Figuring Out Product Strategy When Your Startup’s Just Getting Started

When you’re building a startup, product strategy is your compass. It keeps your team aligned, ensures your resources are focused, and helps you avoid wasting time on things that don’t matter. The reality is, many early-stage founders either overcomplicate product strategy or neglect it altogether.

If you’ve ever found yourself stuck wondering what to build next, how to prioritize, or whether you’re working on the right things, this guide is for you. By the end of this article, you’ll understand how to build a product strategy that drives results and keeps your startup moving in the right direction.

Why Product Strategy Matters (Especially for Startups)

What Is Product Strategy?

At its core, a product strategy defines what your product will achieve and how it will achieve it. It aligns your product’s development with your company’s goals and helps you focus on delivering value to your customers.

For early-stage startups, it’s not just about picking features to build—it’s about setting the foundation for growth. A strong product strategy answers these key questions:

• What problem are we solving?
• Who are we solving it for?
• How will we measure success?

Why Startups Struggle With Product Strategy

• Overwhelmed by options: Founders face countless ideas but limited resources.
• Lack of clarity: Without clear goals, it’s easy to build for the sake of building.
• Reactive development: Many startups chase trends or copy competitors instead of focusing on their unique value proposition.

The solution? A clear, actionable product strategy that ties back to your business objectives.

Step 1: Tie Product Goals to Business Outcomes

The first step in creating a product strategy is connecting your product’s goals to your company’s overall objectives. This ensures your team is working on initiatives that matter for growth.

Start With Your Business Goals

Think about what success looks like in the next 6–12 months. Common early-stage business goals include:

• Acquiring a certain number of users.
• Achieving product-market fit.
• Generating initial revenue or reaching a revenue milestone.

Translate Business Goals Into Product Goals

Once you’ve defined your business goals, map them to specific product goals. Here’s an example:

Ask the Right Questions

• What product changes will directly impact these goals?
• How can we deliver value to customers while meeting our business objectives?
• Are our product goals realistic based on our current resources?

Step 2: Break Down Goals With KRs and Initiatives

Setting goals is just the beginning. To achieve them, you need measurable Key Results (KRs) and actionable initiatives.

What Are KRs?

Key Results are measurable indicators of progress toward your goals. For example:

• Goal: Increase active users by 25%.
• KR 1: Reach 10,000 weekly active users.
• KR 2: Reduce bounce rate by 15%.
• KR 3: Increase average session duration by 20%.

KRs provide clarity and help you track progress. But they’re not actionable on their own—that’s where initiatives come in.

Turning KRs Into Initiatives

Initiatives are the specific actions or projects your team will execute to hit your KRs. For example:

• KR: Increase weekly active users by 20%.
  Initiatives:
  1. Launch email campaigns to re-engage inactive users.
  2. Optimize the onboarding process for new signups.
  3. Introduce a gamification feature to boost engagement.

Step 3: Prioritize What to Build

You’ll always have more ideas than time or resources. Prioritization ensures you focus on what matters most.

Frameworks for Prioritization

1. ICE (Impact, Confidence, Effort):

• Score each initiative on a scale of 1–10 based on:
  • Impact: How much it moves the needle.
  • Confidence: Your belief in its success.
  • Effort: How much time/resources it requires.
• Prioritize initiatives with high scores.

2. RICE (Reach, Impact, Confidence, Effort):

• Similar to ICE but adds “Reach” to account for how many users an initiative will impact.

3. MoSCoW (Must-Have, Should-Have, Could-Have, Won’t-Have):

• Categorize initiatives based on their importance.

Real-Life Example: Prioritizing a Feature Launch

Imagine your goal is to improve customer retention. You’ve brainstormed three initiatives:

1. Build an in-app tutorial: High impact, medium effort.
2. Create a rewards program: Medium impact, high effort.
3. Enhance customer support: High impact, low effort.

Using ICE, the in-app tutorial and enhanced support should take priority.

Step 4: Validate Ideas With Data

Avoid building features based on assumptions. Use data to validate what your customers need and how they interact with your product.

Data Sources to Leverage

• User Analytics: Track usage patterns with tools like Google Analytics, Mixpanel, or Amplitude.
• Customer Feedback: Use surveys or interviews to understand pain points.
• A/B Testing: Experiment with different versions of features to see what resonates.

Example: Optimizing Onboarding

Let’s say you notice a high drop-off rate during onboarding. Data suggests users struggle with a specific step. By tweaking that step and testing the change, you can reduce friction and improve conversion.

Step 5: Build for Iteration, Not Perfection

Your product strategy should be a living document, not a set-in-stone plan. The market evolves, and so should you.

Steps for Iteration

1. Review Regularly: Schedule monthly or quarterly roadmap reviews.
2. Gather Feedback Continuously: Stay connected to your users.
3. Experiment and Learn: Treat each initiative as a test.

Real-Life Example: Slack’s Iterative Approach

Before Slack became a $20B company, it was an internal chat tool for a failed gaming startup. The team iterated on its product, pivoted to focus on chat, and refined its features based on user feedback.

Common Pitfalls to Avoid

1. Focusing on Features, Not Problems

• Instead of asking, “What should we build next?” ask, “What problem are we solving?”

2. Ignoring Customer Feedback

• Don’t assume you know what users want—validate with data.

3. Overcommitting

• Trying to do too much at once leads to burnout and mediocre results. Focus on high-impact initiatives.

Tools and Resources to Support Your Strategy

• Roadmapping Tools: Floumy or Productboard for visualizing initiatives.
• Customer Feedback Tools: Typeform, Intercom, or UserTesting.
• Metrics Dashboards: Floumy or Perdoo to track KRs.

Questions for Founders to Reflect On

• What’s the one thing you could build today that would have the biggest impact?
• Are your current initiatives aligned with your business goals?
• How often do you revisit and adjust your product strategy?

Conclusion: Build With Focus and Purpose

Creating a product strategy isn’t about being perfect—it’s about being intentional. By tying your efforts to business goals, prioritizing initiatives, and staying adaptable, you’ll set your startup on a path to sustainable growth.

Sources

1. Lean Startup by Eric Ries: A must-read for understanding iterative development.
2. Measure What Matters by John Doerr: A deep dive into OKRs and goal-setting.
3. The Mom Test by Rob Fitzpatrick: A practical guide for validating ideas with customers.