Guest Post: To Kill a Product: Why, When and How, Part 1/3 | On Product Management

29/05/13 10:13

On Product Management
Write For Us Resources Associations Blogroll Books Downloads Company Directory Events Advertise About Us Contact Us Ask On Product Management Submit a Services Company Submit a Blog Submit an Event

Guest Post: To Kill a Product: Why, When and How, Part 1/3
Posted in Business Topics, Enterprise Software, Guest Blogger, Organization, Product Management, Product Marketing - 24 August 2009 - 23 comments
2 Rate This 0

Note: This is the 1st of a 3 part series of articles by guest blogger Chris Brown. If you feel inspired to write a guest post of your own, click here to find out how to submit it to us.

To Kill a Product, part 1: Why?

Its there somewhere, in the quarterly business review, a line item that shows a couple dozen customers, down from a year ago, which was down from the year before. It brings in a little revenue, probably less than a percentage point of total, but revenue being revenue, why not keep cashing the checks? It, of course, is the Product That Wouldnt Die, its longevity no longer due to any real practical purpose but to managements reluctance to pull the plug. But pull the plug they should. Even if costs are
http://onproductmanagement.net/2009/08/24/to-kill-a-product-why-when-and-how-part-13/ Pgina 1 de 13

Guest Post: To Kill a Product: Why, When and How, Part 1/3 | On Product Management

29/05/13 10:13

negligible (and sometimes theyre not), ineffective products divert focus and resources from core and growth products, and ultimately dilute the overall value proposition of the business. The role of the product manager includes performing the kill analysis thoughtful, thorough and completely unbiased and, if necessary, making a recommendation that is best for the business.

Why the hard decision might be the right decision

Why should an organization kill a product, particularly if it generates even a small amount of incremental revenue? The first reason should be obvious: The product isnt profitable. But products that are clearly bleeding money are not what were really discussing here. The harder decisions have to be made for products that have some revenue, some customers, have low or justifiable costs, but no long-term plan, prospects or strategic relevance. Here are some examples of how a moribund product can have a draining, distracting effect on an organization and its customers: On the Product team: Product managers and analysts are required to field customer feedback, analyze market data and track KPIs for a product that most likely represents a tiny fraction of the companys business, and takes focus off of supporting the profitable products and, more importantly, new product discovery and innovation. While the beleaguered product manager is trying to keep a past-its-prime product on life support, her competition is dreaming up the next big thing. On Sales and Marketing: The sales team needs to be trained on a product that very few customers actually use. Often dying products are more complicated than theyre worth (hence, why theyre in decline) and therefore can require a disproportionate amount of time and knowledge to effectively sell and support. Marketing, in addition, needs to account for these products in their collateral and messaging, adding not only to expense, but to the clutter theyre continually tasked to cut through. On Customer Support: The best customer support teams are fluent in all the products in your companys portfolio, even those with a small number of customers. But customers of troubled products can often fill up a Customer Supports team queue, generating a disproportionate number of phone and email support tickets. Meanwhile, customers of more profitable products are left on hold or waiting for their email response. On Technology: Not only can there be hard technology costs associated with supporting a product, such as server and bandwidth expenses, but also the time required to maintain both internal and external (e.g. customer-facing) processes. After all, if a product breaks, even one with relatively few customers, someone has to fix it. On customers: With customers theres a risk that the poorly performing product becomes a customers focal point, and that its performance, presumably poor, will be used as ammunition in contract negotiations or, worse, as a proxy for all the companys products. This can present considerable sales challenges and erode the companys reputation. All of these distractions have associated costs, which can be harder though not impossible to quantify. If a kill decision is particularly contentious, it may be necessary to put a dollar amount on these costs, which can be calculated by multiplying the number of hours spent supporting the product by the estimated hourly salary of the individuals doing the supporting. The most important reason why ineffective products need to be killed, though, is because they dilute the
http://onproductmanagement.net/2009/08/24/to-kill-a-product-why-when-and-how-part-13/ Pgina 2 de 13

Guest Post: To Kill a Product: Why, When and How, Part 1/3 | On Product Management

29/05/13 10:13

companys overall value proposition. If you can measure the total value your products deliver (and you should), perennially poor performing products will naturally drag down the sum of that equation. And with that downward pressure on value come declines in employee morale, confidence in senior management, and customer loyalty. No one wants to manage a dying product. No one wants to sell, support or, certainly, buy a dying product, either. To preserve its overall value, focus resources on core initiatives and customers, and maintain a vibrant workplace, a company should be willing and able to quickly put underperforming products to pasture. - Chris Brown Chris is vice president of product management at Apartments.com, a division of Classified Ventures, LLC. Email him at cbrown@apartments.com or follow him @Brown784

Coming up in this series:

Part 2: When is it time to kill a product? Part 2 offers up six areas to keep an eye on for telltale signs. Its examining these areas that will help product managers build the case to kill or keep a product. Part 3: How do you kill a product? Youve made the decision to pull the plug, now follow these steps to ensure a smooth sun-setting process.

