Product-market fit is a concept that captures how closely your product aligns with the desires of the market. It should be a consideration on the forefront of your organization’s mind when launching new products or tailoring existing ones. Not only does it have a significant impact on your top line revenue and market capture, but it is inextricably related to customer satisfaction, retention, and cross-sell/upsell opportunities.
In this blog post, we’ll talk about how you can optimize your existing products’ product-market fit to ensure success. In our next blog post we’ll talk about new products.
First, it’s important to understand that existing customers don’t look like potential customers. They’ve already adopted your products—they’ve already chosen you. Therefore, ensuring your product continues to align with your customer’s goals is key to guaranteeing they stay with you.
Too often, organizations with successful, well-adopted products fall into the trap of product stagnation and focus their efforts on operational improvements. While factors like support, account management, and the UI play an important role in customer retention, it is more important to make sure the product continues to align with customer goals.
Dan Olsen, a Product Management Consultant and entrepreneur who spoke at the Gainsight Pulse Conference 2019 that Topline Strategy attended, provides a useful framework for understanding how to ensure your product continues to achieve the product-market fit your customers need. Organizations should consider two dimensions when determining which aspects of a product are most critical to address:
- The importance of a function, feature, or service to the customer, and
- The current level of satisfaction with that function, feature, or service
Plotting these two dimensions, with “Importance” on the vertical axis and “Satisfaction” on the horizontal axis, helps determine which aspects of a product your organization should focus on (see graphic below). While it may seem like a good strategy to dedicate resources to things that have “high satisfaction, high importance” or “low satisfaction, low importance,” organizations should actually turn their attention to the top left corner, “low satisfaction, high importance,” to discover the most strategic areas for organizations to dedicate resources.
A Strategic Customer Experience program, like the one Topline offers, is the best way to make sure you are on top of your customers’ “low satisfaction, high importance” needs. By staying on top of your customers’ changing needs, you will be on track to make incremental changes to your product that are in-line with your customers’ goals thereby achieving and maintaining product-market fit with your existing customers.
In our next blog post, we’ll explore the importance and the best approach for achieving product-market fit for new products your organization might be launching. Stay tuned!