Why great products fail
Airbnb is worth $30b today but not long ago the company was making just $400 per day. What changed? Laura Ryan explains why perfecting your product's service design is essential to success.
A great number of digital businesses fail because they’re rubbish. However many great digital businesses fail because they have not considered service design – the experience beyond the screen.
It may be hard to believe now but in 2009 Airbnb was close to going bust. On a mission to understand why it was bringing in revenue of just $200 per month, it became clear that the photos being used to display the properties were pretty grim. “People were using their camera phones or using their images from classified sites… you couldn’t even really see what it is that you were paying for,” said Airbnb co-founder Joe Gebbia.
To solve the problem, Airbnb decided on an approach that would undoubtedly improve the quality of photography and therefore the digital product, but would require an extra service component.
It involved travelling to New York, renting a camera, spending time with customers as they listed properties and replacing amateur photography with beautiful high-res pictures.
When Airbnb doubled its revenue that week – to a whole $400 – it was clear they were onto something. And so was born the free, Airbnb Professional Photography Service which matches property listers with local, professional photographers.
The service is a win for all – hosts generate more interest with schmicker listings, renters get a better perspective of the properties they are considering, and Airbnb makes more money through more bookings.
Stories such as this are a harsh reminder that even with a great digital product, if the service is perilous, or in the case of Airbnb, non-existent, it will have major impacts on the customer and ultimately, the business.
For brand, product managers, and marketers of all levels, it highlights the importance of looking at service design and product design simultaneously and holistically, if the customer’s user experience is to be maximised which will in turn deliver increased revenues for the business.
Why service design and product design cannot be separated
From an agency perspective it feels intuitively right to separate product and service design offerings, given the outputs of each focus are indeed different.
Digital product design focuses on the design and delivery of shippable digital products including user experience design (UX) and user interface design (UI). So, this is Airbnb – the place where you make the booking, transact, feedback and hopefully book again.
While as its name suggests, service design focuses on how that product is delivered to customers, considering the end-to-end service experience online and beyond the screen. This is the customer service that happens off the Airbnb website, disaster response, professional photography services and the like.
Whilst they may have different outputs, the objective of the two disciplines is the same – to solve a problem for the customer whilst delivering a commercial benefit to the business.
From a customer’s perspective, the decision to continue engaging with a product is the sum of their product and service experiences. One does not exist without the other, they coexist completely and some of the biggest brands in the world know it.
Consider Apple compared with every other PC laptop on the market today. PC laptops have improved leaps and bounds, however, the actual experience of upgrading and repairing a PC compared with an Apple can be frustrating.
Let’s say I buy my Lenovo laptop from Harvey Norman. I get a warranty from Lenovo to cover some parts and another warranty from Harvey’s to cover other parts of the product. Where do I go to get my laptop fixed? Compare this with Apple. I know to always take my laptop to an Apple Store where I know the problem will be solved by helpful people.
As a marketer, before deciding if you need a product or service design solution, here are a few things to consider:
What’s the problem?
The most important thing here is that whether your specialisation is service design or digital product design, you must remain agnostic in the problem discovery phase. It’s no help if the solution is a foregone conclusion. It’s also not useful to have a product designer blinkered to the possibility that the best solution may be a service design solution or vice versa.
Map the service journey
A service design blueprint is a great technique for mapping the customer journey and business flow, but so too are other product design techniques. Whether it’s a customer/business journey map, service blueprint or another technique, the objective is to accurately visualise the customer and business journeys in their current state, as a strategy for identifying gaps and opportunities.
Product designers should be using this technique because a product does not exist without service to support it.
Adopt design thinking
There is a general misconception that design refers to solving an aesthetic problem. Design is actually about problem solving. Design thinking is a framework for defining a product or service in response to a problem, rather than just trying to making something look ‘nice.’
Adopting human-centred design thinking means spending time defining the business and/or customer problem, testing several design solutions to refine a solution based on insights.
For product managers and marketers, the best approach when trying to solve a customer or business issue is to remain dispassionate about the solution. This means working to a framework that doesn’t put either product or service design first, but rather respects that the two coexist and the solution could be one or both.
When that occurs, nirvana is reached. Just ask the founders of Airbnb, their business is now valued at $30 billion.
Laura Ryan is a senior strategist at digital product studio Mentally Friendly
solid article Laura – thanks for sharing
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