When Customers Hit Back
Companies know that in order to please their customers, they have to provide them with the products that they want. But sometimes, companies don’t do this and ultimately end up falling foul of the very people they are trying to serve. With 96 percent of businesses failing within 10 years, it’s a serious problem and one that needs serious solutions.
Customer Hit #1: Your Product Is No Longer Relevant
There’s nothing worse than waking up one day and realizing with existential terror that the product that supported your business for so long has just been made obsolete. This is how Nokia felt when the original iPhone was released back in 2007. The giant Finnish tech company had been the darling of the mobile phone industry, but as soon as Apple launched the iPhone, people lost interest in their old, dumb handsets, regardless of how simple to use they may have been.
A similar thing happened to Kodak. What was so ironic about Kodak is that the company actually invented the thing that ultimately killed it - the digital camera - back in 1971. But the company’s board decided that it was a stupid invention that would never catch on since the first digital camera were the size of kitchen microwaves. What Kodak didn’t realize was that digital technology was making it possible to make everything smaller and that by the late 1990s, it would be possible, not only to build a handheld camera but also upload photos from them onto personal computers too.
Between 2000 and 2010, Kodak went from employing 300,000 people to just a few thousand, all thanks to the fact that its film industry was made obsolete by new technology. Customers, it turned out, preferred digital cameras to conventional film.
Entrepreneurs, therefore, need to think carefully about the problem that their company solves, rather than the product that it offers. Kodak thought in terms of products, rather than problems, and lost.
Customer Hit #2: Your Product Is Faulty
Recently, the home appliance giant Whirlpool has been in trouble in the media. It turns out that for years it’s been selling washer-dryers which can spontaneously combust, posing an untold risk to consumers and their families. Since the news came out about the dangers of Whirlpool’s washer-dryers, demand for the brand’s products has taken a tumble - literally. Because of the damage that their dryers caused to people’s property, Whirlpool ended up with a big legal bill, again underscoring the importance of taking out product liability insurance. Entrepreneurs, if they want to be successful, need to learn the lessons of companies like Whirlpool. Products should be tested and then tested some more in multiple different environments to make sure that they are safe.
Customer Hit #3: You Ticked Off Your Customers
Finally, companies can get themselves into trouble, not because of any problem with the product, but just because they ticked off their fan base. Take what happened when Maxis released the computer game SimCity in 2013. The game itself wasn’t very good, but the main problem was that users had to be connected to the internet to be able to play it, even though it was single player. The community reacted, and the game flopped.
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