Product Management…Play “Double The Price”

A few months ago, I was with group of extremely talented marketers trying to figure out what to do about a credit card product. The product was under-performing – customers were giving it ho-hum marks and growth had stagnated.

After batting around a few ideas, I suggested, “Why don’t we double the price?” Crickets. Everyone in the room thought I was nuts. “Ok,” I said, backing down. “Let’s just pretend that we’re doubling the price.” And then some very interested things happened, over just one 3-hour conversation:

      1. We riffed all about the customer.
        Unencumbered by any filters, who, very specifically, derives value from your product? Ignore, for a bit, whether your definition of the ideal customer makes the pool of customers too small to meet corporate acquisition goals, or too big relative to the marketing budget. To whom is this product truly of service: gender, income, profession, passions, needs, age … even name? Have fun with it.  Draw pictures.


      1. We explained the product, in one sentence, to my mother.
        The ruse for me is critical, because my mother is one of the few people on this earth that I just can’t lie to. No way I can pull the wool over her eyes. She also has no patience for long explanations. Figuratively sitting across the table from my mother trying to explain to her why she should get a product has enabled me to develop the tightest of positioning statements. Pick the person in your life that calls your bluffs, and tell them in one sentence why your product is good for them. Don’t stop until you can actually do it.


      1. We were brutally honest about which benefits delivered real value, and which did not.
        Brutal honesty is critical here. Only highlight benefits which both are of value and which deliver. A 2-for-1 companion ticket program is a great benefit for travellers, but not if it makes them fly through Singapore to get to Chicago from New York. And don’t be disappointed if a number of benefits fall on the wrong side of the ledger – you just found yourself some money.


    1. At the end, we asked ourselves the big question: do we double the price?
      Don’t underprice your product – it signals to the customer that you don’t believe in what you’re delivering. Don’t charge Lexus prices for a Corolla either. But regardless of where you net out on price, strive to know what it would take to pull a Starbucks (create enough value to charge $4 for a cup of coffee that used to sell for $0.99). Maybe one day you’ll have the investment/infrastructure/courage to go for it.

At the end of the day, the team took no action on price. But they tightened marketing significantly and generated demand. They also improved profitability by eliminating a number of low value features. More importantly, the team coalesced, in just three hours, around what precisely they were selling and why. No data, no analysis, no market research, no PowerPoint decks. The wisdom was already in their heads. They just had to pretend they were doubling the price.

Product Management Tip of the Month: If you manage a product, take your team out of the office once a year, play “double the price,” and then take them out for pizza. It will be one of the most productive things you do all year long.

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