While I was reading the other evening, I came across a tremendous metaphor. Conner Forrest, a writer for TechRepublic, equated admitting your own business’s failures to calling your own child ugly. No one wants to admit that their ideas aren't all that revolutionary or innovative. Acknowledging flaws in our products — ones we have built, invested in, and grown — can be a painstaking process.
However, our success is often defined by how well we handle failure. Not one successful person has achieved their goal without encountering several setbacks and learning experiences along the way. It's certainly difficult to feel like we're on the road to success in the face of a languishing product, but we can refocus our efforts to learn why our product is failing and how we might push it through to market success.
Let's take a look at a few ways to accomplish this:
1. Adjust Your Messaging According to Feedback
You may love your idea, but you’re not the one buying the product. It’s tough for all of us to admit, but a product that's just not selling is a huge red flag. Customers are the largest stakeholder in our products' success. If they’re not falling in love with your product, it's not going to sell anytime soon. Matt Mickiewicz, founder and CEO of hired.com, explains in a TechRepublic interview:
“If your users and customers aren't in love with your product, and can live without it, and you don't have a clear and definitive product plan to fix it, it might be time to call it quits.”
The Fix: Get back to the basics. Just because the product is failing doesn’t mean your entire business is a failure. Invest in additional market research. Study your competitors and find out what they’re doing that resonates with customers. Discover what your customers are saying and what their biggest objections are to your product.
A prime example of this: Domino's Pizza. After years of waning sales and customer apathy, Domino's took a risk: they admitted their pizza wasn’t good and embraced a rebranding. In an article in Harvard Business Review, Charleen Li, Founder at the Altimeter Group, explains,
“Viewers of these [new Dominoes] ads described them as ‘bold’ and ‘refreshing,’ and gave the company credit for acknowledging what everyone already knew. The result: store sales rose and quarterly profits doubled. Domino’s took a failure point — its horrible pizzas — and made it a rallying point.”
Your customers, too, may reveal an important messaging shift that your brand could utilize to jump-start a failing product.
2. Find Pricing Flexibility
If your product received a large amount of positive feedback during the research stages, but it still isn't moving off the shelves, your issue may be the pricing. No matter how revolutionary our product or service may be, in the end, it must be priced at a level that customers won't balk at. If your pricing doesn't create a good value proposition for customers, they won't pay.
The Fix: Be flexible. Stubborn pricing can kill businesses. Is it better to sell 10,000 units at a reduced price or 400 at the price we think it is worth? The Segway is one such example of a product that found a new niche through an alternate pricing model. When its inventors launched the innovative device, they marketed it as the future of travel. They quickly found out otherwise. Julie Hall, launch analyst and author, explains in an article in Harvard Business Review,
“Instead of selling 10,000 machines a week, as Kamen [Segway's Founder] had predicted, the Segway sold about 24,000 in its first five years. Now it sells for far less to police forces, urban tour guides, and warehouse companies, not the general public.”
Finding ways to make your distribution or production more efficient can help you effectively lower your product's price without having to adjust the profit margin. Otherwise, a price adjustment may mean a lower profit per unit, but a higher volume of sales.
3. Utilize Your Loyal Customers
Often, the most powerful approach we can take to a languishing product is to simply narrow the your focus. Ask yourself: Is the market the same as when you launched? Often, unforeseen market shifts can derail our product launch or lead to stagnant sales numbers. This may be the time to zero in on your current loyal customer base.
The Fix: A market shift doesn't mean our product needs to fold. If we have loyal customers, it may be time to narrow our funnel and focus on those most loyal to us. It may be impossible for our brand and product to find success if we are spending large portions of both our time and capital on marketing to several large segments of customers. Narrowing your focus to the loyal customer segment that you've built up can keep your business lean and allow you time to continue to develop your product.
A Failing Product is a Valuable Lesson Learned
If the above steps fail, it may indeed be time to pull the plug on your product. It's a difficult step, but numerous entrepreneurs have experienced failed products and launches and still gone on to achieve success, and it's largely because they were able to take away lessons from their past ventures without becoming discouraged. Even if your current product does not achieve the success you had hoped for, there may yet be prosperous days on your horizon.
Do you have your own tips for evaluating and salvaging failing products? We'd love to hear them! Tweet us @EidsonPartners!