Any good product that hopes to make a dent in a sector of any market needs to be well-thought-out and planned before it even comes close to hitting store shelves, and that’s where product service management comes in. At MentorCruise, we’ll be taking a closer look at product service management, how it helps your products succeed and why it’s such an important part of establishing any company.
What is Product Service Management?
Product service management is, as the name implies, a marketing function focused on the act of managing a product or service sold by a company. This includes maintaining an image for the product/service, ensuring it keeps up with customer demand in terms of stock and features, marketing the product to its intended audience, expanding the intended target audience, improving already existing products and taking feedback to enhance subsequent products.
It’s a complex process that takes into account many different aspects of sales, as well as the product itself and its target audience. It’s a tough job, one that takes a lot of mental fortitude, foresight and understanding of market shifts to pull off. All of this also applies to services, though the approach to both is relatively similar with only their factors being different.
A good example of product service management at work is the Apple iPhone. It’s an item that features small iterative changes every year, changing it slightly in terms of user experience, software, hardware and design in order to best fit what consumers want at the time of release. It was not only a pioneer when it comes to smartphones, but also in the way we store and streamed music services. In fact, it can be argued that the iPod’s death, one of its handheld music devices, was caused by the iPhone itself.
Why is Product Service Management So Important?
For a company, it’s incredibly important to make sure your product or service is flexible so that it can be adapted to fit any quick market shifts. If your product remains stagnant while competitors develop further, you’ll lose out on sales quickly and need to play catch-up in terms of product evolution. Not only will this harm your future prospects, but it may cause your buyers to switch to other alternatives.
Any business owner knows that securing customer loyalty is a must in any competitive sales industry, so to pull that off your company needs product service management.
Strategic approaches to building products and services have become the norm as opposed to the more old fashioned approach of building a product and waiting for customers to approach. Because of how harshly competitive markets are now, every second counts, and this has led product service management to become an essential tool as opposed to an optional approach to development.
What Are the Duties of a Product Service Manager?
Boiling down the duties of a Product Service Manager can be done fairly easily, but breaking down the specific tasks done can get complicated. Because of this, we’ll be separating every single duty into its own segment, giving it a sufficiently in-depth explanation so you get a better idea of how everything needs to be done.
1. Performance evaluation
One of the primary responsibilities of product service managers is to assess the performance of existing products and determine if they’re meeting their specified objectives and targets.
This involves analyzing key performance indicators (KPIs) including, but not limited to:
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Sales revenue
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Market share
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Customer satisfaction
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Profitability
Following this performance analysis, it’s the job of the product manager to determine the course of action and future roadmaps to address any shortcomings that have been identified.
This can involve looking to improve the product through minor adjustments or further product development, or potentially discontinuing the product offering entirely.
2. Observing the changing needs and desires of the target audience through feedback management
In order to create a product or service that people will want to purchase, it’s first important to establish who you’re aiming your product at, and what they want out of it. Keeping up with what your consumer wants through feedback and testimonials will make marketing and selling your product to them an easier process.
Going back to using smartphones as an example, some smartphones are targeted squarely at tech enthusiasts, and as such the features on the device need to be tuned to their tastes, be it innovative new additions or the fastest chipsets available. On the other hand, smartphones targeted at casual audiences will emphasize aspects like pricing, design or camera quality to draw in customers.
If you’re running an online company or have an online presence that allows you to gather feedback, there are many types of feedback that you can gather, such as:
- Ratings, reviews and testimonials. There are many platforms for different niches where customers congregate and share their experience with your product or service, including Google My Business, Capterra, Yelp, and TripAdvisor. You can even turn these reviews into social proof to highlight the usefulness of your offerings
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Net Promoter Score rates how customers feel about your product on a scale of 0 to 10. Use tools such as Qualtrics, SurveyMonkey and Google Forms to gather this feedback. If you run an eCommerce business or run a marketplace like MentorCruise, you can use a transactional email service to send clickable NPS emails to your customers or clients to measure their experience.
