Product Marketing and Product Management:
What is the Difference?
December 2003 - BEK Best Practices Newsletter
Do you know the difference between product marketing and
product management? Do you know what happens when the two
roles are combined into one? In companies where both product
management and product marketing are working well, these
two organizations are highly collaborative, with leaders
that communicate with one another. However, in smaller companies
with tighter budgets, the roles of product management and
product marketing have been blurred, and one person may
perform both functions.
The most clear distinction between the two functions is
that product management is internally focused, and product
marketing is externally focused. A product manager must
communicate that “I have a feature that does x.”
And a product marketer must say “X features provide
Y benefits;” in other words the value proposition
to the end customer.
Product management
Product managers are responsible for leading the
long-term development and direction of a company’s
products and/or services to meet the needs of worldwide
markets for both new and existing products. Real-world customer
data remains the best strategic foundation for product management.
You need to gather customer feedback before you create
and define the feature set. You must answer the questions:
What are my customers pains? What is the value to the organization?
Why will companies buy it? What will they pay for it?
To do this, you need to wear the hat of the customer and
walk in your customer’s shoes. How do they work? How
do they think? To accelerate this process, the more savvy
companies today are bringing vertical industry expertise
in-house—for example, managers that have worked in
financial and health services for 10 -20 years—in
order to gain the market knowledge necessary to penetrate
these markets.
Product managers require certain skills, including:
- A technical degree and/or technical experience specific
to the space, such as software or hardware for high tech
and medical for biotech or pharmaceutical
- Strong technical and business analysis skills in order
to quickly assess and remain abreast of the state of the
industry
- Ability to synthesize promising new technologies, new
applications of technology, standards activities, changes
in buyer behavior and expectations, and strategic vendor
positioning moves
- Excellent interpersonal skills to quickly gather and
distill information to build relationships with strategic
customers, vendors and with key internal personnel
- Ability to evangelize and champion your products and
services within the company
- Fundamental understanding of financial planning and
analysis, pricing, product line P&L, margins, costs
and inventories*
Product marketing
Product marketing managers are responsible for
leading the corporate marketing objectives globally. You
communicate the company proposition to the marketplace and
provide marketing support to your channels. Under this umbrella,
you have the responsibility for competitive analysis, product
messaging, packaging, and pricing of the product.
You also play a major role in collateral development and
other marketing and sales support activities, including
customer visits and trade shows. Product marketing managers
partner very closely with product managers as the product
managers are the product experts, especially for new products
and services.
The product marketing manager plays a critical role creating
and rolling-out product marketing plans. The documentation
that needs to be created may include:
- Pricing analysis, including bundling and services options
- Product launch plans
- Product collateral definition and development
- Internet product marketing planning
The product manager will work closely with the product
marketing manager, especially when it comes to competitive
analysis, positioning, packaging and pricing. Competitive
analysis is an on-going activity, one that many companies,
don’t do often enough. The product marketing manager
should be updating the competitive landscape frequently,
monthly if possible, or at the very least once a quarter.
(for an in-depth look at competitive analysis, see our October
Newsletter).
Without a solid product offer and packaging and pricing
of a solution, it is hard to provide key messages for a
sales team to articulate to prospects. The product marketing
manager, working with the product manager, needs to create
the right set of products, product bundles, and services
to the marketplace. Each product may have its own unique
pricing strategy or follow an overall company pricing strategy.
Regardless, the product marketing manager needs to understand
the value of the product and service to the customer, the
price the market will bear, the cost of the product and
service to the company and have the skills to work with
the financial organization so that targeted revenues, gross
margins, market share, etc. can be achieved.
Product marketing managers require certain skills, including:
- High degree of customer focus
- Marketing communication skills both written and verbal
- Analysis skills for market research and analysis and
competitive analysis
- Capable of developing detailed business, product and
marketing plans in support of new programs as well as
line extensions
- Understand different marketing strategies and tactics,
ability to align strategies to different market segments
- Capable of technically understanding products –
depending on company products
- Ability to evangelize and champion your products and
services externally with customers, prospects, partners
and analysts
- Fundamental understanding of financial planning and
analysis, pricing, product line P&L, margins, costs
and inventories*
When You Wear Both Hats
Today, especially in many small to mid-size companies
a single person fills the role of product marketing and
product management. This can be due to management beliefs,
resource availability or a combination of both. There is
no right or wrong here. It is a matter of what works best
for your company in your current state.
When a company has one person doing both product marketing
and product management many things get done more efficiently
and a number of things don’t get done at all or to
a lesser degree. This is a factor of time as well as skills
(generally speaking). Some of you can successfully do both
roles from a skill set perspective but time is always a
factor as you are doing work that has both an internal and
an external focus simultaneously. What generally happens
in this case is that for a while you are totally focused
internally and then for a stretch of time you switch hats
and start working externally.
The Voice of the Customer
No matter whether your company has the luxury of
dividing these roles among two people or if you do it all
yourself, remember that the activities you perform as an
executive of product marketing or product management or
as an individual contributor are absolutely critical roles
in the overall success of your company. You are the voice
of the customer and you should communicate what your customers
are saying internally and externally so that you develop,
acquire, or provide the appropriate products and services
to meet their needs and you can effectively communicate
to them what you have to offer them and how it will help.
Your contributions have direct impacts to the top and bottom
line of your company.
Please feel free to send us your new product
stories and questions. We encourage you to forward this
email to others using the link below.
For more information, contact BEK Enterprises
at:
Web: www.bekteam.com
E-mail:
Phone: 650-631-2800
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Copyright
Unless otherwise attributed, all material is written
and edited by
Blair Koch, BEK Enterprises. All rights reserved. 2003
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