What is Potential Product?
The potential product, situated as the fifth level within the product marketing framework, encompasses all the prospective modernizations and transformations that a product could potentially undergo in the future.
It serves as a forward-looking concept that includes all the possible improvements and enhancements a product might experience. This idea is crucial for businesses aiming to stay competitive and retain their market position.
In essence, the potential product prompts organizations to consider what could be accomplished and what may become possible in the future. It encourages forward-thinking strategies, innovation, and adaptability to evolving consumer needs and technological advancements.
While challenging to predict with certainty, the potential product allows companies to prepare for the ever-changing market landscape and consumer demands, positioning themselves for sustained success and growth.
Characteristics of Potential Product
The key features of a potential product include the following:
Read More: 20 Characteristics of a Product
- Future-Centric: The potential product is all about looking ahead. It focuses on what a product could become in the future, considering advancements in technology, changing consumer needs, and emerging trends. It’s like envisioning a product’s evolution to stay relevant and appealing.
- Innovation Playground: Think of it as a playground for innovation. It encourages businesses to experiment with new ideas, features, and technologies that could make their product more exciting and valuable. It’s like a creative workshop for product development.
- Competitive Edge: Embracing the potential product gives a company an edge in the market. By anticipating future customer demands and staying one step ahead of competitors, a business can establish itself as a leader and maintain a strong market position.
- Adaptability: The potential product embodies adaptability. It allows a company to adjust to changing circumstances and customer preferences. It’s like having a roadmap for adapting your product to stay relevant and meet evolving needs.
Read More: Core Product – Definition, Features
The Five Levels of Product
As mentioned above the potential product is one of the products in five levels of product. This five-level product framework is provided by Philip Kotler, let’s shortly look at them.
- Core Benefit: This is the cake’s delicious taste. It’s the fundamental thing customers want. For a phone, it’s communication.
- Generic Product: Think of this as the cake’s basic ingredients, like flour and sugar. It’s what makes the core benefit possible, like a phone’s hardware.
- Expected Product: These are the standard toppings on your cake, like icing. Customers anticipate them, like a phone having a touch screen.
- Augmented Product: These are the extra goodies on the cake, such as sprinkles or filling. They make your product stand out, like a phone offering a free case.
- Potential Product: This is the cake’s future potential. Maybe one day it’ll have even fancier toppings or flavors. Similarly, a phone might get new features.
Read More: Generic Product – Definition
Examples of Potential Products
Let’s further illustrate the concept, here are 10 examples of potential products: These examples demonstrate how businesses can leverage the concept of potential products to stay innovative, competitive, and adaptable to emerging trends and customer preferences.
- Smart Home Ecosystem: Anticipating future trends, a company develops a comprehensive smart home system that seamlessly integrates with upcoming IoT devices, ensuring long-term compatibility.
- Electric Vehicle (EV) with Advanced Battery Tech: An automobile manufacturer expects an electric car equipped with cutting-edge battery technology, allowing for longer ranges and faster charging, meeting the evolving demands of eco-conscious consumers.
- AI-Powered Healthcare App: A healthcare tech startup plans to enhance its app by incorporating advanced AI algorithms that can diagnose a broader range of medical conditions accurately.
- Renewable Energy Solutions: A clean energy company explores the potential of harnessing new renewable energy sources, like underwater turbines, to expand its portfolio and address future energy needs.
- Sustainable Packaging Materials: A packaging company invests in research to develop innovative, eco-friendly materials that can replace traditional plastics, aligning with growing environmental concerns.
- Personalized Education Platforms: An ed-tech firm envisions a learning platform that uses AI to adapt to each student’s unique learning style, ensuring effective education in an ever-evolving digital landscape.
- Virtual Reality (VR) for Tourism: A travel agency looks to create immersive VR experiences that allow customers to virtually explore destinations before booking trips, capitalizing on the future of travel planning.
- Space Tourism Packages: A forward-thinking travel company designs space tourism packages, preparing for a future where civilians can journey beyond Earth’s atmosphere.
- Eco-Friendly Fashion Materials: A clothing brand invests in developing sustainable, biodegradable fabrics to meet the growing demand for environmentally conscious fashion.
- Blockchain-Based Financial Services: A financial institution explores the potential of blockchain technology to offer secure, decentralized financial services, anticipating shifts in the banking industry.
Read More: Expected Product – Definition
Benefits of Potential Product
Let’s explore some benefits that potential products could bring to businesses:
Future-Proofing Innovation
Developing potential products allows businesses to stay ahead of the curve by envisioning and preparing for what customers will need in the future. This proactive approach positions the company as an industry leader, ready to introduce innovative solutions that cater to evolving demands. By anticipating customer needs, businesses can create products that stand the test of time, securing a competitive edge.
Diversified Revenue Streams
Embracing potential products opens doors to new revenue streams. By continuously expanding the product portfolio, businesses can tap into various market segments, reducing dependence on a single product. This diversification helps mitigate risks and economic fluctuations, ensuring consistent income even as consumer preferences change.
Read More: Actual Product – Definition
Enhanced Brand Reputation
Crafting potential products that align with emerging trends and consumer expectations supports a business’s reputation. Being at the forefront of innovation communicates the company’s commitment to providing value and meeting evolving customer needs. This positive reputation fosters trust and loyalty, attracting new customers and retaining existing ones.
Cultivating an Innovative Culture
The process of developing potential products fosters a culture of innovation within the organization. Encouraging teams to think creatively and envision future possibilities results in not only breakthrough products but also a more adaptable and forward-thinking company overall. This culture empowers employees, boosts morale, and positions the business as a driver of change in the industry.
Seize Market Opportunities
By exploring potential products, businesses can identify and capitalize on emerging market opportunities. They can tailor offerings to address gaps or unmet needs, effectively becoming trendsetters rather than followers. This agility ensures the company is well-positioned to capture new market segments and expand its customer base.
Read More: Augmented Product – Definition
Strategies For Potential Product
So far we understood what potential products are, their benefits, and examples – now, let’s explore some strategies using which you can create potential products that bring success to your business.
Customer-Centric Innovation
Begin by listening to your customers closely. Understand their pain points, desires, and evolving needs. Just as a chef creates a menu inspired by the tastes of their diners, tailor your potential product to align with what your customers truly want. This ensures your offering resonates with them and solves their problems effectively.
Read More: Business Buying Behavior – Definition
Agile Development
Adopt an agile approach to product development. Rather than following a rigid plan, be flexible and iterative. Continuously gather feedback and make improvements as you progress, much like a restaurant chef refining a recipe based on customer reviews. This iterative process allows you to adapt to changing market dynamics and stay ahead of the competition.
Cross-Functional Collaboration
Just as a diverse team in a restaurant kitchen can produce a variety of flavors, collaborate across departments in your organization. Involve marketing, sales, design, and engineering teams to pool their expertise. This multidisciplinary approach fosters innovation and ensures that every aspect of your potential product, from its features to its presentation, is carefully considered.
Market Validation
Before fully committing resources, validate your potential product’s viability in the market. Create prototypes or minimum viable products (MVPs) to test the waters. Much like a chef might offer a special dish as a limited-time trial, these prototypes allow you to gauge customer interest and gather valuable feedback. This minimizes risks and maximizes the chances of success.
Read More: 6 Steps in Market Research Process