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Social media buzz. Go through the comments section of your social media profiles to see how they engage with your services.
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Surveys, focus groups and questionnaires. You can also use these methods to check fleshed out opinions that people have over your offerings.
These are just the tip of the iceberg. Feedback management is a complex process and what best types of feedback for you depend on your business needs.
3. Observing competitor actions
As a company, you always want to stay ahead of your competitors in one way or another in order to secure customer loyalty. As such, product service managers make it a key part of their jobs to keep tabs on all developments by their competitors in order to keep their own products and services competitive.
A good product service management example of this is eCommerce platforms, and how they evolve their options based on what their competitors introduce. This has led to many advancements in the eCommerce sector, from accepting instant Paypal and card payments to the introduction of cryptocurrency as a valid means of purchasing products and services.
4. Analyzing market trends and advances in technology
Another core component of a product manager’s responsibilities is to stay up to date with market trends, industry developments, and emerging technologies that are relevant to their products.
As part of this process, they’ll evaluate if their products are aligned with the latest market demands and drivers, and ascertain if any advancements or adaptations should be implemented within the company’s own products. This helps to ensure their product offering remains competitive with the latest products on the market.
In addition to the incorporation of new features, this process could also involve exploring partnerships with companies that have developed complementary solutions or leveraging new technologies to enhance the current product offering.
5. Developing new products and services
The bread and butter of product service management is in development, and this is where all the observations made will finally factor in. It’s a heavily involved process that involves conceptualizing the new product or service, calculating costs of production, following government regulations and keeping an eye on shifting market trends to make adjustments during product.
It is an exciting time for any product service manager, but also one that will represent the company’s performance and future in any given segment. As such, it can be a stressful position to hold, but one that’s necessary and rewarding.
6. Maintaining and monitoring current offerings
After releasing a product, it’s also on the product service manager to keep the company’s entire backlog of products and services up-to-date in online databases or customer catalogs. Product service managers will once again repeat the process of collecting feedback, observing market trends and then introducing new products and services to fit the new needs and desires of customers.
Current products will be updated for new customers, while older, weaker products that no longer sell well will be discontinued and outdated services will be removed in order to cut costs and prevent losses. Leftover stock will then be sold in a way that simultaneously promotes new products in an effort to make back as much as possible.
7. Pricing and profitability analysis
Product and service managers must regularly evaluate their company’s pricing strategy to maximize the profitability of its existing products.
This is achieved through evaluating factors such as production costs, market demand, competitor pricing, and customer value perception.
Based on this analysis, the product manager will determine if any changes are necessary. Potential changes would include pricing adjustments or changes to promotions or special offers such as discounts or bundling strategies to maximize revenues and profitability.
8. Lifecycle management
A product manager must observe and assess each and every stage of their product’s lifecycle.
This starts from initial conception, runs through product launch and initial adoption, to maturity and potential decline.
They assess if a product is reaching market saturation or decline stages and make decisions on whether the company would be better served by updating the product, rebranding it, or potentially diversifying the offering in some other way.
Alternatively, they may determine that it’s in the best interests of the company to phase out the product entirely and focus whatever resources are available on developing new products.
9. Supply chain and distribution analysis
Whilst more commonly associated with the Supply Chain Manager or procurement functions, product managers are often required to evaluate the efficiency and effectiveness of the supply chain and distribution channels supporting their products.
As part of this process, they will assess various different elements of both supply and distribution such as inventory management, production capabilities, logistics, and channel performance.
Based on this analysis, they will either make decisions on things like optimizing the supply chain, exploring new distribution channels, and improving channel relationships. Alternatively, product managers may pass their recommendations on to the supply chain or procurement manager to inform their final decisions.
That serves as a good wrap up for what product service managers do, though more often than not there are added levels of complexity to the job. It’s why getting a good product service manager gets told to business owners time and time again.
Benefits of Product Service Management
The benefits of product service management for your business are endless, but to summarize, they can be grouped into short bullet points which we’ll list here.