You may also like -

We turned 5 years old this week!

How to hold a Kickass Virtual Customer Meeting (part 1)

How to Hold a Kickass Virtual Customer Meeting (Part 2)

Onboarding Product Management Mind the Gap

Happy (belated) birthday to us (again)!

5
Share

2
Tweet this

If you enjoyed this post, please consider leaving a comment or subscribing to the RSS feed to have future articles delivered to your feed reader. Me gusta
0

Related posts: 1. 2. 3. 4. 5. Guest Post: To Kill a Product: Why, When and How part 3/3 Guest Post: To Kill a Product: Why, When and How, Part 2/3 Guest Post: Measuring Product Management (part 1) Guest Post: Measuring Product Management (part 2) Guest Post: Measuring Product Management (part 3)
Pgina 3 de 13

http://onproductmanagement.net/2009/08/24/to-kill-a-product-why-when-and-how-part-13/

Guest Post: To Kill a Product: Why, When and How, Part 1/3 | On Product Management

29/05/13 10:13

Tags: End of Life, EOL, Product Lifecycle

23 Responses to Guest Post: To Kill a Product: Why, When and How, Part 1/3

1.

Mike Boudreaux says: August 25, 2009 at 2:34 am 0 0 Rate This One of the problems with quantifying associated costs is that Finance will typically factor in a cost allocation when creating the products income statement. The most common method for doing this is to take the total costs of each of the groups (Product management, Marketing and sales, Technology, Customer support) and then allocate these costs based on the weighted revenue by product. And so, if your old decaying product has diminished sales then the allocated costs will be diminished as well even if the product is still weighing down your organization. Maybe, by luck your allocated time will be correlated with the revenue, but probably not. You can create your own P&L estimate based on different assumptions, but in many companies this can create major problems with management if you dont use consistent numbers from what theyve seen before. Even if you get buy-in and support from Finance, be ready to back up your assumptions and bridge the gap between reported figures and your analysis. There can also be a great deal of emotion tied to killing off products. Make sure you know the political landmines and the history of your executive team. It could be that the product is the baby of your bosss bosss boss and thats how he got where he is. Also consider other stakeholders such as a services manager who is making a killing supporting the dying product and who will want to protect their P&L metrics. Usually, the customers that are buying your decaying product are existing customers who cant bear the switching costs to move to the next generation product. They might even be buying your old junk AND your new stuff. Before euthanizing the old junk, you should consider how to migrate your installed base to the new stuff. Im looking forward to reading Parts 2 and 3. This is a great topic.

Reply 2. OnProductManagement says: August 25, 2009 at 12:00 am 0 0 Rate This Article: To Kill a Product: Why, When, and How part 1 http://bit.ly/ZJTMX via guest blogger @Brown784 #prodmgmt #prodmktg #tech #leadership Reply 3. Tim Grace says: August 25, 2009 at 1:32 am 0 0 Rate This RT @onpm: Article: To Kill a Product: Why, When, and How part 1 http://bit.ly/ZJTMX via guest blogger @Brown784 great post from my boss
http://onproductmanagement.net/2009/08/24/to-kill-a-product-why-when-and-how-part-13/ Pgina 4 de 13

Guest Post: To Kill a Product: Why, When and How, Part 1/3 | On Product Management

