Hey look, the new iPhone x has just come out. Or maybe it’s the new Samsung Galaxy y. Yea! Umm, I sure do like that shiny new thing, but I think that I’ll wait awhile or maybe I’ll skip this generation and go for the next one. Oh wait, my current phone all of sudden sure seems slow. I guess that I’ll go ahead and buy the latest phone because it will probably be faster than this slow one that I’m all of sudden using. Is it possible that cell phone product managers are manipulating us in order to get us to upgrade our phones?
The Problem With Upgrades
The product that you are offering to your customers is a great product! However, as every product manager knows, this product is a temporary thing. It will not stay the same because we are always changing things making our products quicker, better, faster. What this means is that in a week, a month, or even a year we’ll be updating our product development definition and offering the next version of our product to our customers.
This puts us in a tricky position. I mean, we are thrilled and pleased that our existing customers have purchased our product – that’s why we are able to still offer it and have the funding to continue to make it better. However, now we find ourselves in a bit of a bind. Our existing customers are using an old version of our product. What we would really like them to do is to stop using that version and start to use the new version that we have just come up with.
When our existing customers are using an old version of our product, it means that the cost of supporting our product has just gone up. Now we have to support two or more version of the product at the same time. We may also have to release updates to the old version of the product if something important is discovered to be wrong with it. Ouch – that’s not going to look good on our product manager resume. Why can’t our existing customers just see how cool the new version of our product is and go ahead and upgrade?
The Problem With Cell Phone Upgrades
This is exactly the same problem that cell phone product managers have run into. When the next version of their cell phone product rolls out, they would really like to not only win over a lot of new customers but also convince all of the people who are using the previous version of their product to pitch their cell phones and upgrade .
Sendhil Mullainathan is a Professor of Economics at Harvard University. He’s noticed that every time Apple rolls out a new iPhone, it sure seems like his current iPhone slows down. He spent some time wondering if indeed it was possible that the product managers at Apple were deliberately slowing down older phones so that people would buy the new ones. In the end, he reached the conclusion that it was the accompanying upgrade of the cell phone operating system that was probably slowing older phones down.
For the rest of us, this poses an interesting question: when we release a new version of our product, is it ethical to make previous versions of the product operate less efficiently so that our existing customers are more motivated to upgrade to the latest version of the product. As attractive as this idea is (come on, admit it – you’d love to do this), it’s probably not permitted. All it would take is one customer figuring out what you are doing and your credibility would go out the door. Instead, a much better way of getting customers to upgrade is to make the next version of the product so desirable that they just must have it. Then price the upgrade so that it becomes a foregone decision that your existing customers will be willing to switch to the latest and greatest version of your product.
What All Of This Means For You
Product managers face a problem every time they roll out a new version of their product. When the new version becomes available, they will have to continue to support older versions of the product because that’s the version that their existing customers will be using. This boosts costs and takes resources away from creating the next version of the product. There should probably be something in every product manager job description that says that we need to be able to get existing customers to upgrade.
Many users of iPhones have noticed that their phones seem to slow down when a new version of the iPhone is released. Although it turns out that nothing is being done to make this happen, it does bring up an interesting question as to just exactly how far product managers can go to motivate existing customers to upgrade. Effective ways to make this happen include including desirable features in the next version of the product and pricing it in a way that it makes it easy to make the upgrade decision.
As product managers, we don’t often get involved in having to make ethical decisions that are as clear cut as this one is. Yes, it would be tempting to build a self-destruct mechanism into our products that would cause our customers to want to upgrade to the latest & greatest version of our product. However, we need to resist this urge and instead take the ethical path of making upgrades both desirable and affordable for our customers.
Question For You: How often do you think that you should come out with upgrades for your prouduct?
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What We’ll Be Talking About Next Time
So do you have a mobile phone? I’m willing to bet that yes, you do. No matter if you have decided to go down the iPhone route or if you’ve taken the Android path, once you get past the pretty screen that your phone came with, what probably attracted you the most were all of the applications (“apps”) that you could run on your new phone. I wonder if the Product managers who are responsible for those apps would be willing to share any of their secrets with us that would help us to boost our product manager skills?