Collabosaurus founder and chief executive officer
Killing off an underperforming (idea, policy) product can sometimes feel like sending a beloved pet away ‘to the farm’. It’s tough, sometimes it’s necessary. But sometimes it can also be the start of something better. If you’re struggling with a decision to potentially cut off an underperforming product, I have three recommendations for you.
1. Simplify product offerings
If you’ve ever been to a weekend market where people are selling their old clothes on jam-packed, overwhelming racks, you’ll know the feeling of ‘too much choice’. How do your customers feel when they suss out your product offering? Is it curated, focus on value and simple? Does it speak to their pain-points? Often, an underperforming product is only underperforming because there’s simply too much noise, too much on offer. Perhaps you’re communicating yourself as a jack of all trades and a master of none.
2. Iteration over death sentence
Understand the true reason the product is underperforming. The best way to do this? Ask your customers! The Collabosaurus Pitch Portal feature was born out of a customer conversation where we saw Collabosaurus through new eyes. The feature has been our most impactful product iteration to date, attracting thousands of new leads in a few weeks.
3. Trust your gut
Sometimes it’s hard to let go of a product because of sunk cost — time and money. Our judgement is clouded because of the effort we invested in launching it, but deep down your gut knows what to do. Never underestimate your gut feeling!
AirTree Ventures co-founder and general partner
For most products, there is a short period where product-market fit might not be clear and small modifications in the offering dramatically change the engagement and usage of the product or service.
Allowing for a short period of recalibration if your product is still not providing very happy customers who are increasing their use, happy to renew (so churn is <maybe 10% annually) and happy to offer positive reviews, then maybe you really have not created a product that customers really care about.
Perhaps time to move to something else.
Luxury Escapes co-founder, angel investor and former corporate lawyer
Killing underperforming products is much like firing a terrible (or even below average) employee — afterwards, you always wish you had done it sooner.
Successful entrepreneurs are, by their nature, highly empathetic. To be able to build a successful business and understand your customers you need to be.
A corollary to that is we tend to be too empathetic in how we run our businesses as well. Hoping that poorly performing team members will somehow ‘come good’ (hint: they never do).
A poorly performing product is similar — you invest in a product like you invest in a team member. It’s a calculated incremental risk. The difficulty is, a bit like a poker game, we tend to treat monies paid as ‘sunk’ and focus purely on the small marginal additional investments.
Investment in products is no different to investment in businesses, you need to do a discounted cashflow estimate — that is, based on the money and time we’re spending, and how much will this investment pay us back.
The key is being hard-nosed about data. If customers don’t like your product and you’ve spent time and money marketing it, you need to kill it. Like a poorly performing team member, it’s very rare that a poor product will suddenly become popular. While the decision to initially invest will be down to you, the decision to continue investing will be made by your customers. And in this case, they are absolutely never wrong.