Too Many Products

Too Many Products

New products can create energy or drag for your business. Create a system to invest wisely.
Many companies grow their product portfolios beyond what is optimal and need to be faster to take action. There are good reasons why it happens, but even better reasons to act on strategic choices to maximize the business and brand.
Do you offer too many products?
Building your overstuffed catalog happens incrementally over time. It’s like your garage getting increasingly overstuffed or the frog not noticing ever-warmer water. You might not even notice the impact or may misinterpret the consequences.

It’s understandable why product portfolios grow so large. There is always pressure to grow sales and create reasons to promote the brand.
Why Product Portfolios Grow
Does this sound familiar?
Spike growth.

There’s hardly an easier way to nudge short-term sales than introducing a new product.

Door openers.

Giving salespeople a reason to get in front of customers.

Trade shows.

Nobody wants to come to NeoCon, Design Days, or any other show with the same stuff as last year.

Something new.

Designers (and just about everyone else) like new things. A&D and other specifiers often indicate that customers want more choices.

More options aren't necessarily what your customers really need. People are good at identifying what they want. Knowing what we need, however, is more difficult.

It’s a basic tenet of user research (different from market research) and a common human behavior – the paradox of choice. When presented with too many choices, people freeze. Customers are overwhelmed by choice, and we don’t always know what’s good for us.

Too many products not only confuse customers, but it confuses your organization, too. Your increasingly large portfolio creates additional management complexity.
Do you offer too many products?
Excessive offerings create organizational debt.
Internally, excessive offerings create organizational debt. Each new product complicates your operations, manufacturing, assembly, order entry, and delivery. Often, teams feel they don’t have the resources to launch products properly because they are spread too thin.

• Sales and marketing get more complicated.
• Salespeople must learn new features, benefits, and a sales script.
• Your price list gets longer.
• The website and product catalog get bigger.
• More materials and finishes to support.
• More products to fit into the showroom.

Never say never. Launching new offerings is essential to any product company. It’s really a question of strategy and intentionality. What’s the right number, and how do you evolve?
Evaluating your product portfolio
There is no magic formula, but there are good rules of thumb. The Pareto Principle is a helpful starting place for prioritization. You can evaluate which 20% of your products create about 80% of your revenue. The math isn’t this simple, but no one should invest 80% of resources to drive 20% of sales. If nothing else, customers are telling you which products they prefer.

Another lens is profitability. This is not news for product managers, but products should be designed to be profitable from the start. Product innovation can mean listening to the market without feeling forced to include features you can’t afford to offer.
Product prioirtization
If you have bestsellers with small margins, compare the long-term cost of transitioning customers to an alternative platform versus maintaining a low-margin product. Consider your product roadmap over time. It doesn't have to be all-or-nothing; it may be more like product triage.
Product Offer Triage
What is your product priority?
1. Promote

Your clear winners must be promoted and supported properly. Invest wisely in your best-selling and most profitable lines. Collectively, these are a driving force behind your brand meaning.

2. Support

Some product lines still make money and support a few critical customers. The tooling still works, so sell those products. Keep customers happy and provide support as needed, but these products don’t need to be prominently featured on your website and elsewhere – at least not in the same way. Don’t let supported but not promoted products muddy the brand picture.

3. Retire

Some products simply need to be retired. Don’t let familiarity tie you to your past – chart product evolution paths, allowing new, better products to fill old seats.

Build product platforms with intentionality. What if you invested more fully in your top 20%? Can you expand or build on your top products? Consider what product extensions and programs can maximize your best sellers. Your product portfolio is a system, not a collection of widgets.

Ultimately, you must consider what it all adds up to. A strong market position should be the bottom line organizing principle and filter. Best-selling products unrelated to your strategic focus muddy the picture and erode your brand's meaning over time.
Product portfolio strategic focus
Create a focused, powerful, profitable brand that customers and designers want to specify. There are sales talking points, trade shows, and novelty to be found beyond another new product. Your overall brand experience plays a significant role in today's economy of choice.

Focus your resources on the necessary complexity of your business. Evolving your tight product portfolio is difficult but essential to maintain strategic focus and profitability. Not only will cleaning out the garage make you feel better, but you may once again be able to park there.

Ways to get started