As a term, productization is familiar to entrepreneurs, but the process often seems difficult, foreign, or even mystical. What is productization and what makes it worthwhile?

The aim of productization is simply to make your product or service easier to purchase and sell, which means increasing your turnover and improving your profitability. In practice, it means the development of services, which comprises service specification, design, and standardization.

The productization of a chosen service (or product) begins with specification, where you seek to identify how the sold service stands out from among the competition:

• What is the content of the service? What is the core service and the related support and add-on services?
• What is the customer’s problem that is solved by service?
• What is the service promise given to the customer?
• What is the marketing potential of the service and the estimated sales volume?
• How much does the service cost?

A customer perspective is difficult to access without asking the customers. By working together with your customers during the productization process, you can ensure that the resulting service is actually useful to the customers and brings them additional value.

Include the customer perspective in the development of your activities 

When the service contents have been designed in a customer-oriented manner, you can turn your focus on the internal processes of your business, i.e., how the service is produced and provided. 

• How does the service process proceed; what working stages does service production comprise and what is the order they have to be completed in?
• Who participate in the process?
• What technologies and work contributions are needed?
• What working stages are shared between different services?

While you are developing processes that are internal to your business, you should always keep in mind how the customer views the activities. For example, does it matter to the customer whether they have a single contact person at the company, or can there be more than one contact person without compromising the customer experience? Or how significant is delivery time or service location to the customer?

Standardization is one of the objectives of productization, and it can prove tricky, especially if your business sells customized service packages to customers. Standardization does not mean that you cannot offer customizable services. Standardization refers to standardizing certain things in different parts of the service such that they can be repeated and duplicated. This could include the operations model used with customers or the use of a certain technology in production. This removes the need to keep reinventing the wheel and means that your activities are less tied to personnel. Standardization saves a lot of time and frees resources that can be used elsewhere.

Productization becomes visible through concrete deliverables used to package your services. Service descriptions written in a customer-oriented manner and high-quality sales and marketing materials facilitate and increase sales. Marketing to your customers becomes faster and easier as well when your materials have already been packaged. Materials that are good from the customer’s point of view reduce obstacles to purchase and make purchase decisions easier. The customer satisfaction also increases, as your customers feel they get better value for their money.

Good reasons for productization:

• Increased turnover and better profitability.
• More efficient use of time allows you to focus on other things.
• Sales and marketing communications become easier.
• Purchasing becomes easier for customers.
• Increased customer satisfaction.
• Development of your company’s activities becomes easier.