Low-Touch VS High-Touch Products

The type of product you choose to build has implications on everything from the customer experience to the pricing model. Let's talk about the differences and why you might choose one or the other. If you want to reach product-market fit faster, sign up for my free 5 day email course here - https://nxtstep.io/fit/ Episode Transcript Hey folks, Sean here and today what I want to talk to you about are the different type of product companies you might build. When I say different type, what I mean is low touch versus high touch. There are some key differences between the type of experience that you might create for both your customer and the type of product company that you're going to build for both yourself and your team. And I'm going to start by kind of categorizing each in terms of what are some of the more important or typical characteristics you might see in each of these and then sharing some examples with you. I also want to talk about how you can become more of one or the other as and you don't have to remain in either of those categories indefinitely. So when I say low touch product company, typically from a strategic perspective, what that means is you're creating a customer experience that is typically product led. And when I say product led, what I mean is your customer's first experience with your product is typically the product. As in they will go right into using the software and that's kind of their first experience with your product and your company. Also from a pricing model perspective, low touch products often leverage simpler models as in customers might pay the same amount on a given month or year in order to gain and maintain access to your product. Now, an example of a low touch product I would like to use is Calendly, something I've used for years. I get a lot of value out of it and it's relatively simple. Calendly, if you're unfamiliar, helps you with essentially that what can become a merry go round of trying to figure out how to get everybody synced up so they can meet at a time that's mutually available for both of them. So it helps you with managing your calendar but the use of the calendar product is rather simple. As such it fits well into the low touch product category. Now, on the other hand, a high touch product from a strategic perspective, you're usually leveraging a model similar to being Sales lead as in your customers first experience with your product is actually through your team. So they will meet with sales team or someone to figure out what onboarding them might look like or qualifying them as a prospect. Because a high touch product is typically more complex, it's got more moving parts. The whole experience is difficult to kind of just dump a customer into and enable them to be able to figure it out. Also the product itself isn't the only thing that's more complex. Almost everything is the pricing model as well as in gaining and maintaining access to a high touch product typically involves multiple components. Maybe an implementation fee may be ongoing costs. There may be contracts with commitments that may go beyond a year. So the contracts may be relatively inflexible and rigid. So those characteristics typically speak to what we consider to be a high touch product. An example of a high touch product in this instance might be something like Salesforce. If you've never used Salesforce before, it's a heavy duty CRM. But they as a company own a ton of other products as well too. So navigating kind of their environment gets complex fast. As such, some of your early contact with a company like Salesforce, if you're interested in a product like that, is usually with someone on their team. Now, like I said earlier, just because your product is delivering one or the other of these type of experiences or falls into either category, either low touch or high touch today, doesn't mean it necessarily needs to stay there. I've seen products make a successful transition from one to the other and you'll often see products trying to do that as they are kind of figuring out product market fit. So the most straightforward way to think about it, if you would like to be one or the other that's why I described those characteristics and some examples of each first, because depending upon your experience with those products or your ability to familiarize yourself with them. That may or may not be. It might become clearer for you in terms of the type of product you'd prefer to build versus the customer experience that you're looking for and the experience that you'd like for yourself and your team. There are different implications depending upon which of these two paths that you choose and you don't need to wait to choose this. I think more often than that makes the most sense to think about this almost essentially right out of the gate. But let's assume you have some traction and you have an established product with paying customers as well too. Transitioning from one to the other or taking advantage of the respective strengths of each is also possible. Now, the easiest way that I typically think about how to do that really is the core component of that is the product experience, as in how complex is it to use your product. In order for a high touch product to become more of a low touch product, you're going to have to simplify the experience. So you might need to do things like cut way back on in terms of what your product is capable of. That might mean removing features or building a new version of your product that's actually dramatically simpler than it was before. This isn't necessarily a bad strategy. There's obviously some engineering involved here. But what you can do is if you kind of got out of the gate with more functionality than you were expecting to and you have some early traction, what I'd recommend you take a closer look at is where are you having that traction? As in where are your customers the most active with using your product and what are they getting the most value out of soft, circle those features and essentially do a quick mental calculation in terms of what percentage of what your product is capable of. Are those features where they're getting the most value and using the most frequently? And can you create a simpler product experience around just those features? If you can, that's where you have great potential to convert essentially a high touch product into a low touch product. I know that. On the other hand, if you have a low touch product and you kind of want to go beyond where you are, some often may want to do that. Depending upon if they want to raise their prices or they want to scale their product company, things like that, low touch products are less likely to go further in that direction, so to speak. If that's the case, then you want to have a better understanding for how you want to contin...