The brands that are most marketable over time are the ones that listen to their audience and meet their needs with creative, valuable solutions. The history of the modern business world is full of companies who have done this masterfully (adapting with the ebbs and flows of the market) and those who have failed to adapt when needed.
Whether your business has been around for years or only a few months, it's never a good idea to get too comfortable with "the way things have always been" when it comes to your product. The tides change rapidly in the business world, and the best way to stay on top of that movement is to have an ear to the ground to discern what your customers want and how to best deliver it to them.
In this article, we'll be breaking down some of the best practices to consider when it comes to optimizing your product over time. We'll be providing some examples of companies who have adapted their offers well and highlight others who have failed and now serve as a strong warning to businesses looking to thrive over the long-term.
Why does product optimization matter?
Product optimization is the process of continually refining your offer to meet the ever-evolving demands of the market you serve. In the midst of everyday operations, this concept can easily appear unimportant. After all, you probably have a dozen immediate responsibilities that trump a long-term, big-picture concept like this. Not to mention the fact that making changes to your product can be a daunting task.
But the danger of getting too comfortable with your product (and the operations involved in creating, maintaining, and delivering that product), is that when changes come to your industry or the needs of your customer, you might already be behind your innovative competitors.
By taking time to proactively change, add to, or improve aspects of your product over time, you'll never have to deal with the panic of finding yourself and your company behind the eight ball, trying to keep up with your competition. The following steps outline a few important principles to consider when it comes to optimizing your product.
Listen before anything else
Prioritizing the optimization of your product begins with listening to key voices who have insights into your specific industry. This includes hearing suggestions from your team members, speaking directly to your customers, and even observing the changes that your competitors are making.
The individuals involved in developing your product, purchasing your product, or developing alternative products within your industry, are the ones who have the most direct insights into the offers that are working the best.
Maybe it's as simple as the way you deliver your product or the features that are included in your product or the price that you set for your offer. Whatever it may be, don't neglect the importance of listening and adapting to the needs of the people you serve.
Innovation is the key to all of this, and the first step to successful innovation is listening carefully to the voices around you. All product innovation stems from a holistic understanding of your customers' problems - as those problems evolve you should be quick to adapt your offer to best meet those changing needs.
Kodak's road to bankruptcy
One great example of this evolution can be seen in the digital camera industry. Toward the end of the 20th century, brands like Canon and Nikon read the writing on the wall and began prioritizing the development of digital cameras within their own product lines, even though this development greatly deviated from the film cameras they were typically known for. Kodak, on the other hand, failed to adapt to the changes sweeping through their industry and the subsequent desires of their customers that accompanied those changes. Despite the fact that the company developed one of the earliest models of the digital camera, they failed to listen to the demand of their customer base and ended up filing for bankruptcy in 2012.
Track technological advances within your industry
At one point in time, the railroad was the pinnacle of advancement in transportation, bringing passengers to further destinations, faster than they could have ever dreamed. That is, until the first automobile was developed. At that time, the monopoly that railroads had over the transportation industry was strong and few of the leaders within that industry could have anticipated the interruption that the car would cause. However, our modern day hindsight makes it obvious that such a change was bound to occur.
In much the same way, technological advancements are happening around us all the time. Individual companies and entire industries are making small shifts that lead to big changes that lead to entire interruptions of the systems we use on a daily basis.
In the world of business, technological advancements encompass everything from product development to marketing methods and sales platforms. The companies that are quickest to adopt technologies that improve their products and the lives of their customers are the ones who establish the strongest roots in the modern age of innovation. Companies that get complacent with their operations and fail to stay abreast of these advancements will undoubtedly find themselves slipping behind the competition in one way or another.
Just as the railroad gave way to the automobile, technological advancement today doesn't guarantee that something won't overtake that advancement in the future. That's why it's important to prioritize innovation across your entire organization, making it clear to every team and department that no process is completely set in stone.
At the same time, it's important to understand what technologies are simply fads and what are industry-shaping advances.
