How do we develop a product development strategy?

1. Conduct job-focused market research

Start with comprehensive research into customer jobs:

• Interview customers about their goals and challenges
• Observe how they currently execute their jobs
• Document pain points, workarounds, and success criteria
• Identify triggers that prompt them to seek new solutions
• Analyze the economic impact of job execution improvements

This research provides the factual foundation for strategic choices.

2. Create and validate a job map

Develop a detailed map of the customer's job:

• Break down the job into 15-20 sequential steps
• Identify 5-10 needs within each step that measure execution quality
• Validate the map through customer feedback
• Ensure the map captures the complete job, not just parts currently addressed by solutions
• Test the map across different customer segments to ensure comprehensiveness

This job map becomes the blueprint for identifying strategic opportunities.

3. Quantify needs and segments

Measure the strategic landscape through quantitative research:

• Survey customers on the importance of each need
• Assess satisfaction with current approaches for each need
• Calculate opportunity scores to identify high-value unmet needs
• Segment customers based on patterns of struggle
• Size segments based on population and willingness to pay

These quantitative insights reveal where the greatest strategic opportunities exist.

4. Develop and evaluate strategic options

Generate multiple potential strategic positions:

• Create alternative target segment options based on unmet needs
• Develop different competitive positioning possibilities
• Evaluate each option for market size, competitive advantage, and feasibility
• Assess organizational fit with each strategic option
• Determine potential growth trajectories for each option

This options-based approach prevents premature commitment to a suboptimal strategy.

5. Make explicit strategic choices

Select and document clear strategic decisions:

• Define the target customer segment with specific job struggles
• Select the job steps and needs to address better than alternatives
• Articulate the approach to creating superior job satisfaction
• Determine which aspects of the job to de-emphasize
• Set clear boundaries for what the solution will and won't do

These explicit choices create clarity and alignment for development efforts.

6. Align the organization around the strategy

Ensure the strategy guides all aspects of development:

• Communicate the strategy in job-centric terms across functions
• Train teams on the customer job and strategic positioning
• Develop metrics that track progress toward strategic objectives
• Create decision frameworks that maintain strategic alignment
• Implement governance processes that prevent strategic drift

This alignment ensures the strategy translates into coordinated action.

What are the key questions a product development strategy should answer?

1. Customer and Job Questions

• Which customers are we targeting, and what job are they hiring our product to do?
• Which job steps and needs matter most to these customers?
• How do different customer segments struggle with the job differently?
• What triggers customers to seek new solutions for this job?
• What metrics do customers use to evaluate success in this job?

2. Market Opportunity Questions

• How large is the target market defined by this job?
• What is customers' willingness to pay to get this job done better?
• Which segments have the highest opportunity scores (importance minus satisfaction)?
• What share of the market do we need to capture to meet our growth objectives?
• How is this market likely to evolve over our strategic timeframe?

3. Competitive Position Questions

• How do current solutions perform on key job steps and needs?
• Where are competitors most vulnerable in job satisfaction?
• What unique advantages can we bring to satisfying this job?
• Which aspects of the job should we address differently from competitors?
• What barriers might prevent competitors from copying our approach?

4. Solution Approach Questions

• What core capabilities do we need to satisfy key job steps?
• How will our solution fundamentally improve job execution?
• What technology approach best supports our job satisfaction goals?
• What partnerships or ecosystem strategies enhance job satisfaction?
• What is our approach to evolving the solution as the job changes?

5. Business Model Questions

• How will we capture value from the job satisfaction we create?
• Which pricing model best aligns with customer value perception?
• What go-to-market approach reaches our target segments efficiently?
• How will we create sustainable differentiation over time?
• What financial outcomes do we expect from this strategy?

What are common pitfalls in product development strategy?

Feature-first thinking

Many strategies focus on product features rather than customer jobs, leading to solutions that don't address fundamental customer needs. Effective strategies start with the job customers need to accomplish, not the features to build.

Competitive imitation

Without a job-based perspective, companies often define strategy reactively based on competitor features. This leads to commoditization rather than meaningful differentiation based on superior job satisfaction.

Market definition myopia

Defining markets too narrowly based on current solutions limits strategic options. Job-based market definitions reveal broader opportunities and potential disruption threats that product-centric definitions miss.

False consensus on customer needs

Many organizations assume they understand customer needs without adequate research, leading to strategies based on internal assumptions rather than customer realities. Rigorous job research is essential for effective strategy.

Failure to make trade-offs

Attempting to satisfy all customer needs equally results in mediocre solutions that excel at nothing. Effective strategies require explicit choices about which needs to prioritize and which to de-emphasize.

Insufficient strategic specificity

Vague strategies that don't make clear choices fail to provide meaningful guidance for development decisions. Specificity about target segments, priority needs, and competitive positioning is essential.

How do we measure the effectiveness of a product development strategy?

Strategic Alignment Metrics

These measure how well development activities align with strategic intent:

• Strategy comprehension - Percentage of team members who can articulate the strategy correctly
• Roadmap alignment - Percentage of roadmap items directly supporting strategic priorities
• Resource allocation - Proportion of resources dedicated to strategic initiatives
• Strategic consistency - Stability of strategic direction over time
• Decision alignment - Percentage of development decisions consistent with strategy

Strong performance on these metrics indicates effective strategy implementation.

Market Validation Metrics

These reveal whether the strategic choices resonate in the market:

• Target segment traction - Adoption rates among strategically targeted customers
• Need satisfaction improvement - Measured increases in customer satisfaction with priority needs
• Competitive win rate - Success in competitive situations against key alternatives
• Value capture effectiveness - Ability to monetize at levels aligned with strategy
• Customer job success - Improvements in how well customers execute their job

These metrics validate that strategic choices address real market opportunities.

Business Impact Metrics

Ultimately, strategy effectiveness is reflected in business results:

• Growth rate - Revenue growth compared to market and competitors
• Margin profile - Ability to maintain target margins despite competitive pressure
• Customer acquisition efficiency - Cost to acquire customers relative to lifetime value
• Retention and expansion - Ability to retain customers and expand relationships
• Valuation impact - Effect on company valuation multiples relative to peers

These metrics connect strategic choices to shareholder value creation.

Adaptability Indicators

Effective strategies also enable appropriate adaptation:

• Learning rate - How quickly the organization identifies and addresses strategic gaps
• Experiment velocity - Speed of testing strategic assumptions and alternatives
• Strategic option value - Maintenance of viable alternative strategies
• Competitive response time - Ability to adjust to competitive moves while maintaining strategic coherence
• Emerging opportunity identification - Success in spotting new strategic options before competitors

These indicators reflect the dynamic capabilities needed for sustained strategic success.

How thrv helps develop effective product development strategies

thrv provides specialized methodologies and tools to help companies develop and implement effective product development strategies centered on customer jobs and unmet needs. The thrv platform enables teams to:

1. Map customer jobs and identify underserved needs through qualitative and quantitative research
2. Segment customers based on patterns of struggle rather than demographic characteristics
3. Analyze competitive solutions through the lens of job satisfaction
4. Develop strategic options based on opportunity scores and segment analysis
5. Create clear strategic positioning around specific unmet needs
6. Align product roadmaps with strategic priorities
7. Measure strategy effectiveness through job satisfaction improvements

For product organizations struggling with weak differentiation, slow growth, or low adoption, thrv's approach provides a clear path to more effective product development based on a deeper understanding of customer jobs and needs. The result is stronger market positioning, more efficient development, and sustainable competitive advantages—all derived from helping customers make meaningful progress in their most important jobs.