In a November 2020 digital session, Amy Zima, Principal Product Manager at Spotify, aims to clear up the confusion around creating a product strategy by sharing a case study and lessons learned.
Amy explains that the term strategy can often intimidate product managers because they may not know where to start. However, every product manager can and should articulate a product strategy by using key tools they already possess. She emphasizes that strategy is different from a plan or roadmap; these elements stem from your strategy. Essentially, she says, strategy is about the choices you make. It doesn’t have to be perfect and can evolve over time. It’s also applicable to any level of problem.
To illustrate, Amy asks us to consider a checkout flow for an app. The vision might be for every customer to complete the checkout without issues, and the goal could be to increase the conversion rate by a certain percentage. Amy walks through various strategic choices for improving the checkout flow.
Focusing on Spotify’s vision to be a top-notch podcast product, Amy outlines the initial step towards a strategy: understanding the problem and opportunity by answering basic product brief questions—who the users are, what their problems are, etc. At Spotify, they spent significant time defining what being a compelling podcast product meant and tested this in their research. Besides product-brief questions, it’s also essential to ask what needs to come true for the vision to be realized. For example, to reach a specific number of listeners, Spotify would need to introduce podcasts to many users for the first time.
After asking these questions, the next step is to identify choices. Amy points out three choices Spotify considered: creating a separate app, adding a podcast tab, or integrating podcasts into the existing Spotify experience. Each option had its pros and cons. The first option would offer a brand-new experience but require finding product/market fit from scratch. The second could start fresh but might not help build a natural podcast habit for users. The third option would introduce podcasts to new users but might compromise creating a world-class podcast product.
The critical step is making trade-offs and deciding which pros and cons are most important. Amy asked the audience at the event which option they would choose. Spotify eventually chose the third option—integrating podcasts into the Spotify experience. This route was chosen because it allowed them to reach users who wouldn’t typically listen to podcasts and leverage features Spotify excels at, like personalization and recommendations. The necessity to create a new audience and achieve growth outweighed the challenges associated with building the integration.
For further learning, Amy recommends reading “Good Strategy/Bad Strategy” by Richard Rumelt and “Strategize” by Roman Pichler. She concludes by stating that “the plan is obvious when the strategy is good.”