How to Know When Your Product Is Going to Fail
Published: June 4, 2012
A primary purpose of UX research is risk mitigation. When we perform research we often look for indicators that let us know whether we are on the right or the wrong track with product development—and, if we’re on the wrong track, how we can get back on the right track. Continuing on the wrong track can be extraordinarily costly, both in your financial investment in research, design, and marketing, as well as the potential cost of losing customers. Because of this, we advocate for companies to make research a priority, because it can be the leading indicator of product success.
Take, for example, the case of Netflix. Late last year, Netflix management announced that they would split DVD lending and video streaming into two separate services—coupled with a 60% price increase. The company quickly realized that they had made a mistake when customers cancelled their subscriptions in droves and Netflix stock lost 60% of its value. Netflix CEO, Reed Hastings, admitted that they had moved too quickly in announcing the service split and had fumbled the announcement badly because they had misunderstood their customers. Ironically, Hastings talked about performing research, but they had conducted only focus groups to help identify names for their spin-off service. If they had done more concept testing to ascertain customers’ readiness for the splitting of these services, they might have discovered that both content availability and the quality of streaming video are not yet sufficient to fully supplant DVD lending—or at the very least, that there would be massive customer backlash on the split they were planning.
Therefore, this month, we’re going to examine ways in which your UX research efforts could help your organization recognize whether you’re going down the wrong path.
You Don’t Know Who Your Users Are
If you’ve been developing a product or technology and are getting ready to put something in front of users, but you don’t know who your users are, you might be on the wrong track. We’ve seen this happen quite a bit with startups that have an engineering focus. A company may be pursuing an idea for a technology without thinking about a specific application or user need for it. We often refer to this as a solution in search of a problem.
This doesn’t mean you can’t find a problem that your technology can solve, but doing so is often quite costly. In addition to your doing the research that is necessary to properly segment the market, identify users, then understand those users, it is likely that you will have to make modifications to your technology for it to be viable in the marketplace. Such modifications could require significant backtracking or so much additional spending that making them would be cost prohibitive.
Your investment in product development is safer if you first conduct market research to ensure that you’re developing a technology that can return your investment. It’s true that there are companies that have been able to develop successful products without knowing their users or doing market research, but these companies seem to be exceptions to the rule. We highly recommend having a user clearly in mind before you commit financial resources to a development project.
You Can’t Find Your Users
If you have spent three weeks trying to recruit users and you can’t seem to find them, you might be on the wrong track. Even if you have particular users in mind, your inability to find them may indicate that they exist in very small numbers or may be difficult for sales, marketing, and advertising to reach. We’ve had clients who were attempting to target a specific user group that had a definite need, but a market that was just too small to address through a consumer product. For example, an application targeting fighter pilots and providing improved training might meet a strong need, but not have a large enough user base. Despite this significant need, a small and declining market of just 3,600 users meant that it would be extremely difficult to create a profitable consumer product for these users. Additionally, it meant that the population would be extremely difficult to recruit for user research.
Aside from there being a small market comprising few users, there are other reasons why a user population that is difficult to recruit might mean you are on the wrong track. Low-tech seniors, for example, are in need of services, but are difficult to reach through the most common recruiting channels such as social media, craigslist, email, or other digital communications. When recruiting low-tech seniors, you must often rely on friends and family and word of mouth. This difficulty in recruiting participants portends a similar problem when it comes to marketing and advertising the finished product to that market segment. While modern advertising has moved primarily to the Web, a company would need to rely on traditional media to reach this type of user. Purchasing advertising such as television airtime would be very costly for a startup or a company exploring a new vertical. These are all factors to keep in mind when identifying a market.
Your Users Don’t Agree on Anything
If you are working with a market segment and users are completely divided about what they want in a product, you might be on the wrong track. You might find that some users love a certain feature set or design direction, while other users hate that same feature set or design direction. In this situation, it becomes very difficult to determine the appropriate feature set or an effective design direction for your product. There’s a very good chance that you’ll alienate half of your intended users, but there’s a much more significant danger of losing all users by trying to please everyone.
If this happens, chances are that you are dealing with two or more unique groups within a market segment. Take the camera market, for example. One market segment comprises professional photographers, but within that segment, you might find significant differences in peoples’ needs and preferences. When investigating further, you might find that landscape photographers have very different needs from portrait photographers. In this case, you should further segment the market. Once you’ve done so, you’ll have a choice to make: either to try to design for both segments or to pick a single segment on which to focus. If you focus on one segment, obviously you are giving up the entire other segment and targeting a smaller market than you had previously intended. You’ll have to go back to your market research to determine whether this smaller segment is worth your investment. However, if you try to target both segments, there’s a danger of creating a product that doesn’t work well for anyone by attempting to incorporate wide-ranging features and design elements that begin to interfere with each other.
Your Users Don’t See Value in Your Product
If you put a product in front of users and they don’t tell you that they want it, you might be on the wrong track. Steve Jobs famously said, “People don’t know what they want until they see it.” This is typically true. People are often so accustomed to their own unmet needs and pain points that they can’t see them anymore. It’s for this reason that self-reporting through surveys and static interviews are unreliable sources of data.
If you really want to know whether users would see value in your product, you have to show it to them. Concept tests are a very effective means of doing this. A concept test involves showing users concept drawings, mockups, and/or prototypes of your product to determine whether they understand the value proposition and agree that the product has value. We recommend your doing concept testing early, incorporating the testing of concept drawings into contextual interviews and ethnography sessions. As a project proceeds, you can progress to testing early mockups, then functional prototypes.
You’ll get an early warning if users don’t understand the concept drawings for your product; or worse yet, if they understand the concept perfectly, but just don’t want such a product. If this occurs, it’s important to determine what you could do to clarify your product’s value proposition by asking participants what would increase or establish its value. Subsequent tests should determine whether any adjustments you’ve made have helped to instill value in your product and clarify its value proposition.
There is also the possibility that users just can’t grasp the utility of your product by seeing a concept drawing, but would by experiencing an actual finished product. While this might be true, the longer you go without users’ seeing value in your product, the greater the risk that you might be investing a great deal of money and resources in a product that is doomed to fail in the marketplace. Managing risk is ultimately a judgment call, but one of the primary purposes of UX research is to mitigate risk and keep companies from losing money. One successful application of research is identifying what projects to cut before making significant investment in them. That said, with the right information at the right stages of product development, most projects can pivot to become something that would be useful to people and, thus, be successful in the marketplace.
The Right Track
None of this means that, if you run across one or more of these phenomena, you are definitely on the wrong track. These are simply indicators that you might be in for some trouble. The more of these difficulties you encounter, the more likely the chances that you are sniffing up the wrong tree and need to make some serious adjustments to your product or even cancel a project entirely. Pivots can result in enormously successful products, because you’ve built them upon knowledge you’ve gained from an impending failure.
On the other hand, if you have a clear understanding of your users and are able to reach large numbers of them easily, and they agree on what they want from a product and can’t wait to get their hands on the finished product, you are almost certainly on the right track. Seek to achieve such a result through a close collaboration between research and design, and doing research will serve you well.