The Unsuspected Danger of Building Good Products

What makes a good product?

Best-in-market technology? Stellar user reviews? Right time of entry? Each of these factors indicates potential, but in truth, a product could have all three of these items going for it and still tank-it in the market. Just ask any of the 75% of venture-backed companies who fail to return their cash to investors.

So what’s happening?

Turns out, a lot of times, people are just focusing too much on quality.

The Difference Between Quality and Product-Fit

Sounds strange, right? Focusing too much on quality. But it’s true. In the early stages of building a product, more attention should actually be allocated towards the overall fit of your product within the lives of your users.

There’s an important difference between the quality of a product and product-fit. “Quality” is how well a product solves a customer issue. “Product-Fit” is a product’s ability to make the customer solve the issue, using your product. And beyond picking your product just once, Larry Page looks for it to pass the “toothbrush test” and be used twice a day.

The quality of a product is important. And quality does factor in to the overall fit of a product. But quality is not everything. Factors like price also play a significant role in the overall fit of a product vs. the other options in the market.

The original Echo was nothing to look at and lacked “skills” but sure found Product-Fit

Take the Plaxo story for example.

As a division of Comcast, the team at Plaxo was developing a product to solve the issue of Contact List disorganization. At the time I was the GM at Plaxo and working hard with the team on this shiny new product: The Plaxo Personal Assistant. It had premium, automated features. Integrated, cutting-edge database technology (Cassandra). Machine Learning. It was a beautifully-crafted product in a wide-open market. To boot, seemingly every working business professional griped and groaned about the issue of Contact List disorganization, and there we were: proudly holding the answers.

And then we went to market…

Our quality was through the roof. Demand was high, and competition was low. What better conditions could you ask for?

Product Page for Plaxo Personal Assistant (2011)

Well, there we stood. And what we got…

……………………..

………..

… was crickets.

As a product person, this hurt. Everything I had built up to this point in my career had worked. How could I expect people to trust my judgement after a huge failure like that?

Around the same time as this letdown, Eric Ries was gaining traction with his Lean Startup movement. I went to the meetups and heard Eric talking about the hundreds of other failing startups out there. He argued that ideas should be built simpler and proven faster to avoid overinvesting in them. Everything he was describing was exactly my pain at the time.

We invested two years’ worth of time and money developing a high quality product that no one would pay for. Dwelling on quality and neglecting product-fit With Lean methodologies failure still happens, but it happens faster, and allows you to move on sooner to the next idea. Failure becomes a valuable part of the process and not some ominous threat.With concepts like Minimum Viable Product we could’ve spent under six months teasing out these unknowns earlier on in the process. The fact that our price-point was too high and our entire initial business plan needed major adjustments would’ve been quickly evident.

I came away from this experience with a conviction that that overinvesting in a product’s quality, and waiting too long to shift that focus over to its overall fit within the market, is a serious pitfall. Equipped with these new methodologies, we then tried out some other ways of pivoting the business, and they, too, seemed not to fit in their markets. But we had found a way to get to this point in the process in a fraction of the time it had taken us before.

Team whiteboard at Plaxo as we explored possible pivots (2011)

At this point we had verified that there was no way to grow the business and recommended Plaxo be shut down. I expected I would part with the company but the management team at Comcast noticed the value in what we had gone through and asked me to apply what we were learning to their TV business. And so my work at Comcast Silicon Valley began.

We’re still applying the Lean methodologies today for our new product offerings and seeing success with it. Even if that success means failing quickly and getting to those products that do fit in the market and ultimately succeed in influencing the lives of our customers. Ash Maurya’s Lean Canvas is still a great way to flesh out a variety of business models–I’m even using it on a project today.  And never again will I over-build large and expensive products without testing for product-fit early on.

Lean Canvas by Ash Maurya

Preston Smalley produced in collaboration with Mark Mizera.

Speaking @ SVPMA on Sept 3

I’m speaking at the Silicon Valley Product Management Association next month on the topic “Getting Products out from under the MIDDLE of the Bell Curve and Exceeding Expectations”.

In my talk I’ll discuss how Product Managers play a profound role in creating the environment around product development teams. I’ll explore various ways they can influence these products to move up from mediocrity and how to avoid micromanagement and “flavor of the month” feature ideas.

I’ll discuss specific ways to set clear goals and establish the right metrics. Dipping into my eBay days, I’ll share a little known story of the importance of asking for forgiveness rather than permission in driving innovation.

Some other takeaways from this talk will include:

  • How to focus on the right, few, customer adoption metrics (e.g. AAARR). More is often not better and can distract from the main goal
  • How defining your product’s purpose often improves working relationships with designers and engineers so you aren’t left arguing about the “what” or the “how
  • How to avoid getting in the executive micromanagement web especially if they are distracted by the “flavor of the month” or “pet feature” ideas
  • How to drive stealth projects or go through quick business case or product prototyping within a big company

In addition to speaking, we’ll be hosting the event at our Comcast Silicon Valley Innovation Center in Sunnyvale.

Join me and RSVP for the Event

Event: Sept 3rd from 6:30 – 9:30