29/05/13 10:13

Reply 4. Joshua Duncan says: August 25, 2009 at 2:05 am 0 0 Rate This RT @onpm: To Kill a Product: Why, When, and How part 1 http://bit.ly/ZJTMX via guest blogger @Brown784 #prodmgmt #prodmktg #tech #leadership Reply 5. Dov Bigio says: August 25, 2009 at 2:09 am 0 0 Rate This Como "matar" um produto parte I http://bit.ly/3HRQ63 #prodmgmt Reply 6. imbertti says: August 25, 2009 at 2:45 am 0 0 Rate This RT @onpm: Article: To Kill a Product: Why, When, and How part 1 http://bit.ly/ZJTMX via guest blogger @Brown784 #prodmgmt #prodmktg #tech Reply 7. Chris Brown says: August 25, 2009 at 3:17 pm 0 0 Rate This Tweeting my own horn: Guest blog post on why, when and how to kill a product: http://bit.ly/ZJTMX. Thanks @onpm ! Reply 8. Matt Stratton says: August 25, 2009 at 3:30 pm 0 0 Rate This RT @brown784: Tweeting my own horn: Guest blog post on why, when and how to kill a product: http://bit.ly/ZJTMX. Thanks @onpm ! Reply 9. Robin den Buurman says: August 26, 2009 at 10:26 am 0 0 Rate This Thanks, great article! looking forward to Part 2 and 3! Reply 10. Olav de Swaaf says: August 26, 2009 at 7:54 am
http://onproductmanagement.net/2009/08/24/to-kill-a-product-why-when-and-how-part-13/ Pgina 5 de 13

Guest Post: To Kill a Product: Why, When and How, Part 1/3 | On Product Management

29/05/13 10:13

Rate This

RT @tiggero1111: Why kill a product? http://bit.ly/ZJTMX Reply 11. Chris Brown says: August 26, 2009 at 3:54 pm 0 0 Rate This Thanks, Robin! Mike, great points. I definitely agree that weighted costs allocations are not the way to go. Performing your own analysis may be politically perilous, but thorough, conservative, welldocumented assumptions should hold up. All you can do is put your best foot forward and hope the executive team appreciates the effort. And re: the emotional ties, this is absolutely the biggest hurdle Ive seen. In Part 3 I talk about how communications is tantamount, and how making sure all stakeholders know the full set of decisionmaking criteria that this is not a random or cold-blooded move, and that there will be tangible benefits will ensure a smoother sun-setting. Chris Reply 12. To Kill a Product: Why, When and How, Part 2/3 On Product Management says: August 26, 2009 at 5:42 pm 0 0 Rate This [...] This post is contributed by Chris Brown, Vice President of Product Management at Apartments.com. This the second in a three-part series that takes an in-depth look at that process and makes its own set of recommendations on why, when and how to kill a product. (Part 1 is here.) [...] Reply 13. Dheeraj says: August 27, 2009 at 5:00 am 0 0 Rate This Any products versions are a result of feature triages putting the must-haves in the latest version. Thus, the nice-to-have features are in the works while the sales and support teams are grappling with all sorts of feedback and tickets. Yet another team that is busy tweaking its services is the support infrastructure team (hardware, security, general admin etc.). With these variables in play, when a product / product line falters, it becomes difficult to really pin point the cause to a failing product or failing processes. It is also difficult to say if the processes are failing owing to the nature of the product. Why is it difficult ? Everybody is emotionally attached to what they have done and even leadership vision gets clouded.
http://onproductmanagement.net/2009/08/24/to-kill-a-product-why-when-and-how-part-13/ Pgina 6 de 13

Guest Post: To Kill a Product: Why, When and How, Part 1/3 | On Product Management

29/05/13 10:13

This has been one of the obstacles I have seen in the phasing out of products. While some members of the team are able to see that the problem originated in the envisioning of the product or that version, belling the cat is a step that sees a lot of procrastination. Oftentimes, sales and the product manager take a lead. These folks have to be really dispassionate. Reply 14. deepak says: August 27, 2009 at 11:50 am 0 0 Rate This Some time companies kill their existing blockbuster product although they are making money and mkt captalization because their positioning of product is shifted drastically. one of the example is Toyta stop their production of Qualis in india although that time Qualis is market leader and shifted from SUV segment to Passenger Car segment. Reply 15. Chris Brown says: August 27, 2009 at 2:07 pm 0 0 Rate This Dheeraj, Its an interesting challenge. You want product managers to be passionate about their products, yet I agree they have to be able to maintain some distance. They need to be able to cast a clear, unbiased eye on the situation. Thats where the KPIs can be helpful. If the metrics you follow are well chosen, then theyll tell the story pretty clearly. Thanks for the comment! Chris Reply 16. Pieter Gabes says: August 27, 2009 at 11:42 am 0 0 Rate This Reading: To Kill a Product, part 1: Why? http://bit.ly/ZJTMX Reply 17. Guest Post: To Kill a Product: Why, When and How part 3/3 On Product Management says: September 4, 2009 at 3:24 am 0 0 Rate This [...] Part 1 Why?: If its generating some revenue, even a little, why kill an underperforming product? Because ineffective products divert focus and resources from core and growth products, and ultimately dilute the overall value proposition of the business. [...]

