By Marty Cagan · svpg.com · LinkedIn
Marty Cagan argues that internal products, while worth treating as real products, carry a lower bar on value, usability, feasibility and viability than commercial products. Internal users cannot switch to competitors and can be trained, whereas commercial products must beat alternatives enough to win customers. Because of this, the commercial product manager must be deeply immersed in marketing, sales, monetization and competition. The essay concludes that product discovery is often the difference between success and failure for commercial products, especially in the AI era.
01Key takeaways
- Internal products still deserve real product rigor, even though their risk bar is lower.
- Commercial products must be clearly better than alternatives to earn customer switching.
- Captive internal users change value and usability risks; commercial users can always choose elsewhere.
- Commercial PMs need deep involvement in go-to-market, monetization and compliance, not only solving the user problem.
- Strong product discovery is often what separates success from failure for commercial products, especially with AI competition.
02Key sections
- Why internal products are still products
- Internal tools, productivity software and platform services support paying customers, so they deserve product treatment rather than second-class status. The same four risks apply, even if the bar is lower.
- Where the bar differs
- Internal products face easier value, usability, feasibility and viability constraints because users are captive and the scope is narrower. Commercial products face the opposite dynamic.
- The competitive reality of commercial products
- Commercial products must outperform alternatives enough to trigger switching, a battle that intensifies as AI lowers barriers for new competitors. Solving the problem alone is not sufficient.
- The PM role changes in the marketplace
- The commercial PM must engage with marketing, sales, funding, legal and compliance, a far broader scope than the domain-focused internal PM role. Many PMs have never fought in the open market.
- Discovery as the decisive skill
- Given the stakes, product discovery is critical for commercial success. The author urges PMs to apply their full discovery skills to win in the marketplace.
03From the post
“Internal Products Are Hard; Commercial Products Are Harder We have spent a lot of time trying to convince product people and especially product leaders of the importance of internal products. We’re talking about services or solutions that are used by our own employees to take care of our customers (e.g. customer-enabling tools and services), or... The post Commercial vs Internal…”
Summary and takeaways written by PM Atlas; quotes are short excerpts. © the original author.