How to build successful products in a digital world

Posted 1 year ago by Nikkel Blaase

Great digital products don’t suddenly appear out of nowhere. In fact, they are sophisticated artifacts that have successfully grown into great products after a careful product discovery process. They are delightful experiences, easy to use, and beautiful to look at, providing outstanding value to its users.

“Building a great product is an art as much as a science.” — Paul Adams

The vast majority of products fail during the discovery process or shortly after launch. Either they fail at providing a meaningful user value, people do not use them frequently or the number of users does not grow properly. Few products will serve the market: Meaningful products that have mainstream attention, innovative solutions no one imagined before, causing a change in people’s behavior. These are the products we commonly know, admire, and remember. These are the products we want to build.

Product development cycles

The idealised 3 strategic product development cycles.

What it means to build great products

To build successful digital products we need to focus on the things that matter most: On a real problem people have and that is considered worth solving — the problem-solution fit —, on a market demanding the offered solution — the product-market fit — and on scaling the product into mass market — the distribution-conversion fit. We want to build economically viable and technically feasible product innovations that people care about.

Understanding the opportunity

Brand new products usually originate from business opportunities. In order to identify and thoroughly understand the opportunity, the basic conditions need to be clarified first: “Why are we doing this?” — “What is the current situation?”, — “What do we intend to change?” — “Which impact do we expect?”, — “Which constraints do we have to consider?”.

When, for instance, bicycle sales in the US dropped significantly, IDEO cooperated with Shimano, a Japanese manufacturer of bicycle components. To identify the opportunity they started to learn why 90% of American adults did not ride bikes anymore, even if they enjoyed it as kids. After interviewing American adults the project team discovered that the excessive costs of purchasing and maintaining a sophisticated machine ridden only on weekends and the danger of cycling on roads not designed for bicycles deterred the consumers (“Change by Design”, by Tim Brown). In the end, the real opportunity here was to tackle these discovered pains by design, and not by building even better bicycle components.

Finding Problem-Solution Fit

Problem-Solution Exploration

Steps, complexity, and timeline of the problem-solution exploration.

Once we deeply understand the business opportunity we need to explore the problem-solution space to find out what to build. The main objective is to find a problem worth solving for a specific customer segment and to provide a proper solution, that has an impact on the customers’ lives. To make sure the solution is an enjoyable experience people love and use frequently, people need to be put at the center of the problem-solving exploration. Thereby, the risk of building something nobody wants can be reduced.

“Making products for your customers is far more efficient than finding customers for your products” — Seth Godin

To assure for a real impact on the project’s desired outcome we have to identify the target customer segment. They make up the most important variable within the project. Gaining empathy with the project’s target customer segment and truly understanding them will help making decisions based on findings — not assumptions.

Finding a problem worth solving

Problem Solution Fit

Finding a problem this customer segment has and is widely considered worth solving is crucial for the success of the discovery. By translating user feedback and observations into insights, we learn about their current experiences, pains, gains, needs, wants, desires and jobs they are trying to do. By this, in short, an existing problem can be uncovered. If we discover a problem we did not expect in the first place we must embrace and value it as an insight, ideally leading to a disruptive product innovation that has a real impact on peoples’ lives and, in turn, on the project’s outcome.

“Embrace unexpected discoveries”

By defining the problem the product is going to solve, the question “why do we build this product?” is answered. The answer defines the product vision. It gives the business opportunity meaning as it tackles real user needs. To find out if we are really solving the right problem for the target customers we need to test the user problem with a proper solution. In doing so, the problem-solution fit can be qualitatively validated.

Exploring a proper solution means creating a strategy how the problem will be solved. Based on both user insights and problem assumptions the possibilities can be narrowed down to the most promising and feasible solution. While testing the strategy, peoples’ interest in the product can be measured. From user feedback we should learn if there is any chance the product provides any value for the users. This helps to iterate on strategy, solution & value proposition to build the next iteration.

If we have built something of a certain value we need to test the product on the market with real data, because what people say they want does not necessarily equal what they really want and pursue. This is why the product-market fit is the next critical part in the product discovery process.

