Product series

Differences in a series of products

Product series is a when a company takes a single product and improves it over the course of time, gradually releasing new versions to the market. This is often based on the ability to build on previous experience and is a very good way for companies to differentiate their offerings in the long term. Since the lifecycle of the product doesn't end as fast as it normally would, the product itself becomes more memorable in the mind of consumers. They can learn its characteristics, the philosophy behind it, the new type of services that this product enables and expect that they will be kept in the future too. When such familiarity is combined with innovation, the company rarely learns the same thing. It's this unique knowledge gathered over a long period of time that allows it to gain competitive advantage. Understanding customer behavior and feeding that understanding back into the product is useful not only in big companies, but in startups as well. Only that in startups it must happen much faster or they may not survive.

The knowledge of the product in use allows the company to adjust its existing internal processes in order to tackle customer complaints about potential problems. When the company invents a new product, where it will no longer be possible to use the hardly learned knowledge, it will often need to change its processes, which can be time-consuming. And creating new and unproven products is always risky. In a sense, product series minimize this risk.

The product versions in a series are defined by some perceived difference of improvement (∆) that likely indicates whether people will want to buy. This metric needs to remain consistent from version to version (∆1 ≈ ∆2 ≈ … ≈ ∆n) or the interest in the whole product series will be affected. A perception about a new product version affects the perceptions of the older versions of the same product (backpropagation). How we see the latest version is how we start to think of the first. It's hard to create series of products that are equally revolutionary. Very often we see ∆1 > ∆2 > … > ∆n which is a sign that the product nears the end of its life. As good as the product series initially was, it may cause complacent thinking later, because it was often by keeping the series that the company was able to sustain its future.

The additional price that people will be ready to pay for a certain improvement will need to be equalized as well (price-improvement) if it is to be perceived as fair. Just because a new version is released doesn't mean that people will be ready to pay for all the costs of the previous ones. Price needs to be justified in relation to what the improvement brings and not just be based on intransparent decisions. Companies that create product series try to sell not only the product, but its popularity too, which can quickly lead to unrealistic prices in relation to the added value that comes from the improvement of the product. Then we should not wonder why clients are progressively less interested in series over time.

Product series also convert initially innovative products into commodities. High availability means lower prices and less profitability for any company. Without new innovations that find another form, company profitability will always tend to fall to zero over time.

Improving an existing product can't be the answer to every situation, even if this deepens our existing knowledge and experience. We also need to expand them.