Remember the Amazon Fire Phone?
If you don't, you're not alone. The smartphone was released last July to much fanfare: the front page of Amazon was slathered with ads for the Fire and its Dynamic Perspective technology, and the company sincerely believed it would gain foothold in the smartphone market. But Amazon was wrong. How wrong? Only three months after the device's launch, the company took a $170 million write-down attributed mostly to the Fire Phone's colossal failure.
Noble effort, terrible outcome: the Amazon Fire Phone.
Now, just slightly over a year past the device's debut, it's not even available for purchase on the company's website, and Amazon has been laying off its hardware designers. Oh, and what about the Amazon Fire TV? Also unavailable.
Flash back to the Zune, Microsoft's attempt at edging into the media player market back in 2006, a full five years after the original iPod was released. Microsoft attempted to win adopters by having a larger screen and high-profile licensing agreements.
The Zune in all its short-lived glory.
But it flopped. Majorly. Even a behemoth company like Microsoft is prone to missteps (Vista, anyone?), but though a tremendous amount of money was lost, makers can learn valuable lessons from these two tech failures.
1. If you're coming late to the party, you'd better bring something good.
The Zune was released 5 years after the iPod; the Fire phone debuted a good 7 years after the first iPhone. Amazon and Microsoft each hoped customers would be ready to abandon Apple, but they didn't really have compelling reasons for that hope. The Fire phone didn't offer breathtaking features or revolutionary technology: to users, it was just another black smartphone. The Zune had a bigger screen, sure, but customers already felt familiar and comfortable with the iPod: Microsoft didn't give a strong reason to abandon a technology that had already become a standard.
When makers arrive late to the game in saturated markets, they'd better bring a game-changer with them. A bigger screen doesn't count.
2. Mind your aesthetic.
The Zune was clunky and came in weird colors. Yes, it was a great piece of tech, but supermodels aren't valued for their insides. To customers, the way technology looks is just as important as how it works. The Fire phone is indistinguishable from every other smartphone on the market and lost out for that very reason. On the other hand, Apple is maniacal about their design for a reason: people care about the way their technology looks.
Spend just as much time on the outside as you do on the inside.
3. Know your brand.
Amazon is where people go to buy cheap vacuums and discounted books. To customers, Amazon is a market, not a maker. Expecting Amazon to produce a smartphone is a lot like expecting Albertsons or Trader Joe's to produce a stellar television set. As for Microsoft, it's still known primarily as a software company, not a handheld media device manufacturer. In other words, if you're known for making stellar keyboards, stick to making stellar keyboards. Once a brand is identified in a customer's mind, it's hard to re-associate it with producing something different than its primary product.
Don't branch out into unfamiliar territory unless the market asks you to.
4. Listen to what customers want.
The Zune was a cool product, but it would only sync with Windows devices, thereby alienating a good chunk of the consumer base who used Apple products. And it didn't have a touch screen. And it was clunky. And it was brown.
Amazon's unnecessary Dynamic Perspective.
And no one even asked Amazon to make a smartphone, nor did anyone need weird display technology. Makers need to listen to customer feedback, no matter how unpleasant, because they're the ones who are buying the product. 3D phones may be a cool idea, but not if they become more of a hindrance than a help.
Make sure your product enhances lives.
So yes, failures are incredibly costly, but the above tips will help make sure you avoid them. Especially if you suddenly decide to compete with the iPhone.