Writing a Product Proposal: Comprehensive Guide & Examples

You’re confident that your product is important and will make a significant difference, but how do you make sure that your clients or team leads see its potential too?

In this article, we’ll walk you through every section of a product proposal, complete with examples to help you write each part. 

We’ll also explore four different templates for various use cases—from launching a new product to pitching a product strategy—and provide quick tips on how to personalize each one. 

What is a product proposal?

A product proposal is a detailed document that outlines the concept, strategy, and plan for introducing a new product or enhancing an existing one.

A product proposal is usually focused on answering the following questions: 

• Product differentiation: What gap in the market will your product fill?
• Unique selling proposition (USP): What makes your product stand out from competitors?
• Target audience: Who is your product for, and why do they need it?
• Problem-solution fit: Is there evidence that your target audience has a need for the product? 
• Total addressable market: What is the size of the overall market for your product?
• Pricing strategy: How does your pricing compare to competitors’ products?
• Product development roadmap: What resources (e.g., personnel, technology, funding) are required at each stage?

Physical VS digital products: how are they different?

Writing a proposal for a digital product vs. a physical one isn’t all that different. 

In both cases, your main goal is to convince stakeholders to greenlight your product by showing it’s a profitable investment (great ROI) or that it addresses an ongoing problem (“lite” version to address customer churn).

The key difference lies in how you frame sections like cost, R&D, and market analysis. Both product types present unique friction points for stakeholders.

For physical products, focus on logistics such as inventory management, production times, and supply chain efficiency. Stakeholders want to know how tangible and sustainable the product will be.

Essentially, think about answering these key points: 

• Production plan: How and where will the product be manufactured?
• Quality control: What measures will you take to ensure product quality?
• Supply chain logistics: How will you manage the supply chain from raw materials to finished product delivery?
• Profit margins: How will you price the product competitively while maintaining profitability?

For digital products, stakeholders will want details on development timelines, scalability, and user experience. With software, profitability is key, especially if you’re entering a new market and need to attract users. Including a timeline for when you expect to be profitable is a smart move for your proposal.

Think about answering things like: 

• Development timeline: What is the schedule for development stages and milestones?
• User experience: How will the product meet user needs and offer a seamless experience?
• Scalability: How can the product grow and handle increasing user numbers?
• Revenue model: How will you monetize the product and ensure sustainable profitability?

What is the structure of a product proposal?

No matter what type of proposal you’re working on, there are a few key sections that will help you structure it clearly for your stakeholders.

Let’s walk through each section below:

Executive summary

If this proposal is linked to a previous initiative (like an earlier meeting or project), make sure to reference it.

An effective executive summary should hit these points:

• Project overview: Briefly describe the product and its purpose.
• Key benefits: Highlight the main advantages and potential impact.
• Stakeholder value: Explain why this product matters to the stakeholders.
• Call to action: Clearly state what you need from the stakeholders.

Here’s an example:

“Our new smart home device, Home+, is set to revolutionize home automation by seamlessly integrating with all major appliances and utilizing AI to learn user preferences. With the smart home market projected to grow by 25% annually and 60% of current users expressing dissatisfaction with device compatibility, Home+ addresses a significant need. This innovation not only meets the growing demand for smart home solutions but also positions us as leaders in the market. We seek your approval to move forward with development, targeting a six-month launch window to capitalize on this booming market.”

Problem and opportunity

The goal of your product proposal is to articulate the problem and present it within the context of an opportunity. 

Stakeholders need clear incentives for approving projects, so your job is to justify why taking action is necessary. 

Think of framing the opportunity as either proactive or reactive.

• Proactive opportunity: This is about anticipating future trends and getting ahead of the curve. For example, if market data projects a surge in sales for a particular product category, entering that market now could be incredibly beneficial.
• Reactive opportunity: Think about responding to current challenges or gaps in the market. Maybe your data shows declining sales, disengaged customers, or high churn rates. A new product release could address these issues. 

Product overview

How detailed your product overview needs to be really depends on where you are in the approval process.

If you’re pitching a brand-new idea, it’s often better to keep the technical details brief and focus more on why this product is a smart move for your company right now. You could point out how your product fills a gap in the market that competitors have missed. 

For a new product proposal, focus on: 

• The product idea and its purpose
• The problem your product solves and why it’s needed in the market
• How this product aligns with your company’s goals and vision
• An overview of the key features, keeping it high-level

However, if the product proposal is part of a specific action plan your company is pursuing, including more detailed specs can be really helpful for stakeholders.

For product proposals involving existing products or product categories, focus on:

• The specific enhancements or new features being proposed
• Data and feedback from current users to justify the proposed changes
• A brief summary of the existing product and its current performance

Target market

In the target market section, you want to describe who the buyers or users are going to be. The typical target market profile includes:

• Who are your customers in terms of age, gender, income level, location, and other key characteristics?
• What tasks or problems are your customers trying to solve with your product?
• What are the pain points or challenges your target market is currently facing?
• How does your product address these frustrations and provide a solution?

Consider a demographics chart or a buyer profile layout to help readers visualize your target market. 

Competitive analysis and differentiation

For competitive analysis, your goal is to provide an overview of other products from competitors and identify the gap your product will fill. 

Stakeholders might be apprehensive about greenlighting a new product if the market is already saturated or if there is an obvious leader in a product category.

Your goal is to communicate how this product not only has a competitive edge but is also better or different than others. 

Use tables to quickly distinguish how your product is different from the competitors’. 

