Last week I was invited to lecture at U.C. Extension by my respected colleague, Gary Katz, CEO of MO Partners www.mopartners.com.   I enjoy these opportunities because I am able to test some of my latest ideas. Most students at U.C. extension are college graduates who work full-time in Bay Area businesses.  They are continuing their studies to remain current with the latest trends in their field.  

Sharing ideas with the students not only enables the class to explore intriguing new ideas, but provides a terrific real-world perspective outside of my client network. 

A Student Question on Product Porfolios:

After the class a student e-mailed me:

Thank you for your presentation last night.  You mentioned that when the engineering group presents 120 products to the marketing group, the marketing group needs to sort out the product category and marketing priority.

In my experience, the engineering group's goal is to provide the product that meets the functional requirement provided by the marketing group based upon the market inputs. Therefore, the marketing group shall have known about the marketing priority of the products and have guided the product production forecast and new design requirement. It seems to be contradictory to your example. Would you please explain?

My Response:

To answer your question on product priorities, many large companies have more than 100 products and services in their portfolio.  Although marketing may define the requirements for each product or service upfront, the entire offering portfolio must be prioritized in relation to market priorities.  These priorities may have shifted from the time that the original requirements are created and by how engineering executes the offering based on the market information.

Product releases may include:

• minor releases (e.g. a 2.01.01 bug fix and features)
• a major upgrade (from 1.0 to 2.0 version)
• brand new products

Marketing needs to differentiate the marketing investment between these different types of releases. For example, product launch investments may be categorized as "A", "B" or "C" priorities.  The market investments associated with each varies.  An "A" launch may be at a big event with all hands on deck.  A "C" launch may only include an announcement on the website and combination with other "C" launches into an installed base e-mail communication.

Several companies that I work with differentiate these priorities not only by the type of release but also by whether the offering is an extension to an existing market or penetration into a new market.

An acquisition complicates such priorities. Product and services in the new company must be prioritized in terms of markets and products relative to existing products so marketing knows what types of campaigns to launch and how much to spend.  Marketing cannot afford to execute 100 campaigns and needs to define relative priorities.  We've helped client with models to determine these priorities. 


Prioritizing the Product Portfolio is Important

Prioritizing the product portfolio enables marketing to focus investment on products that will provide the greatest ROI and not over invest in cash cow products.    Although marketing is in involved in prioritizing individual product requirements, attention to the product portfolio is also important.