A host of disruptive technologies, starting with cloud computing, are raising customers’ expectations of the products they buy and the quality of the encounters they have with their vendors. These new technologies have significantly lowered the costs of bringing digital products to market. With limited resources needed to get in the game, the market only gets more crowded. As competition increases and digital technology revolutionizes the marketplace, innovation, and product development have shifted from “nice to have” to a business must for enterprises to survive.
When it comes to digital products, the product is the experience that raises the stakes of providing users with a first-class experience right out of the gate. Brand equity, however, won’t help a lousy product rollout. Apple, a brand powerhouse, launched Apple Maps to a great thud. It was so bad Apple’s CEO issued a public apology, and the company invested in rebuilding the entire application. Even though a decade later, Apple Maps is a much-improved product compared to its earlier launched version, it’s still trying to move past its initial public perception.
Few companies have the brand equity and deep pockets to weather such a failure and rebuild entirely. Most companies developing digital products get one chance to impress customers and lay the foundation for future growth. Yes, customers also expect continuous innovation, with new features constantly added. That truth shouldn’t obscure the fact that companies need to get the first version of their product right. That first impression drives public perception. That perception directly affects whether the product gains enough traction to generate valuable customer feedback to assist the company in building a product development roadmap that will attract new customers and retain early adopters.
A minimum viable product isn’t good enough
The traditional wisdom governing new product development is to launch with a minimum viable product, the MVP. The MVP model focuses on what the company needs from a product launch.
A better goal is to launch with a minimum lovable product (MLP). The MLP considers the customer when deciding what features and design will inspire excitement for the initial product. For a new product to get the traction needed, it must include the features that feel most important to the customer. This is what pushes an MVP upwards to MLP status.
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Every successful product starts with addressing a customer’s pain point
Researching where customers feel pain is the first step to understanding the problem space and designing a quality product. It’s vital to comprehend what problems the product will resolve and how that pain is experienced by the customer. This process is called “working backward from the customer.”
Established companies have more direct research sources to learn about customer pains, needs, and wants than do new companies. As such, they should mine all their sources for customer feedback, including gathering input from their support desk, product reviews, and social media talk.
Start-up companies with no customer base can research public forums and product reviews of other products in the same space. They can conduct market research, focus groups, and competitor research to get feedback on how others are trying to resolve the pain and how customers respond to proposed solutions.
It’s important for all companies to engage in data analysis to uncover gaps or pain points not articulated by customers. Established companies can look at internal performance and usage data, including whether pages load slower than industry standards and if there are common ways customers misuse a field or function. New companies can look at industry benchmarks.
Set the product vision and its North Star
Every product development needs a clarifying vision for the product and a North Star that guides its execution at every point along the road map. A vision is a forward-looking statement that outlines what you want to achieve and inspires the team (or the company). It answers the question of what pain point this product resolves over the long term. For example, here is the Tesla’s vision: “To accelerate the world’s transition to sustainable energy.” The vision decouples and abstracts its current strategy of building electric cars to focus on the long-term direction and aspirations.
At Amazon, they conduct a vision exercise at the start of a new product development program. A group of stakeholders, including developers, write an internal press release before product development begins. In this press release, they clarify the problem and how this product solves it. The document answers critical user questions and includes examples of the positive customer feedback they want to receive.
While the vision statement defines the product development strategy, the North Star governs its tactical execution. The North Star is the metric, or small group of metrics, the business uses to judge whether the development solutions executed stay aligned with the product vision. A good North Star Metric represents what customers value about your product and is a leading indicator of success. For example, for a company upselling features in a free phone app, “percentage of repeat purchases” is a good North Star metric on how much customers love the product, rather than a metric like “total number of purchases.”
When any change is made to the application, this North Star metric must be tested. If the change doesn’t move the metric in the positive direction, then a new solution is required. The feature or change should still be based on the product roadmap, but it just needs a new execution plan.
Get the company culture right first
Achieving a successful launch and building a roadmap that leads to product growth isn’t possible without a collaborative company culture. Everyone working on the product needs to demonstrate buy-in and understand the product vision, not just those who were on the team that developed the vision statement.