Finding Product-Market Fit

Testing Product-Market Fit

Steps, complexity, and timeline of product-market testing.

Given, we have figured out what to build we need to find out if the product is something people really want and use frequently. The goal of the product-market fit is to release a minimal version of the solution, iterate, experiment and improve it until it quantitatively proves both its user value and economic viability. We need to know if we are building the right product for the right market.

To build and release a minimum viable product (MVP) to the market that early users adopt very quickly and remain engaged with, we ship the core features we assume to offer the greatest user value. This can be done by measuring the number of people actually using and willing to pay for it. A proper product-market fit makes sure there is a market for the solution that can be monetarised. From this very first product version the core experience of the product needs to be extended and developed until the whole user experience becomes outstanding. The quality of the core features, the interactions, and the visual appearance have to be iterated and improved constantly.

Unfortunately, solely releasing a minimum viable product will not be sufficient. We need people to actually use the product. To get them on board, we must understand the path people need to take before they get to the product and remove barriers: “How do people get aware of it?” — “How do they come to use our product?” — “What can we do to remove barriers?”

“Ideas are cheap. Execution is the hard work”

Product Market Fit

While measuring if the released product version can change the key metrics, we see if our planned business goals can be achieved or not. We are looking for evidence that the product effects change in users behavior, makes users come back, use the product, and makes them willing to pay for it. After all, we have to ensure to have a viable business model in the long run. At the moment the product gets quantitative evidence of market demand it is time to grow the user base outside of the targeted customer segment.

Finding Distribution-Conversion Fit

Distribution Conversion Fit

Steps, complexity, and timeline of distribution-conversion growth.

Once we have found product-market fit we have to focus on the distribution-conversion fit. Therefore, the main objective is to successfully scale the product to accelerate sustainable growth — we do not want just more users, we want active users willing to pay. We need to attract a large base of new people, keep them engaged and convert them into loyal fans and paying customers. We are interested in and aiming at the mass market.

To attract new people we need to focus on distribution, onboarding, conversion, and sales: “How do we attract these people?” — “How do we get these people into using the product?” — “How do we convert these new users into loyal fans?” — and finally — “How do we sell the product?” We want to build a coherent way from peoples’ attraction over first contact with the product to frequent use.

“The best marketing isn’t advertising, it’s a well-designed and remarkable product.” — Seth Godin

To attract a large base of new people we must not wait for people to come. We need to discover adequate ways to reach out to people who have never heard of the product. As soon as we find a way to make people aware of the product, our priority is to convey the instant value of the product to them and to highlight why they will benefit from using it. The goal is to convert them into loyal fans, willing to pay for the product. Therefore, we must identify what keeps people from using the product and remove these barriers.

Distribution-Conversion Fit

As demand grows trough proper distribution, new customer segments will start using the product — people for which the original product was not made for. Very likely they will use the product in ways we have not imagined before and generate new use cases. Handling these new user groups becomes our biggest challenge at this point. How do we meet their needs? During this phase of growth we need to care about designing a product that works for all of the users, not only the early adopters. As we want to grow fast, adding new and relevant features for a more diverse user-group is the easiest way to keep growing. Quickly the most original features, built for our early adopters, experience less and less usage as they become overgrown in both user numbers and revenue by feature demands of other user segments. After some time we have to either revamp or remove the original features. The former specialised product becomes one of the mainstream products.

Conclusion

Building successful products is challenging. Most of them will fail. There never is a guarantee to be successful, but if we make sure to focus on problem-solution fit, product-market fit and distribution-conversion fit we can very likely reduce the risk of building something nobody wants, the risk of building something for the wrong market, and the risk of no sustaining growth at all. A proper product discovery and design process that puts the user in the center can make the difference. It might be hard, but it is not completely impossible to build the next big mainstream product everyone of us is dreaming of.

This post was originally published on Nikkel’s Medium profile.

Product and interaction designer at XING, Hamburg. Founder of Design Made For You. Follow me on Twitter @JAF_Designer.

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