Comments on: Product Manager Tactics: Bringing In A Price Fighter

By: Blue Elephant Consulting » Blog Archive » Lessons From Starbucks’ Product Managers: How To Protect Your Product’s Rear

Sat, 12 Nov 2011 02:55:28 +0000

[...] Starbucks plans on rolling out a second coffee brand, you guessed it, Seattle’s Best Coffee. This is the brand that they are going to use in order to compete with the lower-priced fast food coffee offerings that have been nipping at their heels. [...]

By: Lessons From Starbucks’ Product Managers: How To Protect Your Product’s Rear

Mon, 09 Aug 2010 04:04:10 +0000

By: Dr. Jim Anderson

Dr. Jim Anderson — Sat, 21 Mar 2009 18:11:47 +0000

David: So you bring up a couple of very good points. Yes, price based competition will always occur no matter what market you choose to play in. However, it doesn’t have to drag you down. Constant innovation is what keeps high end products in the high end segment. The examples are everywhere: Apple, Prada, BMW, Mercedes, etc. You can “own” the high end of the market, but the key is that you can’t own both the high end AND the low end with the same product(s).

By: David Locke

David Locke — Thu, 19 Mar 2009 17:30:24 +0000

Price-based competition happens just like clockwork. A category comes out of Moore’s tornado, and surprise, actually, no surprise, it’s your turn. Put this reality into your product roadmap. Know it’s coming, be ready.

Being ready means getting your value messaging out there, changing the sales compensatioin plans to get rid of discounting, not moving up market, and ensuring that the value you deliver hasn’t been eaten into by your competition. There are a ton of things you can do. The above list is just the short list.

Some of these things might seem out of scope for a product manager, but if you are trhe CEO of the product, they aren’t. It might be that all you can do is evangelize the distant elements and find a coallition, so add that work to your plate and hit it everyday.

The only way you should be surprised by the arrival of price-based competition is if you just got the job, or just got dropped into this mess. Congrats!

As for a price fighter, if you love to fight go ahead, just remember that there are competitors down there as well. You might lose the low end of the market, and the noise will be heard upstairs. Your high end customers could buy a few seats of low end in lew of a few seats of high end. Ouch!

Read the book mentioned in the blog. Then, go find where price boundaries exist as the book suggests. Then, you might just raise your price in a few of those markets.

If you think price-based competition is bad, commoditization is just around the corner as well. TKO!

By: Dr. Jim Anderson

Dr. Jim Anderson — Thu, 19 Mar 2009 12:44:14 +0000

Sachendra: fantastic – I’m glad that the post helped you out! You bring up a good point about not getting rid of the price fighter later on. It can act as sorta a “guard dog” in your market. A constant reminder to potential competitors that will let them know that you can play in the top and the bottom of the market and that it would be too expensive for them to try to compete with you!

By: Dr. Jim Anderson

Dr. Jim Anderson — Thu, 19 Mar 2009 12:42:12 +0000

Jim: you bring up a good point – just because your product is struggling doesn’t mean that creating a price fighter will magically solve your problem. A price fighter is a solution to a specific problem – it will only work if you have the right problem.

As far as not loving your product goes, well ok. However, I’m going to push back just a bit here – if ANYONE needs to believe in (sorta like love) your product, it needs to be the product manager. Where you draw the line is a personal call, but you do need to have a healthy relationship with it.

Finally, yes – a product manager needs to be ever vigilant. Even worse than trying to deal with the problems that are facing us is getting surprised by a problem that we didn’t even know existed.

By: Sachendra Yadav

Sachendra Yadav — Thu, 19 Mar 2009 05:25:40 +0000

What a timely post. I have been struggling with the same problem off late and all the while the solution had been staring me in the face… I own an Aiwa TV

A price fighter product will definitely help and it can help position the better product more effectively. I wouldn’t want to discontinue it as the low-price game will keep going on with different competitors.

By: Jim Holland

Jim Holland — Thu, 19 Mar 2009 04:12:08 +0000

The idea of a “price fighter” may be an option, but is it a quick fix for a product looking for a market, bad messaging and positioning, or lack of really understanding what customers really are asking for?

I believe the minute a product manager admits that “your product, your baby, is struggling” is a sign that person needs a reality check. I’ve liked a lot of products in my career, but none that I’d treat like loved ones.

As we look at the economy, all facets of product success need to be urgently reviewed. Often, its one gap in the defense that will get you knocked out.