As seen in the previous example with Kodak, a lack of technological innovation played a large role in their decline and eventual bankruptcy. But when you think about the greatest companies that exist today, their continued success, whether they were founded two hundred years ago or a decade ago, can be attributed to the successful embracing of technology. Let's look at a few examples of this.
Apple and Netflix embrace disruption
Apple has not only ridden the wave of innovation but has initiated the wave sweeping through their industry to set the standard and create a product that's difficult to replicate or replace. This is a company that has built their entire business model around continual product optimization and disruption, releasing new versions of each of their products every year. Not only have they created a brand that is known for innovation, they have built a customer base that craves this disruption and keeps coming back for more.
Similarly, the move from DVD rentals to streaming services could have decimated the existing business model that Netflix had created. Instead, the company pivoted their offering and effectively led the way for streaming platforms everywhere.
Know when to expand and when to niche down
Growing your brand involves correctly understanding the ways you should expand your offer. Oftentimes, that expansion means offering more products and services, but sometimes it can mean niching down to just offer the services most valuable to your customer base.
Once again, the standard of measurement should be your customers' needs. If meeting those needs involves creating more products, then that might be the best option. But if their needs can be met with fewer products, you might want to scale back and focus on what you do best. Let's look at both of these principles in action.
Shopify and Amazon push the limits
In 2006, the founders of Shopify started a company called Snowdevil, a platform designed for snowboarders to buy equipment online. However, after realizing the e-commerce platforms available to them were insufficient, they expanded the company to reach even more people. Today, their platform helps small businesses (like Snowdevil) create online stores that make the entire process seamless and easy.
Amazon followed a similar path when it expanded from an online bookstore to the most extensive online marketplace in the world. Jeff Bezos saw an opportunity to scale his platform and knew the market was there for his brand to incorporate more products into the website. Today, Amazon is one of the biggest organizations in the entire world, all because Bezos decided to embrace expansion.
Marketable Connections narrows down to scale up
Sometimes the opposite is required, and scale will come by narrowing your focus on a certain area. Many organizations make the mistake of trying to offer too much to too many people. The old adage, "when you try to be everything to everyone, you become nothing to no one," applies to many companies who get caught up in the allure of examples like Shopify and Amazon. For many organizations, the best strategy is to narrow down what you do best and scale from there.
Our partner site, Marketable Connections, is a prime example of this. What started as a site geared toward hiring all types of employees, was redesigned to only provide marketing contractors to businesses in need of professional assistance with projects. By narrowing the focus, the brand was able to pour more energy into a more refined product, better meeting the needs of a specific type of customer.
Segment your customer base
Your customer base is made up of a wide variety of individuals who will likely possess different needs when it comes to the product or service they are looking to buy. Therefore, optimizing a product might look different from one customer to the next. As we mentioned before, it is true that you can't be everything to everyone, but you can optimize variations of your products for these different needs. This is where segmentation comes into play.
Segmentation could mean offering three different pricing options for your services or even a product package that customers can customize for themselves.
This, along with many of the principles already discussed, comes down to fully understanding your customer base and uniquely meeting their diverse needs.
ClockOn's product customization process
ClockOn is another great example of an organization that evolved over time. Started by a cardiologist for use in his practice, ClockOn evolved into a full-featured payroll, rostering, and time & attendance SaaS platform. Throughout their journey, segmentation played a vital role in targeting different needs within their customer base. By offering a variety of pricing options for their platform, their users are able to customize their experience, only paying for what is needed, with the option of adding services when they are ready to scale. ClockOn's Marketing Manager, Blake Smith, described the process in this way:
"By understanding the unique needs of each segment and providing them with the most relevant and customized solutions, we ensure our customers can use our software successfully and experience the full benefits of our platform. This approach has contributed to our high retention rate, as we prioritize customer satisfaction and strive to deliver a positive user experience across our different product variations."
