Shape Product Strategy

Turn market material into a bounded strategic choice. Do not produce a broad catalogue when the decision requires a focused recommendation.

Frame the strategic decision

State:

• the decision owner and deadline;
• the product, geography, customer, and time horizon;
• the company objective and non-goals;
• the current product and market stage;
• hard constraints, distinctive assets, and missing capabilities;
• what choosing one direction prevents or delays.

Separate user-confirmed facts from external market material. Verify current product, price, policy, and market claims using primary sources when possible.

Model the system from first principles

Describe the market as a value system:

1. Actors: users, buyers, payers, operators, suppliers, regulators, partners, and substitutes.
2. Value carrier: product, service, capability, data, access, risk transfer, or outcome.
3. Context: trigger, workflow, channel, frequency, urgency, and switching environment.
4. Enablers: technology, infrastructure, distribution, standards, policy, and capital.
5. Exchange: who gives what, who receives value, who bears cost and risk.

Treat industry frameworks as lenses, not conclusions. Rebuild the logic when the category boundary or market structure does not fit the framework.

Choose a market and customer

Segment using variables tied to the strategic objective, such as:

• problem intensity and frequency;
• willingness and ability to pay;
• acquisition and service cost;
• workflow or scenario;
• risk and compliance requirements;
• switching cost and incumbent alternative;
• strategic fit and reachable distribution.

Require a segment to be meaningful, measurable enough, reachable, actionable, and large or valuable enough for the intended model. For concentrated B2B markets, map decision makers, users, payers, evaluators, implementers, veto holders, and affected parties.

Analyze competition by purpose

Define why competition is being studied before selecting competitors:

• industry entry and market selection;
• positioning and long-term direction;
• feature, experience, or technical decisions;
• pricing, distribution, growth, or go-to-market.

Include direct competitors, different solutions to the same need, alternatives competing for the same budget or behavior, and useful reference products. Compare the mechanism behind results, not only visible features.

Read references/strategy-toolkit.md for the comparison matrix, industry lenses, and business-model tests.

Design the business model

Make the model explicit:

• target customer and underserved condition;
• value proposition and proof;
• product or service offered;
• key capabilities, resources, data, and partners;
• acquisition, delivery, support, and retention;
• payer, price metric, revenue timing, and incentives;
• fixed, variable, operational, risk, and exit costs;
• unit economics and cash-flow timing;
• stakeholder benefit and harm;
• conditions required for the model to become self-sustaining.

Do not assume free, platform, long-tail, subscription, advertising, or cross-subsidy models are superior. Test whether each side receives enough value, whether the subsidy is fundable, and whether the model survives without misleading users or trapping them.

Build strategic options

Develop a small set of materially different options, including “do nothing” or “delay” when relevant. For each option, show:

• target segment and problem;
• unique value mechanism;
• required capabilities and missing resources;
• revenue, cost, and operational model;
• differentiation and likely response from competitors;
• major assumptions and failure modes;
• time to learn, time to value, and reversibility;
• minimum credible proof.

Use elimination-reduction-increase-creation or cost/differentiation/focus only as prompts for option generation. Do not label an option a blue ocean without evidence of new demand and a credible value-cost change.

Select and stage the strategy

Recommend an option only after comparing:

• customer value;
• business value and economics;
• strategic fit;
• feasibility and operating burden;
• risk, regulation, and ecosystem dependence;
• defensibility;
• speed and cost of validation;
• opportunity cost.

Define the first liquidity unit, wedge, or minimum strategic loop. Name the phase-one proof, expansion trigger, stop condition, and capabilities that must be built before scaling.

Apply research and ethics boundaries

Use lawful public information, authorized product access, disclosed interviews, and legitimate expert engagement. Never use fake recruitment, sham procurement, impersonation, unauthorized system access, confidential-information solicitation, product backdoors, or deceptive pretexts to obtain competitor information.

Reject business models that depend on hidden fees, false scarcity, fabricated authority or social proof, involuntary continuity, unauthorized data use, artificial lock-in, or harm shifted to a less visible stakeholder.

Deliver the decision

Provide:

1. strategic decision and scope;
2. current facts, market material, and unresolved conflicts;
3. system and competition model;
4. options and explicit assumptions;
5. selected position and business model;
6. capabilities, costs, and high-cost compromises;
7. staged validation and decision gates;
8. invalidation conditions and monitoring signals.

Keep examples and market analogies subordinate to the actual decision.