Implementation plan 

This section is all about answering, “what goes into the building of this project?”. Your goal is to show stakeholders that investing in this project outweighs any possible risks. 

Think about addressing the following sections with the following: 

• Development phase: Outline the quality control protocols, including random sampling and stress testing. Highlight partnerships with top-tier suppliers for consistent component quality.
• Manufacturing and production (for physical products): Discuss how you’ll optimize manufacturing and handle quality control. Mention the selection of reliable manufacturing partners to ensure high standards.
• Feedback and testing: Describe how this feedback will be used to identify and fix issues before the full launch. Highlight the continuous improvement loop based on user input.
• Marketing and sales: Outline your strategic pricing models and marketing initiatives to start generating revenue. Discuss when you expect to start seeing revenue, which is especially important if you’re entering a new market with zero presence. 

Impact and success metrics

The goal of this section is to provide a clear, quantifiable forecast of the benefits and returns that stakeholders can expect.

This section should highlight the strategic advantages, market potential, and financial returns of approving this project.

Think about building this section with these three key elements: 

• Market share goals: How much of the market are we planning to capture?

“We aim to capture 10% of the smart home market within the first year, leveraging our unique features and competitive pricing. This penetration will establish us as a significant player in the industry.”

• Revenue forecast: How does this product initiative contribute to our revenue?

“We project $2 million in revenue within the first year, with an annual growth rate of 20% thereafter. These projections are based on market analysis and our targeted marketing strategies.”

• User acquisition targets: How do we measure the success of our initial product launch? 

“Our goal is to acquire 50,000 users within the first six months through targeted marketing campaigns and early adopter incentives.”

Sample product proposal examples and templates

Now that you have a better idea of what goes into writing a product proposal, let’s explore some free templates that you can customize to kickstart your writing. 

Software product proposal

This software product proposal template is a great starting point for pitching mobile development projects, web applications, and software solutions in general.

One key section to really hone in on is the hardware and software requirements overview. This part outlines everything necessary to get the project off the ground, from servers and databases to programming languages and development tools.

It’s crucial to cover these details because they help clients understand the technical foundation of the project and any additional resources that might be required. 

Sections included: 

• Introduction and cover letter
• Executive summary
• Project overview 
• Hardware and software requirements
• Obstacles
• Technical obstacles
• Industry and market risks
• Budgetary risks 
• Milestones and reporting 
• Pricing and payment terms 

Physical product proposal 

This physical product proposal template includes a section to discuss features and benefits, which are the primary selling points for physical products. 

While this template is a solid starting point, adding more information about the manufacturing process or the specific reasons behind your design choices can make it even stronger, especially if you’re still seeking approval before the manufacturing process. 

Sections included: 

• Problem
• Research
• Features
• Benefits
• Purchase options

Product improvement proposal 

This product improvement proposal template is a great starting point if you’re looking to pitch changes to an existing product or explore new product marketing strategies. It covers the essentials, like cost analysis and an implementation timeline, which are crucial for justifying your proposed changes and getting stakeholder buy-in.

To make your proposal more compelling, personalize it with detailed explanations of why these improvements are necessary. For example, if customer feedback suggests that the current interface is hard to use, highlight this data to show you’re addressing real user concerns.

Sections included: 

• Executive summary
• Cost analysis
• Implementation timeline
• Our team
• Conclusion 

Product strategy proposal 

While this product strategy proposal template is designed for a digital marketing agency offering its services, it’s versatile enough to be adapted for pitching a product strategy to your own team.

In the solution and proposal section, you can lay out a new product strategy and highlight the specific tasks needed to implement it successfully. For example, if you’re proposing a shift to a mobile-first approach, you can detail the steps like redesigning the user interface for mobile, optimizing performance for various devices, and implementing responsive design principles.

Sections included: 

• Cover letter
• Executive summary
• What you need
• Opportunity
• Solution
• Proposal 
• Metrics
• Services
• About us
• Our clients 
• Pricing
• Terms
• Getting started 

Different kinds of product proposals, and how to write them 

Sometimes you’re launching a new product, other times you’re pitching changes for an existing one to make it more competitive in its category.

Let’s talk about key areas you should focus on, depending on what kind of product proposal you’re sending:

Launching a new product

A new product can create fresh revenue streams, helping the company diversify and rely less on existing products. It also directly tackles customer frustrations with current offerings, boosting satisfaction and loyalty by solving these pain points.

Key areas to include in your proposal: 

• Reasons for the product launch: clear opportunity in the market, lower satisfaction rate with existing customers, opportunity to tap into a new market 
• How your product is going to be different from existing products 
• Monetization and revenue plans 

Improving a new product

By adding new features or refining existing ones, your product can stay competitive against new market entrants. Keeping up with trends and technologies ensures it meets evolving market needs. Plus, improving efficiency, quality, and user experience often justifies higher prices, boosting profit margins.

Key areas to include in your proposal: 

• Feedback from legacy users and previous customers, including sales trends 
• Cost-to-benefit ratio for differentiation or making product improvements 
• How the changes are going to directly address customer feedback
• The impact of these changes on customer experience, loyalty, and revenue 

Entering a new market with an existing product 

Expanding into a new market with an existing product is a strategic move that can significantly boost a company’s growth and market share. This approach leverages the strengths of a proven product while exploring new revenue streams and customer bases. 

Key areas to include in your proposal: 

• Data on the new market’s potential and demand for your product.
• Specific demographic segments within the new market that are most likely to adopt your product.
• A detailed breakdown of the investment needed to enter the new market.
• The expected revenues and profitability from the new market