CREATING

A PRODUCT
BUSINESS
CASE

HOW-TO GUIDE
 Creating a Product Business Case
HOW-TO GUIDE

A Product Business Case is a plan written to justify a corporate product investment. It is common
for an organization to recognize an opportunity to exploit with a new product, but the develop-
ment of that product is outside of the budget. Perhaps funds do exist in the budget for new
product development, but there is uncertainty or skepticism about the decision to invest. The
Product Business Case becomes the mechanism for quantifying the opportunity and the risk, so
the organization can make a quality decision about proceeding.

This How-To Guide outlines what a Product Business Case is, describes the key concepts for
creating an effective one and presents an action plan for doing yours.

Download the Demand Metric Product Business Case Template to guide you
through the process outlined in this guide.

The Product Business Case Defined

A Product Business Case is a formal document that contains the necessary information to enable
the business to make a decision about investing in a product development effort. A good Product
Business Case is thoroughly researched and provides all the relevant information presented in an
easy-to-understand, accessible format to convince decision makers to invest. The Product Busi-
ness case therefore will include sections that detail.

What the product is: a precise definition of the product.

Who the product is for: the target market segments and their sizes for which this product is ideal.

Why it is needed: a description of the market need that compels the organization to develop a
product to address it.

How it will compete in the market: how the product will enter and compete in the market against
existing and expected competitors.

Financials: a forecast of the revenue, profit & loss and how long it will take to break even on
investing in developing this product.

2 CREATING A PRODUCT BUSINESS CASE HOW-TO GUIDE

Product Business Case Fundamentals
Apply the following core concepts to develop an effective, credible Product Business Case:

Research — The best Product Business Cases are well researched. Conduct thorough research
to find objective, industry information that supports your business case. The more third party,
objective data you can find and include, the more credible your business case becomes. Quan-
titative data is excellent, but also include qualitative data, particularly if it comes from an industry
expert or respected source.

Narrative — A Product Business Case tells a story about how you will bring a product to life;
it is not a checklist. Therefore, the readability of the document is important. Different authors
often write different sections of the business case, so make sure all sections have good internal
consistency because they are highly interdependent. For this reason, designate one person to
edit the entire document.

Objectivity — A business case is an objective and fact-based document, so make sure that you
address both the up side and down side of the product investment. The temptation is to only
cover the upside in your business case, but doing so will cause decision makers to doubt the
credibility and completeness of your business case. If research reveals negative data, don’t
ignore it; rather, include it in your business case and present an argument for how your product
will mitigate any negative research findings.

Format — Make your Product Business Case accessible to the many people who will read it
and influence its acceptance. Bring it to life with graphics, tables and figures. Use headings
and sub-headings to organize the text. Avoid a document that consists of multiple pages of
unbroken text.

Download the Product Business Case Template to document your business case,
using the following set of steps to complete it:

Bottom Line
The discipline of your product planning process will help you avoid the critical design, develop-
ment and launch flaws that can cripple a new product. Regardless of how compelling the oppor-
tunity or innovative the product, there are flaws. The rigor of your planning process will help you
detect them, mitigate the risks, identify the critical success factors and make the best possible
decision you can make based on the available information.

3 CREATING A PRODUCT BUSINESS CASE HOW-TO GUIDE

 Action Plan
STEP 1 - Identify

1 Identify Know the Market Oppor-

tunity You Are Targeting

Identify the market opportunity or

2 Develop
need this product will address.
Provide an opportunity
statement that explains the
nature of the opportunity or
3 Determine underlying need the product
will address.

Discuss in detail the market

for this product, its size and
4 Competition expected growth.

In this section, it is important that

you not only state the facts, but
also your insight on why this is the
5 Present right market and from where the
initial customers will come.

6 Complete

Market Requirements Document

7 Write
VIEW RESOURCE

4 CREATING A PRODUCT BUSINESS CASE HOW-TO GUIDE

 Action Plan
STEP 2 - Develop

1 Identify What Is Your Competitive

Advantage and
Uniqueness?

2 Develop
Develop positioning, pricing and
a product marketing strategy
for the product. As you do
so, ensure that you create a
3 Determine competitive advantage by
exploiting the uniqueness and
differentiation this product will
have when it is launched.

