How to Handle a Failed Product Offering: Lessons from Windows 8

May 24, 2013

How to Handle a Failed Product Offering: Lessons from Windows 8
Windows Blue Rides To The Rescue, Will Microsoft’s Customer’s Forgive Them For Windows 8?

Backtracking Gracefully from a Failed Product Offering: Lessons from Microsoft

Every company has a failed product. Apple had the Newton, Microsoft had Vista and now Windows 8. General Motors nearly sank their Cadillac division with too many half baked products.
It happens to everyone, but what is the best way to handle the ensuing fallout?
We have a good case study from Microsoft’s experience with Windows 8.
Windows 8 has been universally panned in the news for being too disruptive to the traditional PC (consumer and enterprise audience) and betting the farm on touch enabled devices. By taking away the traditional desktop that dates back to 1995, users were completely confused. Further, most of the existing Windows user base does not have touch enabled screen, so they were forced to use a mouse that results in a confusing experience.
To add insult to injury, Windows 8 has been compared to New Coke, yet another ill advised change that was forced on the consumer. The consumers revolted and Coca Cola was forced to bring back Coke Classic.
So, what are the options companies have when they are in a position like Microsoft’s?

1) Stick to Your Guns

Seek to educate the marketplace on why the your product deserves a fair shake.
In the beginning, Microsoft seemed to be taking this path. They launched a massive media campaign to show Windows 8 as the next big thing (cue the annoying Surface commercials). When I tried out a Surface RT they included a “free” guide to Windows 8 that was pretty hefty. While I am a long time PC user my immediate impression was, “If you need to include a 100-plus-page book to explain how to use your software you have a problem.” Unsurprisingly, the PC community reacted in the same way.

2) Tweak What You Have to Address Some of the Main Complaints

With the announcement of Windows 8.1 aka “Windows Blue” it seems Microsoft is iterating quickly to salvage their investment in Windows 8. Windows Blue is rumored to give users the option to boot directly to the normal desktop and improved functionality for the traditional PC user that uses a mouse to navigate.
Steve Sinofsky the former Windows President who was in charge of Windows 8, wrote a blog post the other day that illustrated Microsoft’s dilemma. Here are some key excerpts from his post:
If you listen to customers (and vector back to the previous path in some way: undo, product modes, multiple products/SKUs, etc.) you will probably cede the market to the new entrants or at least give them more precious time. If technology product history is any guide, pundits will declare you will be roadkill in fairly short order as you lack a strategic response. There’s a good chance your influential customers will rejoice as they can go back and do what they always did. You will then be left without an answer for what comes next for your declining usage patterns.
If you don’t listen to customers (and stick to your guns) you are going to “alienate” folks and cede the market to someone who listens. If technology product history is any guide, pundits will declare that your new product is not resonating with the core audience. Pundits will also declare that you are stubborn and not listening to customers.
All of this is monumentally difficult simply because you had a successful product. Such is the price of success. Disrupting is never easy, but it is easier if you have nothing to lose.
It’s important to consider the impact of a disruptive product. Change can often be good, but as Sinofsky says, there is a price that has to be paid.
For Microsoft, they risked alienating the majority of their user base who hadn’t yet adopted a touch enabled PC. It seems Windows Blue will attempt to mend fences, but the jury is out on whether Microsoft can salvage Windows 8.

Corporate Strategy, Sales Operations

Sudip is in charge of Corporate Strategy, Sales Operations at <a href="">Alegeus Technologies</a>. Previously, he worked at OpenView from 2012 until 2014 with portfolio companies to provide insights on the markets they operate in, their customers, and drive development of business strategies.