A Brief History of Product Management: Starts With a Spark
Product management was originally seated in marketing but has evolved. It's still misunderstood but it's now getting the recognition it deserves with product people...
Can you guess which profession Americans deem the most ethical and trustworthy? How about the profession they trust the least?
Every year Gallup conducts a national poll on these questions, and in 2017 the list broke down very similarly to the way it almost always does. Nurses topped the list, with 82% of people describing their honesty and ethical standards as “high” or “very high.” At the other end of the list—second to bottom with just 10% trust—were car salespeople.
Our point? Well, isn’t it odd that car buyers almost universally distrust the salespeople we have to deal with when we walk into a dealership—and yet we still overwhelmingly buy cars that way? Today we have the technology and systems in place to buy just about everything—including cars—online. We can click a few buttons on our computer or our phone and, just like that, a day or two later a delivery truck pulls up to our home or office. We don’t have to go anywhere, speak with anyone, or give any human being a chance to “sell” or “upsell” us.
There’s no technological exception for cars. The online-only, no-salesperson process could work just the same as it would to buy a car as it does for someone buying another high-ticket item over the Internet—like gold coins, or a high-end watch. In fact, a few people actually do buy their cars this way.
Given all of that, why is it that such a high percentage of consumers still buy cars the same way our grandparents did 60 years ago – by walking into a showroom and engaging with someone whose profession we overwhelmingly distrust?
Because for better or worse, most Americans still prefer to do it this way. Perhaps it’s because we like to ask a bajillion questions about a car before buying, or because we feel the need to actually touch and test the car before we purchase. And perhaps certain types of a product just call for their own peculiar sales methods.
Which brings us to your company and your product team.
It’s very easy to default to a sales channel for your products for the wrong reasons. Maybe your product team has inherited an in-house sales force, or maybe you’re a scrappy but underfunded startup and your stakeholders have decided to save money by automating the sales process. Neither is a good reason to sell your product that way.
When was the last time you stepped back and examined your sales channels to determine if they’re the right ones for your products? Here are a few things to consider when conducting that review.
Let’s say your company sells enterprise SaaS applications, maybe seat-based licenses starting in the $10,000-per-year range. You have an assisted sales force out there pitching your products, and they’re highly motivated because you offer a generous commission structure on those licenses.
But then your team introduces smaller, less robust versions of your product, maybe designed for the SMB market or even for solopreneurs. Those licenses cost just $150 a year. Question: Can you sell those low-end products through your existing sales force? Absolutely not. The incentive just isn’t there, even if you offer the same generous commission percentage as on your enterprise apps.
So it’s a good idea to step back, review all of your products and how they’re sold, and ask yourself if there’s a better channel for some of them. If there is, shift your focus to the new channel opportunities and make sure your sales and product teams stay aligned during the process.
About a decade ago, one of the major vitamin companies (Herbalife) infamously introduced a new sales channel—a slick, sophisticated eCommerce site—to sell their products directly to consumers. Great idea, right? Wrong.
Herbalife, after all, is structured as a network marketing operation (formerly called multilevel marketing), built on selling through outside sales reps or “distributors.” Those distributors own the relationships with their customers, and they guard those relationships fiercely because they can last for years and be very lucrative.
So when the corporate team set up its online shop—even though the company would share commissions from online customer sales with the nearest distributor—they were undermining those direct relationships. In other words, they were competing with their own sales force.
It’s worth reviewing all of your own sales channels, to learn if your resale partners could be undermining your in-house reps or vice versa and if your sales are suffering because one team feels blocked or forced into competition with another.
We don’t mean this literally, of course. But is it possible that in your company’s attempt to automate the sales process and save money, you’ve removed some of the hands-on guidance and selling that your product requires to close the deal?
Perhaps your prospective customers don’t feel comfortable deploying your software across their company without first talking it through with someone on your team. Or maybe your trial page is just too complicated. Or your prospects get scared away because they can’t tell looking at your website whether they’ll receive enough training and onboarding help as they’d like.
It might be a good idea to do some research—ask your existing customers, ask prospects who didn’t buy from you, review your competitors’ process—to find out whether you could be turning off would-be customers because you aren’t giving them enough of an opportunity to ask those questions or speak with a live person before buying.
“Do some research to find out whether you could be turning away would-be customers because you aren’t giving them enough of an opportunity to ask questions or speak with a live person before buying.”
Bonus suggestion: Finally, it’s worth building the customer’s purchase experience into your product roadmap. By treating that stage of the process as part of your product itself—which it is, in the sense that every touchpoint your customers have with your company is part of your product—you and your team will be much more likely to make sure your sales process is properly aligned with the unique characteristics of both your product and your customers.