What is Product Lift?
The assumption we make about “products” versus “solutions” is that products are re-usable and solutions are one time answers to specific…
The assumption we make about “products” versus “solutions” is that products are re-usable and solutions are one time answers to specific challenges. Products are the things we ship to our customers that ultimately help us get closer to marginal cost = 0 while maintaining high impact. In other words, products enable economic profit. Conceptually, then, what are the ways that we can generate this so-called “product lift”? In other words, how can more value be generated per unit of product?
We can ship a thing that assumes n different users instead of focusing purely on the success of the first iteration partner
We can ship improvements that cause more users to engage with the product.
We can ship improvements that cause existing users to engage more deeply with the product.
We can ship improvements that reduce the amount of effort it takes to maintain the product for equivalent benefit.
The first statement likely is the most obvious. If we build something that cannot be redeployed to a second, third, and nth customer, then the thing is pretty much by definition not a product. A basic example here is the difference between a custom corporate employee directory that depends on all the assumptions of one organization’s structure versus Facebook at Work ( https://work.fb.com/) that can be applied anywhere.
We can also entice more users to interact with our products to create lift. A common paradigm is that of a complex/advanced version of a product and a simpler version. If you first build the advanced product and then add the simpler product, and if the simpler one attracts net new users, then the product is generating fresh value.
Another approach is to deepen the user’s interaction with the product. This assumes that depth will yield higher economic benefit either through expansion sales or in cases where the creators receive higher rents for higher value generated. In a consulting style engagement where the customer wants answers to questions, for example, a product that answers more questions or does so more insightfully may be sufficient to create more lift for the business building the product. “We helped you optimize your supply chain (value chunk one) and now we can also tell you what to build next (value chunk two).”
Perhaps the least obvious externally but perhaps most discussed within any engineering outfit is reducing the internal maintenance tax. If one engineer is able to run ten units of the product with the same effort that previously only served one unit, that is also lift. A basic example here is an administrator interface that reduces common maintenance tasks down to the absolute minimum time exertion as possible.
What else can a company do to conceptually increase the lift of its products?
Originally published at http://adamjudelson.com on July 16, 2016.