EdTech Product Managment: How to bring a product from idea to market (Qualitative)
- Robbie Geoghegan
- Dec 31, 2019
- 6 min read
Updated: Jan 1, 2020
Using an end-to-end product management methodology for a personal product idea.
APPLE SCHOOL
The US school education system lags many other developed nations and has seen declining performance in recent years. The Organization for Economic Cooperation and Development (OECD) ranks the US 31st of 70 OECD countries for average scores of 15-year-old students across Mathematics, Science and Reading – comparable with Russia (28th), Czech Republic (30th) and Latvia (32nd).
A major factor contributing to America’s poor performance is education and teacher quality. The Every Student Succeeds Act (ESSA) was passed by Congress in 2016 to address this issue and enforce minimum academic standards for all schools. However, measuring academic standards against minimum standards is largely dependent on annual tests which has confounded problems of lagging indicators of student performance and teachers teaching for test taking rather than to curriculums.
This article proposes the introduction of a new product line within Apple’s Education Product Portfolio to address this education problem: Apple School. Apple School is a software product that analyses teaching quality and student performance by capturing classroom data using a HomePod (smart speaker), iPad and/or laptop. The analysis of this data provides a much richer source of information to track school, teacher and student performance than annual testing – see below for the product overview. The article will outline considerations and decisions for Apple School from product strategy to commercialization and ‘go-to-market’.
PRODUCT STRATEGY
Apple’s mission is “to bring the best user experience to its customers through its innovative hardware, software, and services.” The Apple Education business unit’s mission is to “ignite the creativity in every student.” Apple School is strongly aligned with these missions as it improves teaching and student performance through the marriage of hardware and software. Additionally, Apple School can increase demand for Apple’s existing products by adding additional value to the HomePod, MacBooks and iPad product lines and increasing customer stickiness to those using these products in the classroom, in a similar way iTunes did for the iPod and the app store does for the iPhone.
IDEAS GENERATION
The General Electric Model comparing market attractiveness with business position was used to test the appropriate marketing approach for Apple School. Market attractiveness was measured as mid-tier due to high potential profitability and growth opportunities (see Analytics Section) but significant government regulations to navigate and price sensitivity of schools. The business position was measured as high given existing Apple products can be leveraged to support Apple School, Apple staff have very high capability in developing software and Apple has existing domain expertise from its Education business unit. Together these scores suggest an invest/ grow approach for the product.
ANALYTICS
Demand, cost, sales and profitability were considered in the Analytics phase. Demand is estimated to be high for customers (government and/ or schools). Total expenditure on elementary and secondary schools in the United States was $706 billion in 2015-2016, or close to $14,000 per student. If Apple School was licensed at less than $100 per student, this amounts to a relatively affordable amount of less than 1% of student costs. Development costs will be like that of other software products, initially high for development with low marginal costs per product sold and ongoing maintenance cost – this means the product will need significant upfront funding to be successful. Sales and profitability opportunities are large. If licensed within a range of $25 to $100 the market size for Apple School is $1.4 - $5.7 billion based on the 56.6 million elementary, middle and high school students in the US. Given the low marginal cost of software products, the profit margin opportunity is also large and attractive.
DEVELOPMENT
Product development will leverage Apple’s excellence in software development and follow their traditional approach where the project team are cut off from the rest of Apple business to focus entirely on the product.
The marketing strategy will focus on two audiences, the people in government and schools who are making school purchasing decisions and parents. The message to government and schools will be aligned with Apple’s broader innovation mission statement about how Apple can help innovate and improve teacher and student performance. The objective being to show the product’s practical value. The message to parents will be like the Education business unit’s mission to ignite creativity in every student to show the benefit for their child. It will also be tempered with considerations about data security as this is anticipated to be parent’s biggest concern as outlined in these two sources A, B. The objective for this audience is to demonstrate the benefit to their child and minimize potential concern. Specifics for implementing the marketing strategy for the introductory and growth phases are outlined in the Commercialization section.
The branding will reflect the marketing messages. Using the Apple brand in the name “Apple School” leverages all the brand equity of Apple and is associated with creativity, high performance and security – all the key elements of the marketing strategy. Packaging and labeling are not a focus given the product is software.
Promotions, places and price will also reflect the marketing strategy and key messages. As Apple School is a business product for institutions, promotion should focus around personal selling due to the formal nature of buying and concentrated number of customers. Place will leverage the existing Apple e-commerce platform and be direct to the user coupled with set-up support and optional training to help with the complex elements of the product. Pricing should include room for negotiation and reflect standard software licensing practices of annual subscription costs per seat. The pricing level will be conservative at $40 per seat per year to drive growth during the introductory and growth phase to create an economy of scale/ barrier to new entrants. The conservative price will also reduce potential PR issues of Apple taking advantage of schools and students. Pricing will be revised at the maturity phase to be more reflective of the product’s ‘value add’ to users once user information becomes available.
TEST MARKETING
This article suggests following the Agile development/ test marketing approach which tests prototypes through a limited introduction to potential customers in two ways. Firstly, free beta versions of the software will be coupled with Apple hardware purchases at schools where Apple can gather data and refine the product using real user information. Secondly, testing the product with existing users of the two main competitors Google Classroom and Microsoft Education (which overlap Apple School somewhat in student performance tracking) will be conducted to further refine the product and understand competitive advantages and disadvantages.
COMMERCIALIZATION
Commercialization will focus on three elements, production, sales force training and trade announcements. To now the article has outlined the production approach from concept to prototype, but success of this product will include ongoing incorporation of user feedback into the product design and features as well as ongoing maintenance of the platform. Direct selling and trade announcements will be used given this is a B2B product. Sales force training will be conducted so that the sales force communicates the intended message and story, can understand the complexities and benefits of the product, how it can be implemented in classrooms and restrictions from government policy. Trade announcements will target key decision makers in education. The US market will be the initial focus due to its market size, demand and to reduce complexities from launching across multiple languages and school systems. Distributions to overseas markets is planned for the growth phase.
CONCLUSION
Apple School addresses a significant problem in the US and taps into a very large potential market. The product continues Apple’s corporate mission and leverages its brand, hardware and employee core capabilities. This articletests the product at each step in the product development process and Apple School appears viable at each stage. It is important that the ongoing process continues to consider why products succeed such as: working in a project-based teams, listening to customers to incorporate their feedback and ensuring the product is best in class. Similarly, the process must be cognizant of why products fail such as: having no discernible benefit compared with existing products, poor match between features and customer desires and setting prices too high or too low. In addition, this product will need to overcome the specific and substantial risks that arise from navigating the complex, political US education system as well as managing data privacy of teachers and students. The analysis in this article suggests Apple School can further progress Apple’s corporate vision within the education industry and deliver significant profits.
SOURCES
[1] PISA Worldwide Ranking – average score of math, science and reading http://factsmaps.com/pisa-worldwide-ranking-average-score-of-math-science-reading/
[2] Apple Mission Statement and Vision Statement in a Nutshell, https://fourweekmba.com/apple-mission-statement-vision-statement/
[4] National Center for Education Statistics https://nces.ed.gov/fastfacts/display.asp?id=66
[5] National Center for Education Statistics https://nces.ed.gov/fastfacts/display.asp?id=372
[6] The New York Times: https://www.nytimes.com/2013/06/23/business/data-security-is-a-classroom-worry-too.html
Commentaires