We’ve been talking about strategy: what it is, what it looks like when it’s bad, what it looks like when it’s good, and what its purpose is. Now let’s talk about the difference between product strategy and business strategy. Marty Kagan distinguishes them thusly:
Business strategy is about identifying your business objectives and deciding where to invest to best achieve those objectives. For example, moving from a direct sales model (your own sales force selling directly to customers) to an online sales model (your customers buy from your site) is a business strategy. Deciding whether to charge for your services with subscriptions or transactions fees or whether you have an advertising-based revenue model is a business strategy. Deciding to move into an adjacent market is a business strategy.
The product strategy speaks to how you hope to deliver on the business strategy.
Next up: product strategy is about leverage.