Don’t let your early triumphs drag down future sales success.
When you are working for (or starting) a new venture, you hope your solution is widely used, if not ubiquitous. You want millions of people utilizing your products, relying on your services and promoting your wares throughout the marketplace.
Truly successful firms may see this come to pass, while others may manage to penetrate and leave a mark on pockets of the market. With each new sale, that success grows and more and more of your “things” take their place in the world.
While you are in growth mode, every unit you move out the door is a good thing. You are not worried about what is going to happen three, five or ten years down the line because you’re worried about what’s happening this quarter and you are selling the latest and greatest.
Your R&D department may be working on the next version, and your account teams are reporting issues that you know must be addressed in the future, but those are problems for tomorrow. However, with every success today, tomorrow’s problems loom larger.
The Windows XP Example
… Windows XP, now 13-years-old and still the world’s second most popular operating system. It currently runs nearly 28% of the world’s PCs. Market research firm Gartner reckons up to a quarter of business systems and 10% of large organisations are still running XP.”
– From The Guardian
Since Windows XP debuted, they have released a number of new versions of their OS. But just because something newer and, theoretically, better came along didn’t mean everyone instantly upgraded. So now they have a legacy issue since, after 13 years, Microsoft finally announced they are no longer providing security updates for XP.
Of course, when you are Microsoft, legacy issues are a revenue-generating opportunity as they can sell $200 per desktop security upgrade plans and then eventually just force everyone to buy Windows 8 anyway. But when you are a smaller operation, your legacy can create some other issues.
Three Legacy Negatives & How to Mitigate Them
“Why Can’t I Buy More of the Same Kind I Already Have?”
Despite the fact that “Version 2.0” has 29 new features and improvements, it is still something new and different for your customer. It also may not “match,” creating aesthetic concerns.
To address this particular conundrum, you can take one of two routes: Offer to replace the existing models with the new ones for free or at a significant discount or give customers adequate notice so they can stock up on the old model before it is no longer available. But that second option may cause some problems downstream when you consider the next two legacy negatives.
Legacy Compatibility Issues
If your solution relies on a third party and they go away or stop supporting something you relied upon, you now have to upgrade everything in the field, often at your own cost. And your design has changed significantly, that may mean designing and building new parts just for old devices, or writing new code for things you don’t even sell anymore.
You can minimize the impact of this by doing a full technology lifecycle assessment before your first version hits the street, including talking to your vendors and getting a commitment from them for ongoing support. You should also be fully prepared to upgrade anything you have let into the wild that your customers expect will still work, which might be a big expense for products that are no longer generating much direct revenue.Tarnishing Your Image
Once you sell something to your customer, you can’t stop them from using it and in many cases it may be something you don’t really want people to see anymore. So even though you are thinking “we’ll sell this for a year and then put something way better out,” every unit that ships will stay out there, somewhere, giving potential and current customers a negative impression of your brand.
If you are only releasing a small number of products into the wild for a proof of concept or limited “version 1.0,” you should plan on replacing all of them with version 2.0… on your own dime. Additionally, your customer service and account management teams should be constantly keeping up with the elder statesmen of your install base and not just focusing on the shiny new customers. Proactive support, cleaning, upgrades, etc. will avoid those early sales successes from coming back and torpedoing future enterprise deployments.
These older customers will be references for you… even if you’re not actively promoting them as such since careful buyers will reach out to them to research how your products hold up over time.