Justworks Product SVP on Product Expansion
Product Expansion: More Than Just New Products
When most people think about product expansion, the first thought that comes to mind is something completely new. In other words, the product carries its own unique set of features that fall under a new brand. However, product line expansion can also introduce a new product to your core brand that expands your customer footprint. For example, this represents a new product with unique features that still falls within your original brand portfolio.
As you might expect, not many companies get a chance to do this. During my career, I’ve been fortunate to manage product expansion opportunities that fall within this category. Unlike a “completely new” product introduction, these product line expansions bring unique challenges and opportunities. For example, you can benefit from your brand’s existing reputation and cache to build credibility more quickly. However, you also face challenges with trying to understand a new audience that isn’t familiar to your brand.
Early in my career, I faced this challenge working at American Express. Within the credit world, Amex is the go-to for affluent spenders. However, during the financial crisis in 2008 and 2009 – the company saw an opportunity to get into the pre-paid market. Simply put, the company could not rely on traditional credit card consumers for new business. Furthermore, the prospects for bringing in big spenders at that time were very slim. As a result, I joined the team to introduce a new low-cost / “non-Amex” solution to attract the under-banked and “credit-averse” millennials.
While the American Express brand may be a strong draw, we quickly realized that building products for the under-banked and new-school credit card consumers were not in the company’s DNA.
In other words, the product team had no historical data or product culture to draw from in understanding this customer. Simply put, we only understood the traditional American Express customer. Given that our team’s charter was to build a pre-paid product and use it to reach new consumers, we had to start from scratch in truly learning about this new customer for American Express.
Fortunately, we had an opportunity to dig deep for six to eight months in framing our product expansion to meet the needs of the customer. Most importantly, we partnered with a company – Walmart – that had significant expertise in reaching this customer. Ultimately, they had the customer insights – and we had the technical expertise to produce a quality pre-paid product.
In summary, it’s important to understand where you lack the necessary insights to create effective product expansion solutions. Before you jump too deep into building something for a new audience, make sure you fully understand their needs. And remember – there are plenty of experts to pull in if you need some help.