5A 3190 DMCM
• So what’s the problem?
– You have to produce a digital marketing strategy
– You have to create a market segmentation
– You have to describe a typical digital customer
– You have to produce a digital customer experience
• So what do you need to learn?
– How we define “Digital Product”
– How the Digital World affects “Digital Product”
– How the 2 “I”s affect “Digital Product”
– What the dynamic nature of digital product
– What digital product development is
– How digital products enable electronic customer
The Fundaments of Digital Product
• A digital product exists for the purpose of a digital
• Core Benefit
– The fundamental value of the digital product
• Basic Digital Product
– Minimum digital product offering needed to deliver
the core benefit a customer expects from a digital
• Augmented Digital Product
– Features that go beyond the customer’s minimum
Digital Product Value Hierarchy
Does the product taste good? Is it dependable and consistent?
Does it offer good value? Is it packaged conveniently and pleasingly?
What does the product offer? Thirst quenching? Refreshment? Stimulation?
Relaxation? Staving off hunger or satisfying it? Nutrition? Weight control?
Enhancement of health/fitness? Improved performance in athletic endeavours, energy,
mental activity, sex or simply alertness?
How will I feel about this product? That I've made a smart choice?
That it's a product I can trust? That I've done something good for me?
That it's simply something I'll enjoy that will make me feel good?
That I'd like people to see me choosing it?
e.g. Choosing Drinks
Defining Digital Product
• Generally 2 sorts
– Tangible Goods
• Easily understood because the buyer can see and often
experience their benefits prior to buying
• Actions that companies offer to customers for the
purpose of transaction
• What about a lifestyle offering or a brand?
• These tend to be governed by certain
– Level of quality
– Brand Name
• These tend to be governed by 4 characteristics
– Can’t be touched or possessed – not a physical good
– Producer and consumer need to come together at a single
time for exchange
– Subject to variability
– Excess capacity to provide cannot be stored
HOW DO THE DIGITAL WORLD AND THE
2 “I”S AFFECT THE DIGITAL PRODUCT?
Types of Digital Product
Type of Digital
Product Main Purpose Digital Attribute e.g.
Digital Goods Core benefit comes in a
Create once, reproduce
Software, news, music
Service Core service is digital Standardised service,
producer and consumer
are separate in
Online games, search
Retail/Distro Digital sales/
for real-world delivery
Disposal of inventory,
aggregation of demand
Online book store
Augmented Product Add extra service or
features to a product or
Low cost approach to
Parcel tracking, online
The Effects of the 2 “I”s on Digital Product
Easy to convey prices to
Allows more targeted price
Different presences cater to
Dynamic pricing presences
can keep individuals informed
Allows for responsive service interactions
providing augmented value to product
Allows organizations to quickly gather
valuable customer data (e.g. preferences)
Customers directly involved
in the product development
WHAT IS THE DYNAMIC NATURE OF
DIGITAL PRODUCT PORTFOLIOS?
The Digital Product Portfolio
DEGREE OF INNOVATION
New to the organisation
New to the market
Effect of Entry Order to Digital Market
Follower “Me Too!” “Slackers”
Rule of thumb: First to market & fast followers often have sustainable CA
Digital Product Lifecycle
BIRTH GROWTH MATURITY DECLINE
WHAT IS DIGITAL PRODUCT
DEVELOPMENT AND HOW DOES IT
ENABLE ELECTRONIC CUSTOMER
Conventional Product Development
Convergent & Divergent Thinking in Digital
BRAIN STORMING IDEA SCREENING
allows you to narrow
the focus over time
New Digital Product Development
BUSINESS DRIVERSCustomer Business
Objective? Generate more existing business?
Attract new users, or keep existing?
Customer expectation of particular
imagery or positioning?
New product fulfill needs/aspirations?
Extending existing brand name or new?
Fit with portfolio?
Fierce, nonexistent marketplace?
Role of the channels?
How measure performance?
Resources and skills needed?
Timing for market introduction?
Do we have resources?
How long & how much?
What is the required business
Can we do it or do we need help?
Does the technology exist?
Managed internally or outsourced?
Digital Product Development Process
ITERATIVE PRODUCT DESIGN
ITERATIVE MARKET TEST
Digital Customer Input
Digital Product Design and
Digital Communication Tools
Digital Experimentation and Testing
Digital Product Levers by Relationship
Acquisition Conversion Retention Dissolution
Presentation & packaging
Attributes & features
attributes & features
attributes and features
Migration to different
product in the portfolio
What We’ve Covered Today
• We’ve defined “Digital Product”
• We’ve looked at how the Digital World affects
• We’ve seen how the 2 “I”s affect “Digital Product”
• We’ve investigated what the dynamic nature of
digital product portfolios is
• We’ve looked at what digital product development is
• We’ve shown how digital products enable electronic
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