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Strategy

Strategy Phase: From Understanding to Decisions

The strategy phase turns research data into concrete decisions: how to position, what to offer, at what price. All artifacts in this phase build on the results of the research phase — segments, Job Statements, pain map.

Competitive Landscape

Methodology: Consideration Set + Non-consumption

In Product DNA, competitive analysis is built not on features, but on the Consideration Set — the set of solutions the user actually considers before purchasing. This includes:

Competitor TypeDefinitionExample (time tracking)
Direct Solve the same Core Job Toggl, Clockify, Harvest
Indirect Solve a Related Job, sometimes covering the Core Job Notion (tables), Trello (lists)
Non-consumption User does NOT solve the task at all "Just remember", "By estimate", Excel
Non-consumption — Often the Main Competitor
40% of freelancers don't track time at all. This isn't "no competitor" — it's the biggest competitor. Transitioning from "doing nothing" to "using a product" is also a Switch that requires Push + Pull > Inertia + Anxiety.

Consideration Set: Buyer's Mental Model

The Consideration Set forms before the trigger, not after. By the time the user starts actively searching, they already know 2-3 options. Marketing must enter the Consideration Set in advance — through content, recommendations, SEO.

Consideration Set Structure
Current solution:
— Name: Google Sheets + timer
— Satisfaction level: 4/10
— Switching cost: time for data migration (2-3 hours)

Known alternatives:
— Toggl: "good at tracking, but no client reports" (learned from a colleague)
— Clockify: "free, but looks cheap" (found on Google)

Beliefs: "All trackers are the same", "Free ones = no support"
Fears: "I'll lose data during migration", "I'll get used to it and they'll shut down"

Analysis Quality Criteria

  • Competitors are evaluated by Jobs, not by features
  • For each competitor, it's noted which Jobs they solve well, poorly, or don't solve
  • Non-consumption is included as a full competitor
  • Vocabulary from interviews (DP11: "what they told others") is used for descriptions
Tips
  • Add competitor URLs in chat — AI will analyze their positioning
  • Share pricing tiers — this improves the pricing model and unit economics
  • Share what competitor users say (reviews) — for extracting pains

Positioning

Methodology: April Dunford + Product DNA Job Language

Positioning defines your product's place in the target audience's mind. AI generates positioning using the April Dunford framework, enhanced with Product DNA:

ComponentDefinitionData Source
CategoryWhat market category the product exists inNiche from context
AlternativesWhat they currently use (Consideration Set)Competitive landscape
Unique AttributesWhat differentiates from alternativesJobs that competitors DON'T solve
ValueWhat benefit the customer getsDesired outcomes from Job Statements
Target SegmentFor whom this matters mostA-segment from ABCDX

Positioning Formula

"For [target segment] who [situation/trigger], [product] is a [category] that [key differentiator]. Unlike [alternatives], we [unique value]."

Product DNA Rule: Use User Language
Positioning MUST use words from DP11 (what early users told others), not invented marketing language. If a user says "tracks time for me" — that IS your positioning. Not "innovative AI-powered work time automation platform."
Example
"For freelance designers who spend 30+ minutes per day on time tracking and invoicing, TimeFlow is an automatic time tracker that creates professional client reports in one click. Unlike Toggl, we don't require manual timer starts — tracking works via Figma integration."

Language from interviews: "tracks for me", "report in one click", "don't have to think about the timer" — all from DP11.
Context Requirements
Positioning requires at least 40% context (niche + pains + competitors). With insufficient data, the artifact will be marked as "draft." For strong positioning, you need interview data (DP11).

Value Proposition (Value Proposition Canvas)

Methodology: Value Proposition Canvas + JTBD Fit

The value proposition is built as a Value Proposition Canvas adapted for Product DNA. Both sides of the Canvas must match — this IS Product-Market Fit:

Customer Profile (right side)Value Map (left side)
Jobs: Core/Emotional/Social Jobs from researchProducts/Services: What your product offers
Pains: Pains from the pain mapPain Relievers: How the product alleviates each pain
Gains: Desired benefits (desired outcomes)Gain Creators: How the product creates each benefit

Fit Score

AI calculates a Fit Score (0-100%) — the degree of alignment between Value Map and Customer Profile. The Fit Score consists of:

  • Pain-Reliever fit: how many of the top-10 pains are covered by pain relievers
  • Gain-Creator fit: how many desired outcomes are covered by gain creators
  • Job-Product fit: how well product features correspond to Core Jobs
Example
Pain: "Forget to start the timer" → Pain Reliever: "Automatic tracking via Figma integration" → Fit: 95%
Gain: "Professional report for the client" → Gain Creator: "Auto-generated branded PDF" → Fit: 90%
Pain: "Hard to invoice" → Pain Reliever: absent → Fit: 0% (gap!)

