If you work in financial services, you may view your central challenge as balancing profitability and growth against cost cutting and risk reduction. But from a member perspective, these concerns don’t register as significant. To consumers, financial products and services today are largely undifferentiated, making it almost impossible for members to find out if an offering is going to fit their needs. Because of this, pricing and terms have become the main purchasing criteria, especially for personal banking. Yet, pricing and terms don’t inspire loyalty or help members feel their needs are being addressed. Your products and services are more like commodities. How can you escape the commodity trap? Take a closer look at how your products and services relate to your members’ “jobs to be done.” Why is product development specifically challenged by the commodity trap? Product managers face three major challenges in designing new products that achieve both profitability and market share growth:
- How to generate additional value for members
- How to limit or decrease costs and inefficiencies in the product and its usage
- How to ensure the final product works in all target markets, segments and contexts.