Product or playground — which bet would you make?
Product bets are not easy to assess — it is estimated $35 billion is bet each year on unused products or features; however, there are some great processes and tools that you can use to improve the odds and increase return on investment.
At Productbox, a product innovation studio, we guide our clients on how to make these difficult bets all the time. We try and think about product bets using an investment strategy called Dollar Cost Averaging (DCA). DCA divides up the total amount to be invested, with purchases occurring at regular intervals to reduce the impact of volatility. So what are some processes and tools we use to help improve the odds?
A product bets toolkit
1. Dashboard: Similar to the stock price chart, news, and blogs you constantly check, where is your 360 degree view of the product? Productboard is an amazing tool to feed all your data into, so you can view qualitative data and quantitative data in one place to determine where you are going to place a bet, and if your bet is working.
2. Research: In our line of work to understand customer needs and desired outcomes, we use jobs to be done qualitative interviews. The important and unsatisfied desired outcomes can be recorded as objectives in Productboard to ensure that features and/or product ideas are aligned with with the most important outcomes.
3. Live data test: To have high confidence in the results of our user testing we use live data prototypes built on Bubble to create a fully functional product fast and without significant investment. The qualitative feedback from users is fed directly into the inbox on Productboard, so it can be tagged against specific segments, users, ideas and and/or objectives. (freehugo.com is just one example of this work.)
4. Quantitative data: We use Mixpanel, which integrates with both Bubble and Productboard, to gather quantitative data related to specific cohorts. These cohorts can be brought into Productboard as segments, so you understand which bets are trending.
5. Prioritization: Whether you are a small business or a large enterprise, you can use formulas to consistently make smaller, more frequent bets, to improve your odds of success. We’ve found so much success with dedicated prioritization frameworks, that we have started to leverage them beyond the digital product work in our day jobs.
Applying product frameworks to real life bets
A few years ago we raised some money to build a playground in a little place called Pallai in the North of Sri Lanka. We saw this as an opportunity to build the playground like we build products — with a dedicated prioritization framework. The stakes were high, and we wanted to be sure our bet would pay off with great impact. Our vision was to create a gathering space for 400 smiling children and their families.
In the playground’s instance we used the RICE framework to pretty quickly decide whether to make the bet or not:
- Reach: Close proximity to a school and large villages
- Impact: Central, happy place for 400 kids to develop motor skills and parents to gather and feel supported
- Confidence: No similar playground in the area and locals who were supportive and invested in its success
- Effort: Land that was resistant to floods and easy to build on
Now at Productbox when we need to make a big bet on products and features, we ask ourselves: Should we build a product or playground? How confident are we of the impact this new product is going to have? We use dashboards, research, validation, qualitative data, and prioritization to confidently make smart bets.
When we are unable to come to consensus, we ask ourselves: Are we better off investing in another playground and helping 400 underprivileged kids where we know we will deliver value? This enables us to us focus on building the right products at the right time.
We’d love to hear from you – what are some processes and tools you use to help improve the odds?