4 Competition
PRODUCT MARKETING PLAN
Playbook & Toolkit

5 Present
Follow this simple step-by-step playbook to develop a product
marketing plan that achieves your goals for a product.

Product Marketing Plan Playbook

VIEW RESOURCE
6 Complete

7 Write

5 CREATING A PRODUCT BUSINESS CASE HOW-TO GUIDE

 Action Plan
STEP 3 - Determine

1 Identify Have Consistent Objectives

for Your Product Launch

Determine a set of objectives

2 Develop
this product should achieve
when it is launched. Your
objectives for this product
should have consistency with the

3 Determine corporate strategy and vision.

Typical objectives for a

product include revenue,
market share, profit, initial
orders or market leadership
4 Competition
perception. Recognize that
some of these objectives
conflict with each other.

5 Present

6 Complete
Product Development Strategy Scorecard

VIEW RESOURCE

7 Write

6 CREATING A PRODUCT BUSINESS CASE HOW-TO GUIDE

 Action Plan
STEP 4 - Competition

1 Identify What Is Your Competitive

Advantage?

Identify who and what will

2 Develop
compete with your product.
Research the specific strengths
and weaknesses of each
competitor, indicating the
3 Determine advantage you have over each.

Once your product is launched,

describe the anticipated
competitive response and

4 Competition how you will maintain your

competitive advantage.

Avoid the trap of assuming there

is no competition just because
there is not another company
5 Present that will compete directly with
you; in this case, the competition
is the status quo.

6 Complete

7 Write Competitive Analysis Tool

VIEW RESOURCE

7 CREATING A PRODUCT BUSINESS CASE HOW-TO GUIDE

 Action Plan
STEP 5 - Present

1 Identify A Detailed Customer

Profile Helps You Reach
Your Target

2 Develop Present a detailed customer

profile that describes the target
customer you need to reach
with your product development,
communications and PR efforts.
3 Determine
The purpose of this profile is to
understand when, why and how
a buyer will buy your product.

In this section of your busi-

4 Competition ness case, you will explore the
differences, if any, between the
purchaser, recommender and
user of your product.

5 Present You should also describe the

purchase process, documenting
each phase and estimating its
duration as illustrated in this
example:

6 Complete

7 Write

VIEW RESOURCE

8 CREATING A PRODUCT BUSINESS CASE HOW-TO GUIDE

 Action Plan
STEP 6 - Complete

1 Identify Determine Your Break-

Even Analysis and Risk
Assessment

2 Develop Complete a break-even analysis

and risk assessment for the
product. Present all the under-
lying assumptions, such as
product pricing, margin and a
3 Determine
sales forecast. Furthermore, it is
useful to discuss how sales will
occur, whether using existing
sales channels or through new

4 Competition ones. If the latter, discuss the cost

of developing any new channels
required to sell the product.

In addition to the financial detail

you provide here, include a
5 Present
Product Development Budget in
this section.

6 Complete

Product Development Budget

7 Write
VIEW RESOURCE

9 CREATING A PRODUCT BUSINESS CASE HOW-TO GUIDE

 Action Plan
STEP 7 - Write

1 Identify Complete Your Product

Business Case & Executive
Summary

2 Develop Write the Executive Summary

section of your business case
last, but place it first in your
document.

3 Determine Summarize the key

conclusions made in each
section of your business case
document, and include your
overall recommendation for
4 Competition proceeding with development
of the product. Include
a timetable for product
development and launch.

5 Present

6 Complete
Product Business Case

VIEW RESOURCE

7 Write

10 CREATING A PRODUCT BUSINESS CASE HOW-TO GUIDE

 About ANA

The ANA (Association of National Advertisers) makes a difference for

individuals, brands, and the industry by driving growth, advancing the
interests of marketers and promoting and protecting the well-being of the
marketing community.

Founded in 1910, the ANA provides leadership that advances marketing

excellence and shapes the future of the industry. The ANA’s membership
includes more than 1,000 companies with 15,000 brands that collectively
spend or support more than $400 billion in marketing and advertising annu-
ally. The membership is comprised of more than 750 client-side marketers
and 300 associate members, which include leading agencies, law firms,
suppliers, consultants, and vendors.

Further enriching the ecosystem is the work of the nonprofit ANA

Educational Foundation (AEF), which has the mission of enhancing the
understanding of advertising and marketing within the academic and
marketing communities.
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