In this post, I will talk about the job of a product category manager, and will discuss the key roles & responsibilities through examples from my journey as a product category manager.
Product management or Category management roles have emerged as a great career option in the last few years. Besides the big MNCs, there are several Product & Category management roles that have been created by E-commerce companies & tech startups. If you aspire to become a PM or already working in this domain & want to know something more do read this post, watch this video or listen to this podcast.
1. Build a winning Product Portfolio & Roadmap
What is a product portfolio?
A product portfolio is the collection of all the products or services offered by the company. The company offers or sells these products to get more revenue/ profits and market share.
A product portfolio may comprise of different categories of products, different product lines & the individual product itself. For example, A Computer manufacturing company would have product categories like laptops desktops, monitors, accessories. Each of these categories would be managed by a Product Category manager.
How to build a winning Portfolio?
A winning or strong portfolio is where you have various products to offer to different customer needs & preferences.
For example, SAMSUNG which makes smartphones would have different product models like Galaxy M series for budget-conscious customers, Galaxy S series for value buyers, Galaxy A series, S series and Z series for their mainstream and premium product range which offer better features.
Likewise, Hyundai will have different cars in each of their hatchback, sedan, and SUV range (from economy to premium) to cater to different customer needs & segments. So, having a portfolio that can cater to different customer segments can help get the maximum market share of the company.
In this context, it is important to note – since Hyundai understood the different needs and preferences of Indian customers it was able to get a higher market share in the last 25 years, whereas Ford India which also launched its first car in 1996 couldn’t understand customer preferences and lost out in the market.
Identifying a product gap & creating a roadmap
Technology & Customer preferences change at a rapid pace. Hence a PM must constantly conduct market research to identify product gaps or to search for unmet customer needs.
A product gap is basically a market segment that existing products are not serving hence it also provides a business opportunity for companies.
Another way to find out a product gap is by checking what products competition companies have & and subsequently adding if there is any missing product in your portfolio.
For example: In my product manager role at Lenovo, where I was managing the computer accessories category, we observed that while we were able to sell a basic backpack (800 Rs bag) with the laptops (range over INR 30000), we were not able to sell the same backpack with the laptops (which were less than INR 30000) because the users of those laptops were budget conscious & increase of even 800 bucks meant the budget would go up. We identified that since we didn’t have a lower-priced backpack to sell with our laptops, the customers were buying it from competition or local backpack manufacturers as standalone. Since it was a huge business opportunity in lakhs of units, we created a specific design to meet the requirement, ensured the highest quality and then created a new product. By doing so we were able to increase revenue significantly of the backpack category.
2. Forecasting demand & Planning supply
Once you have planned & constructed what products to have in the portfolio, a PM needs to forecast demand on each of those products in the portfolio.
For example: If there are 10 different types of smartphones or 20 different types of backpacks in the portfolio, a PM needs to forecast & load demand on all the products.
It is done by first studying the last 6 or 8 quarters of historical sales of each of the products – how that product has been doing in sales. Then if the plan is to increase market share on one product or to reduce dependency on another product, PM would adjust the demand accordingly. While forecasting demand one also need to consider the supply situation & based on the availability or shortage of supply a PM builds the business plan for the next quarter or year.
For instance, as you may have read or heard that there is a supply shortage on semiconductor chips, due to which many products like laptops, smartphones, cars, consumer durables, smart gadgets which all use one or the other type of chip have a higher wait or lead time. A PM also needs to incorporate these supply-side challenges while planning business for the product category.
3. Drive business growth of the Product Category
As a product owner – you have the complete responsibility of growing the business of the category. After constructing the product portfolio & forecasting demand & supply, a PM needs to create a business plan of all the products in the portfolio. The objective is to use different levers or strategies (generally called 4P’s) to drive revenue & margin growth.
4Ps is a product marketing strategy based on – Product (which is basically the strong portfolio)
Price (let me give an example of aggressive price strategy – let’s say there are 4 car manufacturers in India making hatchback cars, the market leader let’s say in Indian context Maruti/Suzuki feels that this segment will not grow because customer preference is changing towards sports vehicles and already there is strong competition eating into Maruti/ Suzuki’s market share. So, it’s slashing the hatchback cars prices by 5% to maintain or even grow its share.
Place (sales channels) – is the go-to-market strategy by which your products will reach customers. The sales channels include retail stores, large retail chains, e-commerce and so on. If it’s a B2B product it will be direct sales.
Promotion – As a Product Manager you will also need to work with the marketing team to create high impact sales Promotion to drive category growth. For e.g. an FMCG company wants to launch a new product & want to encourage usage or trials of it, a Category manager may decide to bundle it with an existing high selling product at an introductory discount. Once customers have tested the product and it gets accepted in the market, PM would introduce it as a standalone product.
Using some or all the levers & strategies a PM build a business plan for the next quarter and year & works with the sales team to drive the business growth of the category.
4. PM as a Technical Expert
A product manager is considered the subject-matter expert. She helps answer all the technical queries from customers and sales teams.
As a PM your job is to create a compelling product pitch that the sales team can use to talk to customers. It should also outline key selling points & differences over competing products.
A PM needs to make a lot of product presentations; hence the product pitch should have a compelling story as to why the customer should buy your product?
For e.g., it could be because the products have a long history of serving the needs of customers, the innovation that the company does, rigorous testing standards, quality, industry recognition and awards, etc.
Top 4 skills to have:
1. Structured Thinking / Planning
Whether it is planning your product portfolio, forecasting demand, taking any pricing decision, or doing business planning with sales, if you are someone who likes to organize the facts & data available, structure your thoughts and then put things into a business plan. you should be able to do a great job at Product category management.
Because by simply structuring the thoughts, one can rightly assess the given challenge or business opportunity and can also use the data to come up with new ideas or plans. This is an important skill that helps in all walks of work.
2. Collaboration / Teamwork
Collaboration or Teamwork is the most important skill that a PM needs to have. A PM works with multiple cross-functional teams – demand/supply team to forecast demand on products, finance team to work on costs and pricing of products, marketing team to drive brand and product awareness, order fulfilment team to get supplies faster, logistic team to get customers’ orders delivered faster. At the front end, a PM works with sales teams, channel partners & customers.
Unless you have a genuine interest to serve customer requirements and delighting them you won’t be able to work strongly with these different teams. Hence teamwork and strong collaboration skills are a must to build.
3. Communication / Presentation
Having strong communication & presentation skills help you create a compelling product pitch and enables you to create the desired messaging or positioning of your products, which is a crucial factor to define how well your product would be received in the market. If you can communicate the key message & USP of your product or category quite well, you will surely be able to grow the category. Good presentation skills also help while explaining the products to your customer and channel partners. To build this one can practice first finding the key features or benefits of the product and then writing a short description of the solution it’s offering.
4. Data Analyzing
Analyzing data or insights to determine industry and consumer trends is an important skill that one should have or can build to be a product manager. While different tools (like MS Excel, Tableau or Power BI) can help you read & present data, you should be able to analyze the data & make sense out of it.
For instance: one can analyze customer purchase data of a company to identify key user trends/purchase patterns to identify any sales promotion strategy or to identify if there is any product gap in your portfolio. Then the data needs to be mapped with the market insights & customer feedback that a PM has collected to take any business decision. By doing so one can identify huge opportunities to grow the business. Hence data analysis has become the key important skill in today’s time.
Thanks so much for reading this post or watching the video.
Lessons from Product Management 