Economic Landscape and Goods Acceptance and Persistent Utilization
In today's dynamic environment, designing and launching a successful product is no easy feat. Economic, political, social, cultural, and technological factors can all play significant roles in a product's adoption and continued use.
Economic environments, with their rapid changes, pose a challenge for designers planning for economic swings. This complexity is evident in the case of Nokia, the world's leading handset brand, which failed to adapt to the smartphone revolution and ultimately ceased making handsets.
Technological changes are another critical factor. Adapting to these changes is crucial, as failure to do so can leave products out in limbo, as demonstrated by the Segway, a two-wheeled motorized vehicle that encountered numerous market adoption problems due to the legal environment of nations not having a classification for Segway as a vehicle.
Political environments can be hard to predict, and changes in law or regulatory regimes can impact market adoption of products. Uber, the taxi app company, has faced regulatory challenges around the world, demonstrating the impact of political environments on product adoption. Large companies may be able to influence the political environment through lobbying, but small companies should be aware of the political environment and any challenges it may present prior to developing products.
Market ecology, a field of study, emphasises that products interact with their environments. Failing to account for those environments during product launch or iteration can prevent adoption of the product or destroy a successful product. This concept is underscored by the example of Kodak, once a great camera and film company, which failed to adapt to the arrival of digital technology, leading to the failure of their business model (ironically because Kodak developed the first digital camera).
Cultural factors also play a role. A design that is perfect for a Western market may be rejected by Chinese consumers due to cultural reasons, such as the number four being associated with death. Don Norman, a renowned designer, argues in his article "Does culture matter for product design?" that while culture may be less important than it once was, it should not be ignored completely.
Social environments in the modern era consist of both direct (friends, family, colleagues) and indirect digital social networks. Digital social networks can be utilised by designers and marketers to drive product adoption. An example of this is General Electric using social media with their "imagination at work" strategy to tap into audience innovation and create easy-to-adopt experiences.
Jeremiah Owyang, partner at the Altimeter Group, states that social networks reflect human behavior: connecting and sharing. This behaviour can be harnessed to drive product adoption, as seen in the case of companies that failed to respond to technological environmental conditions, resulting in loss of adoption and success. Examples include WeWork, which suffered a massive decline after its IPO was canceled due to governance issues under founder Adam Neumann, leading to a market value drop from a potential $47 billion to $4 billion; and many firms struggle to realize positive effects from AI adoption due to insufficient internal adaptation and employee engagement, as seen in a case where an insurer's poorly implemented AI fraud detection caused customer dissatisfaction despite initial financial gains.
In conclusion, understanding and adapting to the complex and rapidly changing economic, political, social, cultural, and technological environments is crucial for product success. Taking an "ostrich burying its head in the sand" approach towards technological disruption will lead to adoption failures and failures of existing products. Embracing change and utilising digital social networks can help drive product adoption and ensure continued success in today's dynamic world.
