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High Touch or High Volume

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  • Steve Johnson was a founding instructor at Pragmatic Institute, a role he held for more than 15 years before he left to start Under10 Playbook. In his return to Pragmatic Institute, Steve supports the complete learning path for product teams, ensuring they are fully armed for success.  Over the course of his career, Steve has helped thousands of companies and tens of thousands of product professionals implement product management processes. He has worked in the high-tech arena since 1981, rising through the ranks from product manager to chief marketing officer. Steve has experience in technical, sales and marketing management positions at companies that specialize in both hardware and software. In addition, he is an author, speaker and advisor on product strategy and product management.

high-touch or high-volum

high-touch or high-volum

 

What kind of products do you build? Awesome products, to be sure, but are they high touch or high volume?

Most software products created today are designed for high-volume, low-customization scenarios. Think about the items you use on a daily basis; they’re probably high-volume products like the iPhone or Android, Microsoft Office, Trello, Jira. They’re all designed to deliver one system to a large volume of clients, and are all pretty much the same from client to client and implementation to implementation. Even Hubspot and SalesForce are more standard than they are custom.

Product marketing and marketing operation teams often use consumer-oriented approaches that don’t necessarily apply to clients who need a high level of customization and personalization. Generally, we skew towards standard products—one product for everyone. Sure, you offer various packages—good, better, best—that are easily configured, but they may not be enough.

But as you probably know well (especially if you’ve taken one of our courses), clients are not all the same. One size doesn’t fit all. And this makes sales teams understandably anxious to meet the needs of clients—which often leads down the winding road to customization.

 

The Danger Zone

While product management and development roadmap a standard product for the market, sales teams could be selling a custom product for individual customers.

Welcome to the Danger Zone.

As you can see from the chart below, in the danger zone, development builds what isn’t being sold, and sales sells what isn’t being built. Development thinks we’re selling standard; sales teams think the product can be customized easily.

 

danger zone model

 

When you get to the danger zone, development teams are often building for one target persona while the same teams are selling to an entirely different type of buyer. This usually means that somewhere along the line, the teams failed to align around a common vision.

If you have a professional services organizations that aren’t mentioned in the product business case, there’s a good chance you’re in the danger zone.

To get out of the danger zone, you have to choose.

Which is more important: high-volume products, or high-touch products? High-volume products usually require fewer touchpoints and less customization for your customers. With a high volume of clients, you simply cannot afford to customize the product for each.

High-touch implementations require a closer relationship between client and vendor, more hand-holding, more checkpoints, and more involvement in every step of the implementation. It also means you have fewer clients, each with specialized needs. You’ll definitely need a professional services component designed into the fabric of the product definition.

Finding out how much customization is required for your primary target market is the first step.

 

High-Volume, Low-Custom

Most of the examples and case studies you read about are for high-volume products targeted at the masses. And the larger the customer base, the more problematic customization becomes. You simply can’t justify the costs to create custom functionality for each customer. You’re not budgeted for a dedicated product team for each new client.

Yet it’s often a huge temptation to build functionality for one large customer, hoping that other customers will want and use that same feature. You hope the special needs of a client in California applies to customers in London. You hope the special needs of Walmart or Amazon will apply to local department stores. Consider this: packaging for toys today is designed for stacking in a warehouse more than for making an appealing display. “Lincoln Logs” now come in a box instead of a tube as they did years ago; boxes stack better than log-shaped tubes.

If you’re not careful, you could end up creating a bloated product with functions used by only one customer. Or worse, you make multiple versions (“forks”) of your product and create a maintenance nightmare. With more functionality, you create more complexity for development and dev-ops when they roll out future functionality to the market, and invariably more confusion for your customers.

 

Low-Volume, High-Custom

High volume for a standard product isn’t necessarily the right answer for your business—depending on your business and your market.

It’s not that custom work is bad—but it is a strategic decision.

Do you want to customize your products for individual clients? For companies that serve markets with a small number of potential customers, you’ll get myriad requests for one-off functionality. And that might be okay.

Consider airlines as customers. There are only a few of them, and each is sufficiently unique that one standard tool is unlikely to meet their needs. Or how about colleges and universities. There are only a small number of them—compared to, say, the number of customers in the smartphone market—and each has mandatory requirements imposed on them by city, state, and country government agencies. Both airlines and colleges have extensive, unique, non-standard requirements.

Low-volume markets usually require a high level of customization. More contracts with substantial professional services, more intimate engagement during implementation. In other words, high-touch.

But the key is this: think configuration, not customization.

For low-volume, high-custom products, your customers and your professional services need configurable installations, neither one-size standard nor single-customer customization. Your product team will approach the product requirements differently. They’ll set up more configurability options in the installation. They’ll build more APIs to other systems. They’ll create a scripting language or configurable displays and reports.

So which is your business? Step 1 is to make the decision: High-volume or high-configuration? Step 2 is explaining the impact of this choice to executives, development, and marketing teams so you can build a system that meets your customers’ needs.

Some markets want standard products; some markets require configurable products. Your company wins when your teams align around the market and its problems.

Author

  • Steve Johnson was a founding instructor at Pragmatic Institute, a role he held for more than 15 years before he left to start Under10 Playbook. In his return to Pragmatic Institute, Steve supports the complete learning path for product teams, ensuring they are fully armed for success.  Over the course of his career, Steve has helped thousands of companies and tens of thousands of product professionals implement product management processes. He has worked in the high-tech arena since 1981, rising through the ranks from product manager to chief marketing officer. Steve has experience in technical, sales and marketing management positions at companies that specialize in both hardware and software. In addition, he is an author, speaker and advisor on product strategy and product management.

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