Origin of Humans, Consumer Products, and Natural Adoption
We may never truly know the origins of life on earth. Let’s imagine some unknown reaction generated a single cell organism, and after many millennia developed into multicellular beings. Through constant iteration and adaptation to various habitats, the resilient few organisms who handled their surroundings were able to outlive the masses — the basis of Darwinism. Continue the process for quite some time and you get what we humans are now: the most sentient and self-aware creatures on this planet. In this way, human beings are the earth’s greatest product.
We can view consumer applications through this lens. The successful ones all started by having one common attribute: surviving and iterating in the unicellular stage until they provided enough utility to take off. Some products provided superior value right out of the gate and caught on immediately, like uber and facebook. Most needed several rounds of iteration before hitting the point of hockey stick growth (instagram, snapchat).
Increasing adoption rate and generating the potent word-of-mouth effect is incredibly difficult because the core product has to be better than the alternatives by 10x (i.e. whatsapp over SMS; better in nearly every way). If it isn’t, early users won’t be as motivated to convince their friends and family to switch over.
Many startups have flawed strategies and resort to spending cash, branding and celebrity endorsements for growth, which are like covering zits with makeup. Sure these strategies will drive downloads and get numbers in the short-term, but with consumer products, usage/retention is the key metric to pay attention to. Who cares if the application has thousands of downloads if less than 10% of those people come back monthly? Less than 1% of them come back daily? Is the product actually filling a need in the target user’s life?
The best products align with our day-to-day lifestyle. They find a unique way to fit in naturally and don’t ask to change behavior (because we most likely won’t). They take our current activities and make it easier to do or less painful. Notice that with the consumer applications we love and use often, they complement our habits in a congruent manner, taking the most direct approach from action A to result B. They don’t force any perpendicular or unnecessary steps, and render all current alternatives obsolete by a large degree.
One definitive example of a fantastic product built through repeated iteration is Airbnb; they legitimized the concept of renting rooms from strangers by adding authentication, optimizing for user preferences/wallets, and providing a simple interface. Starting with simple air mattresses and rooms, they attacked the NYC market and focused on making the process as seamless as possible. It’s straightforward goal and sophistication, one of the most powerful variables, helped them find their formula.
Extra features don’t have pull. Even if an app is built better technically (more efficient and scalable code) than an incumbent, users won’t shift to a new product because of a few less crashes and sharing options. An example of this was when facebook released Poke following the immediate and sharp rise of snapchat. It was the same thing but with facebook’s color brand, login, and extra features like reaction buttons. It initially seemed to do well at launch, but a few days later it tanked as Snapchat’s downloads and usage shot back up. People came to the hang out at the cool new snapchat’s party, and facebook attempting to divert a trending product’s usage with the same thing was a colossal failure.
Snapchat did it first and better than anyone else, and once they had that critical mass, they continued to build on top of that product core. (Snapchat’s evolution from a photo-sharing app into a fully-fledged media platform is a great topic for another time)
Ultimately, success with consumer platforms arrives through a TON of experimentation, iteration, and luck. Finding an important problem we face often, identifying a potential solution, releasing it to target users/customers, listening to feedback, and then repeating. Nearly all of these consumer startups that hit the billion dollar valuation emerged through the combo of efficiency maximization/pain minimization and taking advantage of leading technologies and platforms. For instance, uber was able to provide a dependable and convenient ridesharing service because their target audience all had GPS-enabled smartphones by 2010. Cloud storage was a hot trend, but it wasn’t until dropbox released their simple drop and sync folder technology that it became a popular consumer product. Carrying USB drives sucked, and dropbox made the hassle unnecessary!
Bottom line: find an annoying trend or problem that affects you on a daily basis, and brainstorm/experiment different ways to make it less painful.
- If this topic interests you, I strongly encourage you to examine a slideshow by a16z on network effects thoroughly. They meticulously analyze different growth strategies, explain misconceptions (namely between virality and network effect), and provide several easy-to-digest examples to highlight a treasure trove of data http://www.slideshare.net/a16z/network-effects-59206938
2. “Snapchat vs Facebook” designed by Frank Michael Smith
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