Economic Downturn Strategy — Boost Your Product Teams

(This is a journey of discovery for me, so maybe part 1 of more…?)

I’m not an expert (and definitely biased although I try to check it), but I want to share some thoughts in the hope they might help as a journey through this time.

Product companies I’ve spoken too aren’t adapting as quickly as they could. They are missing the early mover advantage. There’s some obvious moves to be making. Opportunity is huge right now for coming out ahead and maybe watching your competition fade into the back. Now is the time to start testing those moves!

I’m a big fan of Bill Campbell. One lesson I learned from reading about his approach, always have high operational efficiency. It gets harder later, so build good habits from the start. Use the economic situation as an opportunity to make a change to prioritizing efficiency or merely further improve efficiency now.

Sales used to dominate the business world — before my time. But, awhile ago now, the internet made Marketing a more powerful engine than Sales, across the board. It wasn’t as important who Sales could close, because you could reach so many. Now, depending on industry, we are seeing that shift from Marketing to Product. Marketing is no longer the end goal. Your potential market is going to know if you have a bad product — there is nowhere left to hide. So, invest in your product.

Coincidentally, investing in product also makes sense as we enter a downturn. Many people will make the mistake of investing in Sales and Marketing to extend short term runways. I believe the smarter bet is in Product. Sales and Marketing do not add value that build on themselves — less value for dollar long term (especially when times might be tight later). For a long time now, the pattern of adding more Sales and Marketing has made sense — all you had to do is justify the spending by returning a positive number. However, we are moving into a time where borrowing rates are higher, cashflow may be lower, so we can’t spend as easily and choices have to be made. Sales and Marketing are still important, but given where they have been, they have more fat to trim in most organizations and less forward looking value. Product is the lean muscle that builds value over time. Investing in Product teams is an investment for lasting through the downturn.

That’s all for now. Maybe I’m way off? What do you think? Hopefully, be back with more ideas to help navigate what I think will be a challenging time ahead — which means opportunity for those who handle it well.