(8 minute read)

Digital Products are becoming increasingly important. They transform our everyday lives in many ways and offer enormous benefits for both customers and businesses alike, while also posing significant challenges.

The growing importance of Digital Products even in businesses outside of the tech sector, is generating a rising demand for Digital Product Management professionals.

Digital Product Management

Digital Product Management is a form of thinking, a way of problem-solution visualisation. It is often referred to as ABCD thinking – Analytics, Business Model, Coordination, and Design Thinking. It is a hugely popular and growing field, requiring managers to possess complex skill sets to manage a product across its entire lifecycle, from ideation, creation, and development to delivery, implementation, analytics, and monetisation. In addition, managers need to demonstrate business skills, commercial awareness, and soft skills like team working, communication, coordination, and time management.

Business Model

Successful digital products depend on accurate understanding of customer needs, preferences, and behaviours as well as clear identification of business needs that can be fulfilled efficiently. To ensure that digital products meet both customer and business expectations, product managers require good business and marketing skills, and strategic business thinking.

Digital Products also need to be thought through carefully for their financial implications. Some digital products can be introduced with a clear commercial goal – e.g. apps for purchase (direct) or apps for in-app purchase (indirect) where the app itself is free to download but can ‘push’ for more products to purchase – whereas some other products will have a financial payoff in other ways – e.g. introducing an online, self-service interface option which will reduce resources and costs involved in providing a face-to-face customer service option. Some products will also have non-commercial goals, i.e. (a sign-up self-registration account format, or creating a blog or infographic for download).

Monetising a digital product and generating value out of it is critical for a business. Monetisation calculation will include costs and breakeven pay per use, predictive usage (against test development costs) and cost-savings and cost efficiencies effected by using the Minimum Viable Product (MVP) to replace more resource-intensive options (e.g. chatbot function in app to replace call centres or phone lines). This in turn will drive more complex decisions on pricing and bundling including pricing tier structures, dynamic pricing, up-selling pathways, and upgrade lifecycles.

Modern businesses are also part of complex ecosystems where products are seen as simply one value-delivering mechanism amidst an entire ecosystem of connected products and services. In this context, product managers must be able to oversee not only the Application Programming Interface as a product in its own right but also be able to manage key stakeholder relationships (e.g. payment merchants, affiliates, developers, data sharing partnerships etc.) within the ecosystem, as the ecosystem itself grows and evolves.

Design and Development

Digital Product Management presents challenges for design and development. As IT becomes more consumer-driven, design takes centre stage in providing a seamless customer experience. Product managers must possess intimate knowledge of customer needs, by building stronger, personal, and connected relationships with customers through channel engagement, customer feedback, and research. A thorough knowledge of how customers experience products and services will help product managers quickly develop, test, and iterate MVPs, incorporating customer insights and feedback into testing, development, and iteration. Digital product development is increasingly done by cross-functional teams that cut across organisational silos and bring together design, analytics, and marketing skills in order to increase scale and speed. Product managers who possess cross-functional insights and strong coordination skills can be invaluable in developing quick, cost efficient product solutions. 

Data and Analytics

Businesses increasingly have access to vast volumes of internal and external data which drives strategy and informs product decision making. Managers with good data handling skills will be able to extract actionable insights from data to inform product development while also using analytics to measure product success. Data metrics such as customer engagement, conversion, retention, lifetime value etc. will enable tracking product success. Everyday decisions made by product managers will affect and in turn be affected by analytics and will underline the success of product and business strategy.

Mini CEOs

The range of skills and abilities outlined above, makes Digital Product Managers thought of as mini-CEOs, responsible for their own product domain. What types of Digital Product Managers are there? Do they possess different competencies and characteristics?

If you want to learn more about Digital Product Managers and their skill sets, read this post here…