Sometimes in debates I get with people over the whole Windows is better than OSX or Android is better than iOS or Windows phone, I just want to yell that’s because it isn’t designed for you.
The smartest companies in the world pick a segment of the market and own it, defend it and innovate for it. Perhaps the old adage proves true again that you can’t be all things to all people. Yet that is what so many tech companies try to do. They want to go after every segment of the market with a one size fits all design approach, thus spreading their products and their resources to thin.
What becomes of companies who try to go after every segment of the market is that the end up not being as good in areas where companies have focused. For example the iPad is not as good of an e-reader as the Kindle for various reasons. There are pros and cons to reading on both however for the serious reader of books, who has chosen that as the dominant use case, they will generally choose the Kindle.
There is a specific use approach to product development where a company or a technology just focuses on a limited set of use cases and makes the product the best for people to whom those use cases are valuable.
Car companies think like this. They don’t try to create a car that is all things to all people. If a car company tried to create one single car that appealed to those in the market for a truck, or a mini-van, or an economy car, or a luxury car, that car would actually be none of those things. Instead car companies develop cars for specific segments of a market.
Yet this is not how we build technology products. Currently we develop products that are all encompassing. All things to all people. That has gotten this industry pretty far, however in the future I believe technology companies who make personal technology products will need to think more like car companies.
For now however just starting by looking at the Law of Diffusion of Innovation is helpful.
What this image demonstrates is how the market segments are broken up at a high level using the law of diffusion of innovation. It also shows how large as a general percentage of the market each segment is.
The consumer of technology in each of the market segments has different expectations and uses with their technology. Therefore there is a lot of product fragmentation and differentiation opportunity in each of the market segments.
Designing a product for the innovators and early adopters is very different than designing a product for the late majority for example. Apple, I would argue, focuses on making products for the middle two markets in the chart above. The early majority and the late majority. That market consists largely those who are not tech elites but want products that “just work” and add value to their lives not make it more challenging.
Moving forward in this new world of computing where more than just the PC is an important part of the consumer ecosystem, tech companies need to understand how important it is to design for specific parts of the market rather than be all things to all people.
Great post, I would add a couple of things:
First, it is REALLY important to understand this when you are INSIDE companies that make things. I can’t tell you the number of times where my management would tell me that we needed to add a feature to a product that would satisfy them and would totally piss off the target customer. In those instances, my standard reply is “sure you would like it but you’re not the customer!” which would often get me in trouble since I worked for these people…
Second, as a market matures it also subsegments into narrow groups. The automotive market is a perfect example of this. I don’t drive an SUV, but I do know that there are people who like them who would never own a two-seater. This again points to the importance of knowing that adding a bunch of cupholders to a car is probably good in minivans and SUV’s but not really in a Boxster.
-bill
As always thanks for the thoughts Bill. I think the market maturity and inevitable fragmentation is one of the more powerful and mis-understood elements.
I agree with the car analogy. I have been studying the car industry from where it started to where it is now with consumer maturity and adoption and I find the parallels with the technology industry fascinating.