For Qualtrics's CustomerXM product, should we invest more in developing industry-specific solutions or expanding cross-industry capabilities to appeal to a broader market?

Introduction

The trade-off we're examining today is whether Qualtrics should invest more in developing industry-specific solutions for CustomerXM or expand cross-industry capabilities to appeal to a broader market. This decision is crucial for Qualtrics' product strategy and market positioning. I'll analyze this trade-off by considering the product's current state, potential impacts, key metrics, and experimental approaches to validate our hypotheses.

Step 1

Clarifying Questions (3 minutes)

• Business Context: I'm thinking about Qualtrics' current market position. Could you share how our revenue is currently split between industry-specific and cross-industry solutions?

Why it matters: Helps understand the current balance and potential for growth in each area Expected answer: 60% industry-specific, 40% cross-industry Impact on approach: A more balanced split might favor expanding cross-industry capabilities

• User Impact: Based on our customer feedback, I'm assuming certain industries have more specialized needs. Can you tell me which industries are currently driving the most demand for customized solutions?

Why it matters: Identifies high-value verticals for potential industry-specific development Expected answer: Healthcare, finance, and retail are top demanding industries Impact on approach: Would prioritize these industries for specialized solution development

• Technical Feasibility: Considering our current architecture, I'm thinking about the effort required for each approach. How modular is our current CustomerXM product?

Why it matters: Determines the ease of developing industry-specific modules vs. expanding core capabilities Expected answer: Moderately modular, with some industry-specific features already in place Impact on approach: Higher modularity would favor industry-specific development

• Resource Allocation: Looking at our team structure, I'm curious about our current capacity. How are our product and engineering teams currently organized – by industry or by cross-functional capabilities?

Why it matters: Influences the ease of pivoting resources to either approach Expected answer: Mix of industry-focused and cross-functional teams Impact on approach: More industry-focused teams might favor industry-specific development

• Timeline and Market Pressure: Considering market dynamics, I'm thinking about the urgency of this decision. Are there any upcoming market events or competitor moves that are driving this trade-off discussion?

Why it matters: Helps prioritize short-term vs. long-term strategy Expected answer: Increasing competition in certain industries, but also growing demand for versatile solutions Impact on approach: Imminent competitive threats might push towards industry-specific focus