Senior managers must foster a fearless environment where employees aren’t scared to voice their opinions or point out errors. This culture of supportive collaboration stimulates a bottom-up innovation channel, where employees feel confident about pitching ideas that could enhance the product line.
Building the right product roadmap from the start
There will always be time pressures and resource constraints, forcing prioritization in the product development process. To ensure the company is planning to launch an MLP and to keep customer adoption high, the product roadmap must have four buckets holding product features:
- Features critical to launch (P0): This bucket includes the features necessary to take an MVP to an MLP.
- High value, non-critical features (P1): Additional features should be included in the launch version, if time and resources allow, but aren’t necessary to launch an MLP. If they aren’t part of the launch, they’re the immediate next development phase, pending customer feedback.
- Features waiting on prioritization: These features sound like good ideas in the team room, but their value isn’t confirmed. As the company collects customer feedback and changes in the market occur, some of these features will get verified, and others will get rejected.
- Idea Box: This is the space for unformed ideas based on potentially radical changes due to disruptive tech or competitor models, where stakeholders can speculate on new needs, pains, or opportunities that can’t be clearly articulated yet. It’s a reminder to stay alert and to stay agile.
Stay alert for pivot moments
Product development is a continuous process and opportunity to recategorize and re-assess innovation ideas in the road map based on customer, market, and technology changes. Disruptive technologies can change business models and customer expectations overnight. Companies that don’t keep an eye on how their market, new technologies, and new players develop can get overtaken by new products with a strong initial rollout. MySpace was the social network until Facebook launched to a narrowly tailored market (Harvard University students), promoting high adoption rates in a controlled space. Building on its success at Harvard, Facebook gradually expanded to other colleges, high schools, corporate users, and later the general public.1
When deciding whether to transform an analog or older tech product to a new platform, companies should quantify the expected increase in value to the customer. If a platform upgrade only achieves an incremental value boost, it’s probably not worth the investment. If the company sees a path where radical change results in a ten-times the value boost to existing customers, then the investment may be worth it.
An unpredictable future demands deliberate groundwork
Digital product development is exciting because the digital world is full of unknowns. New technologies facilitate and enable disruptive business models. Some new technologies are themselves disruptive, and some industries or companies are unsure as to how they fit into their road maps or if these technologies call for entirely new products and direction. Nearly nine out of ten companies listed in the 1955 Fortune 500 were off the list by 2019.2 Those companies that can’t adapt the new product development and launches to new technologies will likewise make themselves obsolete.
Despite this unpredictability, there are two constants all companies need to embrace:
If they don’t get the first rollout right, they may never get that product back on track to become profitable. Even with future updates and great improvements, companies can spend decades chasing the market leader. If they had started off right, they might be the market leader.
The right company culture is a necessary foundation for a favorable new product launch. A culture of wide, fearless collaboration that empowers and motivates employees is more likely to generate the hard work needed to execute an MLP that positions the new product line for ongoing success.
As the saying goes, “You never get a second chance to make a first impression.” Digital products have seconds to make a powerful first impression on users. In today’s competitive marketplace, the need to make a positive first impression has never been more important. Negative first impressions require massive efforts to change users’ opinions. On the other hand, strong first impressions enhance user experience and build brand loyalty. By approaching digital product development and launches with a customer-centric, collaborative, and strategic approach, companies can survive and thrive amidst the chaos of the app marketplace.
References
1. Why Facebook Triumphed Over All Other Social Networks https://www.forbes.com/sites/gilpress/2018/04/08/why-facebook-triumphed-over-all-other-social-networks/?sh=71d324206e91
2. Only 52 US Companies Have Been on the Fortune 500 Since 1955, Thanks to the Creative Destruction That Fuels Economic Prosperity https://www.aei.org/carpe-diem/only-52-us-companies-have-been-on-the-fortune-500-since-1955-thanks-to-the-creative-destruction-that-fuels-economic-prosperity/
About the Author
Pradeep Chinnam is a technology leader with 13 years of experience in building software and managing high-performing teams to deliver scalable services at industry-leading technology companies. Over the years, he owned and operated tier-1 services in the e-commerce and travel domains. For further information, please contact pradeep.chinnam@gmail.com.