Overall Fit Score: 72% — good, but there's a gap in billing integration.

Switch Formula in the Value Proposition

The value proposition must deliver ≥ 2x value compared to the current solution. This is the loss aversion rule from neuroscience: losses feel ~2x stronger than gains (Kahneman). If your product is only slightly better — the user won't switch, because the pain of transition (Inertia + Anxiety) will outweigh the benefit.

Offer Bank

Methodology: 5 Awareness Levels + Job Language

The Offer Bank generates advertising propositions adapted to the buyer's awareness level. Each offer is tied to a specific pain and Job Statement.

LevelProduct DNA StateOffer TypeExample
Unaware Big Job exists, work is not performed Educational content without CTA "How freelancers stop losing money on tracking"
Problem Aware Push is active, Consideration Set is empty Name the problem + show a solution exists "40% of freelancers lose 5hr/week on tracking"
Solution Aware Active search, Switch phase Activating Knowledge: why YOUR product is better "Unlike Toggl, no need to press Start"
Product Aware Comparing in Consideration Set Demo, case studies, ROI calculator "1,200 freelancers save 5hr/week"
Most Aware Push + Pull outweigh Direct offer + alleviate Anxiety "14 days free, migration in 30 seconds"
Only 3% Are Ready to Buy Right Now
Only Most Aware (3% of the audience) are ready for direct outreach. The other 97% need content, education, and getting into their Consideration Set before the trigger. This isn't "wasted marketing" — it's investment: whoever enters the Consideration Set before the trigger has no competitors at the moment of decision.

Offer Types in the Bank

  • Main headline — for landing pages and ads (in Core Job language)
  • Subheadline — value expansion through desired outcome
  • CTA — call to action (tied to a micro job)
  • Social proof — review formulations (from DP11)
  • Objection handlers — responses to Anxiety from the Switch formula
  • Activating Knowledge — phrases that update the Consideration Set

Activating Knowledge

Activating Knowledge — 3-5 phrases that change the user's mental model and trigger a Switch WITH YOUR product. Extracted from DP11 (what early users told others) and search queries for orientational jobs.

Activating Knowledge Example
Phrase: "Turns out, you can track time without a button — it counts automatically while you work in Figma"
Target segment: A (freelance designers)
Target Big Job: Build a stable freelance income
Next step: User searches "automatic time tracking Figma"
Delivery channel: Blog content, YouTube review, colleague recommendation

Pricing Model

Methodology: Three Pricing Dimensions

AI analyzes pricing through a synthesis of three frameworks. The right price lies at the intersection of all three:

DimensionFrameworkFormulaComment
Fair price Value-based pricing (Nagle & Müller, 2018): 1/10 rule Customer value ÷ 10 If saving $1,000/month → price $100/month
Switchable price Product DNA (loss aversion) New value ÷ Old value ≥ 2x Must be 2x better to overcome habit
Profitable price Unit Economics LTV ÷ CAC ≥ 3, payback ≤ 12 months Business must be economically viable
When Prices Don't Converge
If the value-based price is too low for unit economics — either the segment is wrong (need one with higher WTP), or the product isn't valuable enough (need to solve a more important Job).

Pricing Models

ModelWhen to UseExampleProduct DNA Link
FreemiumLarge TAM, virality, low ARPUToggl, NotionMicro Job free, Core Job — paid
SubscriptionRegular usage, high retentionNetflix, SpotifyFrequency = daily/weekly
Per-seatB2B, team usageSlack, FigmaVirality = shared/social
Usage-basedIrregular usageAWS, TwilioFrequency = monthly/quarterly
One-timeOne-off valueCourses, templatesFrequency = once

WTP Estimation (Willingness to Pay)

WTP is extracted from several sources:

  • DP16 (Budget/WTP signal): Direct signal from interviews — "how much do you pay now?"
  • Competitor prices: Set an anchor in the Consideration Set
  • Cost of the problem: If the problem costs the client $1,000/month → WTP = $50-300/month
  • Pre-order test: The strongest signal — real money before the product exists

Simplicity Rule

One Feature Set + 2 Billing Periods
Simple pricing wins over multi-tier plans. One feature set + 2 billing options (monthly/annual) converts better than 3-5 pricing tiers. Complexity = analysis paralysis = lower conversion. Let the time horizon, not features, create price levels.
Pricing Calculation Example
1. Cost of the problem: Freelancer loses 5hr/week × $15/hr = $75/week = $300/month
2. 1/10 rule: $300 ÷ 10 = $30/month
3. Loss aversion: Competitors (Toggl) = $10/month. Our value must be ≥ 2x → ≥ $20/month value ✓
4. Unit economics: At $10/month and LTV 14 months: LTV = $140, CAC = $32, LTV/CAC = 4.3x ✓
Result: $10/month price passes all 3 checks.
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