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Increasing your company’s profits and sales. As a company, this is your main goal, and product service management ensures that you’ll minimize your losses and maximize your profits as much as possible.
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Expanding your customer base. While it’s undeniably important to keep your existing customers happy, you always want your business to grow further and farther. Product service management allows you to expand your customer base without alienating existing customers.
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Ensuring customer loyalty to your brand. Customer loyalty is an essential part of keeping any business afloat, and it’s not an easy thing to maintain. Product service managers specialize in keeping your customers satisfied and interested, making them essential to business.
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Properly managing product backlog. Keeping all your products maintained and well managed helps minimize your losses and keep inventory moving at all times. The last thing your business needs is overstocked obsolete products that can’t be sold, and a product service manager keeps this from happening.
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Maintaining business flexibility. You always want your business to stay flexible. Adapting your business to fit what consumers need and what the market demands is a challenge for inexperienced business owners, and having a product service manager can help with this significantly.
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Keeping your business competitive. The last you want is your business going bust because it failed to keep up with the competition. Staying up to date with your competitors is a heavy task, but one that product service managers are experienced in doing.
Product service management FAQs
What role does product/Service management play in marketing?
Product and service management play a vital role in a business’s marketing activities by ensuring that the development, launch, and maintenance of products or services are optimized to achieve the best possible results.
Product/service management examples of marketing activities include:
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Market research
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Product and service design
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Pricing
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Means of distribution
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Customer support
Effective product and service management brings a number of benefits including:
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Aligning the offering with customer needs and preferences
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Identifying the right target markets
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Determining competitive pricing ranges
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Establishing distribution channels
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Developing additional marketing strategies
When companies integrate product and service management with their marketing efforts, they can create more compelling offerings to their customers which work to improve customer satisfaction.
This, in turn, promotes customer loyalty which translates into more customers and greater, more consistent sales revenues.
What are some examples of a product-related service?
As we’ve seen, there’s a broad range of product-related services a company must provide to remain competitive.
Some of the most important product-related services include:
Installation and setup
Many products have specific configuration and installation requirements that must be attended to before they can be used.
For instance, you might have purchased a new home security system but it requires the expertise of a trained technician to get it up and running before you can start using it.
Training and education
Not all products can be used straight out of the box. Many SaaS and other software products come with their own online knowledge bases and video tutorials. These enable customers to famililarize themselves with the functionality before they can become proficient at using them.
Maintenance and repair
Obviously, we’ve already mentioned car manufacturers in this regard, but ongoing maintenance and repair services accompany huge numbers of different products from smartphones to rented homes and a thousand things in between.
Warranty and support
These days there are very few products that don’t come with a warranty or some kind of support service.
These are extremely important because the length of the warranty and levels of support offered with any particular product can often be the deciding factor for a customer choosing one product over another.
For example, many gas boiler central heating systems can be very similar, if not identical, in terms of performance and efficiency for the same price. But often one manufacturer will provide a 7-10 year warranty whereas the alternative will only offer 3-5 years. Which is the customer going to choose?
Upgrades and enhancements
Upgrades to products are an increasingly important product service in a world becoming ever more digital. Pretty much every app and piece of software you use must provide regular patches, upgrades, and enhancements if they’re going to remain relevant and viable.
Customization and personalization
Last on our list of product/service management examples is customization and personalization. The ability to customize or personalize products and services is another service becoming more and more essential.
Increased personalization moves customers to identify more closely with a particular product or service which enhances both customer loyalty and customer advocacy.
Conclusion
Any business benefits greatly from having product service management. In 2021, companies are more cutthroat than ever and it’s basically a requirement to take any possible niche advantage you can get. If you’re having trouble finding a product service manager to help out with your company, however, don’t worry, we have a solution for you.
At MentorCruise, you can apply for a mentorship from trained professional product managers and developers who will show you every single technique and tactic you could need to successfully run your business. You’ll be able to master product service management, as well as product development and development team management and exercises. It’s a great deal, so check it out today.