A version of this article previously appeared in Fortune magazine.
In case you haven't been paying attention, Apple has started shipping Apple Vision Pro, a headset that combines virtual reality (VR) and augmented reality (AR). This product is a masterpiece with amazing technology.
However, the product/market fit of this first iteration has waxed and waned.
I've seen other world-class consumer product companies make the same mistake.
- Inventing amazing hardware that creates completely new functionality
- Forecast demand based on previous consumer product quantities
- Confusing consumers by defining new categories without a frame of reference
- Discovering that your hardware doesn't match the needs of your existing consumer customer base
- Work hard (read: spend a lot of money) to “push” sales to existing customers
- Revenues are significantly lower than expected. Marketing and capital expenditures (new factories, high R&D costs) were predicated on consumer-scale sales.New products consume large amounts of cash
- Ignoring or not understanding adjacent niche markets that would have “taken” the product out of their hands if they had developed niche-specific demos and outreach
- Eventually, focus on niche markets that are interested in your product.
- Niche markets provide great beachheads, but are too small to match the inflated forecasts and burn rates built into consumer-scale sales.
- which one…
- Abandoning the product after multiple market shifts and leadership changes
- Pivot and continue
deja vu all over again
I was living a similar life in 1990 when Kodak (remember them?) released a product called PhotoCD. Kodak provides consumers with movie Save your photos to your home CDROM drive and display them on your TV. When you leave your film at a film processor, instead of getting a physical print of your photos, they scan your film and burn it onto a CD. I go home with his CD with photos on it.
I got a preview of PhotoCD when I was the director of marketing at SuperMac, a supplier of hardware and software for graphics professionals. As soon as I saw this product, I knew all my professional graphics customers (ad agencies, freelancers, photo studios, etc.) would want to use it. In fact, they would have paid a premium for it.Kodak introduces PhotoCD consumer product.
The problem was that in 1990, consumers didn't have CDROMs. drive View photos. At the time, most personal computers did not have these features either. However, while every graphics professional owned his CDROM drive, most did not own a high-resolution film scanner. PhotoCD was perfect for them. And it was the perfect launch customer. To this day, I remember a senior Kodak executive telling me: We also sell CDROM drives. (Kodak CDROM drives were about the size of professional audio equipment and cost between $600 and $1000 in today's dollars, depending on the model.)
(And when consumer CDROM drives became available, PhotoCD discs could not be played because they were encoded with Kodak's proprietary standards to lock them into the drive!) As a result, PhotoCD was a miserable consumer product. failed. The subsequent shift to professional graphics users, a segment that another division of Kodak was familiar with, was too slow as low-cost scanners and a non-proprietary standard (JPEG) became popular.
So what are the lessons for Apple?
- Apple is trying to push Vision Pro into its products existing consumer customer
- All demos and existing applications are aimed at consumer customers
- Apple didn't create a demo of how Vision Pro could be used. new market Users jump to buy Vision Pro. for example,
- There's evidence of adjacent mass-market demand ( here , here , here ) and it's helping millions of homeowners fix things around their homes
- There is evidence that there is demand for it in industrial applications outside of the consumer sector (here). Every company with complex machinery has been experimenting with AR for years. Imagine repairing a car with the Vision Pro AR tutorial. Jet engine maintenance. Or a whole range of complex machinery.
These all make great Vision Pro demos for training and remediation. It's hard to understand why Apple ignored these easy wins.
make it right
Apple's creation of new product categories (iPod, iPad, iPhone) and entry into new markets is unprecedented in modern corporate history, with $300 billion (75% of revenue) coming from non-computer products. hardware. In addition, they built a completely new subscription business model that exceeded his $85 billion. App Store, iTunes, Apple Care, Apple Pay, Apple Cash, Apple Arcade, Apple Music, Apple TV.
It's hard to remember, but the first versions of these products were released with significant limitations, which were fixed in subsequent versions. The first version of the iPhone ran only Apple software, was a closed system with no App Store, no copy and paste, and couldn't record video. The original Apple Watch was positioned as a fashion accessory. It wasn't until much later that Apple realized the Watch's killer app was fitness and health. Finding suitable markets for all these products while fixing technical flaws took time and effort.
The same seems to be true for the Vision Pro. Apple marketers will find that less familiar adjacent spaces will become their first “must-have” beachhead market. The new version will ride the wave of technology from lighter and cheaper versions.
Apple CEO Tim Cook made a personal bet on Vision Pro. More than any other company, the company has sufficient resources (cash on hand and engineering talent) to steer its product/market fit to the real markets that need it.
I hope they find it.
File: Customer Development |