Anticipate the future needs of your customers
Tracking trends in the current landscape of your business might not be all that difficult, but what is hard is predicting the future needs of your customer base. Beyond simply staying on top of industry trends, this involves a keen awareness of your customer, in some ways requiring that you know them better than they know themselves.
By proactively anticipating their needs and solving their problems, you will set the standard in your industry, in much the same way that brands like Apple have done for years. But failing to accurately follow those trends could result in major setbacks for your brand.
The fall of Blockbuster
As was discussed with the Netflix example, consumers over the past decade have moved into a new era of consuming entertainment. While Blockbuster, the classic movie rental store, had a firm footing within the DVD rental space in the early 2000s, they failed to understand and adapt to the changing desires of their customer base who was moving into a new era of streaming movies from home. This failure to anticipate the future needs of their customers directly correlated with the company's decline and mass store closures over the past decade.
Tru Earth's commitment to customer needs
Tru Earth, a small business specializing in the creation of eco-friendly household products, has taken a more proactive approach to their product development. They have created a loyal customer base around their mission of eliminating plastic waste while simultaneously creating quality products. Their commitment to their customers and continual optimization of their products has led to 944% growth for their brand in the past 3 years alone. Ryan Mckenzie, Co-founder and CMO of Tru Earth, explains the company's success accordingly:
"Product evolution is driven largely by customer demand coupled with advancements in technology. It's about having your finger on the pulse of what your customers need now but also anticipating what they might want in the future."
While it's never possible to know what the future will bring, this commitment to studying your customer base and evolving alongside them will lead your brand to new heights even as your competitors struggle to keep up with the changes.
Embrace the inevitability of change
If you've done all these other steps well, you should have a good understanding of what your customers want and maybe even how you can give it to them. The one thing you must do now is embrace the inevitable changes that will come with time.
If you maintain a commitment to both your customer base and product innovation, you are far more likely to succeed. But if you hold on to the way things have always been done, the tides will eventually change, leaving you far from where you thought you would be.
Oftentimes, the reluctance of a few leaders within an organization to change can lead to the demise of an entire company.
Blackberry fails to innovate
Like we mentioned earlier, Apple was continually innovating, creating a brand that set it apart from all others in the marketplace. Blackberry, on the other hand, focused on what they had always done and refused to consider anything different, even when their customer base started to move to the competition in droves. They stuck to a rigid user system and refused to make changes to their products. Today, Blackberry's products are primarily a thing of the past, while Apple has established itself as an integral part of both the home and work lives of many, many consumers.
What is the best way to get started?
While the thought of continually evolving your product might seem overwhelming, it should come to you as a relief in many ways. Instead of having to create the "perfect product" before launching, you can launch to your customer base and make necessary changes over time that appeal most to that group of people.
You shouldn't be looking to make drastic changes to your product often, but you should be prepared to do so when the time comes... and if you are in business long enough, the time will come.
Your goal when getting started should be continuous improvement over perfection.
Most people see their product as something that is completed once and never tweaked or refined again. That mentality might work in the short term but will guarantee failure if you want your business to stick around for the long term. Don't let failure, or the fear of failure, deter you from moving forward.
Additionally, research should be a continual process within your organization. Everything from conversations with customers to your marketing methods should be viewed as research opportunities, providing insight into the messages and qualities of your brand that resonate best with your target audience.
If you are in the process of creating a product for the first time, an MVP (or minimum viable product) is a great place to start. And if you already have a product, don't be afraid to reinvent it when the time is right.
The completion of your product should be seen as a marathon, not a sprint. Yes, it's important to develop it to a certain point and to achieve goals, but don't see that goal as the end, just another milestone on your journey to creating the optimal product.
Conclusion
We are living in an era of rapid change and innovation. Prioritizing innovation within your own company is the best way to ensure your small business not only survives the unpredictability of the years ahead but expands with time.
By adopting a mentality of optimization rather than completion, your product will simply get better with each new year, staying on top of the most recent trends and maybe even setting a few along the way.