Productization

I recently heard a talk by a senior officer from my company (let's call him John Doe) on his vision for our products and services. He drew a comparison to Apple, and coined a concept he called 'productization.' This is how he explained it.

A couple of years ago, he felt that he should go buy an MP3 player. He went to the obvious choice - an apple store. There was an apple associate that greeted him - not just any electronic store sales guy, but a person who had the right combination of 'geekiness' and 'likeability,' to inspire respect from the customers. John could tell that this guy had a lot of passion for Apple, and its products.

Typically, the sales guy would take the customer right to the product. But this salesperson took John over to a mac, and showed him iTunes - the store where one can buy a song for a buck, and the moment when one plugs in the ipod, it is automatically synchronized. Next, the salesperson took John to the genius area - the part of the store where you can bring in your ipod or laptop, and ask any sort of question to the experts, who know all about apple technology. And in fact, you can schedule the appointment online or over the phone, so that you have a guaranteed slot when you do come in! Next, he took him over to the accessories area for the ipod - with cases, earphones, and speakers which can be used to play the music at home, in the car etc.

Now at this point John had not seen the product - the ipod. However, he was ready to buy it there and then. He didn't care how the product looked like, or how much it cost him! This is 'productization' - adding great service and the right complimentary products, to a a solid product, which makes the value proposition of the whole ecosystem so compelling.

This experience had its impact two years down the road. John's old dell laptop crashed. All he needed to do, was to buy a low-end Dell laptop for $400. However he went to the apple store to see the Mac notebooks, and happily shelled out $1600 for a Macbook Pro. And he is very happy that he made the decision to spend four times as much for similar configuration, but superior design, service and complementary products. All's well that ends well (atleast for Apple).