http://onproductmanagement.net/2009/08/24/to-kill-a-product-why-when-and-how-part-13/

Pgina 7 de 13

Guest Post: To Kill a Product: Why, When and How, Part 1/3 | On Product Management

29/05/13 10:13

Reply 18. While you were out: Top GUEST posts of the summer from ON PM On Product Management says: September 8, 2009 at 10:40 pm 0 0 Rate This [...] To kill a product: Why, When, and How (3 parts, Chris Brown, VP PM at Apartments.com) [...] Reply 19. Rich Mironov says: January 3, 2011 at 9:12 pm 0 0 Rate This RT @onpm: @jockbu and this old byte, http://bit.ly/8ZmpXY on EOLing a product http://wp.me/pXBON-Lx #prodmgmt Reply 20. Hani Abughazaleh says: January 4, 2011 at 7:29 am 0 0 Rate This an excellent set of articles on how to manage under-performing products http://bit.ly/erMXM9 #prodmgmt via @Jim_Holland Reply 21. Product Camps: Where Do We Go From Here? On Product Management says: May 3, 2011 at 11:12 pm 0 0 Rate This [...] Plan some general Q&A sessions, panels and open sessions like How to Kill a Product [...] Reply 22. Karmic Coach says: August 19, 2011 at 12:40 pm 0 0 Rate This In light of HP's WebOS announcement, this- http://t.co/9zSN27d seems really timely. I cant help but wonder why http://t.co/8wNc8Y0 Reply 23. Michael Maretzke says: December 2, 2011 at 8:01 am 0 0 Rate This Ever asekd yourself when to sunset product features? > To Kill a Product: Why, When and How http://t.co/dycvybK8
http://onproductmanagement.net/2009/08/24/to-kill-a-product-why-when-and-how-part-13/ Pgina 8 de 13

Guest Post: To Kill a Product: Why, When and How, Part 1/3 | On Product Management

29/05/13 10:13

Reply

Leave a Reply
Your email address will not be published. Required fields are marked * Name * Email * Website

Comment You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym
title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>
Post Comment

Notify me of follow-up comments by email. Notify me of new posts by email.

search this site Search

Our Sponsors Click to visit their sites

http://onproductmanagement.net/2009/08/24/to-kill-a-product-why-when-and-how-part-13/

Pgina 9 de 13

Guest Post: To Kill a Product: Why, When and How, Part 1/3 | On Product Management

29/05/13 10:13

Resources

Associations Blog Roll Books Downloads Events Training & Consulting Companies

Categories
Select Category

Archives
Select Month

Recent Posts Product Management vs. Systems Analysis The Whole Product Manager Strategic Product Management Job Responsibilities or End Results? Does your content have a clear purpose? Market research is easy. Visit customers Recent Comments Weldon Godeaux on How to dominate your competition learn from Apple Mae on Product Management vs. Systems Analysis Prabhakar Gopalan on Positioning, messaging, and ownership Thomas Schranz on Books Karol McCloskey on The Whole Product Manager Contributors

http://onproductmanagement.net/2009/08/24/to-kill-a-product-why-when-and-how-part-13/

Pgina 10 de 13

Guest Post: To Kill a Product: Why, When and How, Part 1/3 | On Product Management

29/05/13 10:13

Right to License

Content on this site is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 Unported License. Meta Log in Archives May 2013 April 2013 March 2013 February 2013 January 2013 December 2012 November 2012 October 2012 September 2012 August 2012 July 2012 June 2012 May 2012 April 2012 March 2012 February 2012 January 2012 December 2011 November 2011 October 2011
http://onproductmanagement.net/2009/08/24/to-kill-a-product-why-when-and-how-part-13/ Pgina 11 de 13

Guest Post: To Kill a Product: Why, When and How, Part 1/3 | On Product Management

29/05/13 10:13

September 2011 August 2011 July 2011 June 2011 May 2011 April 2011 March 2011 February 2011 January 2011 December 2010 November 2010 October 2010 September 2010 August 2010 July 2010 June 2010 May 2010 April 2010 March 2010 February 2010 January 2010 December 2009 November 2009 October 2009 September 2009 August 2009 July 2009 June 2009 May 2009 April 2009 March 2009 February 2009 January 2009 December 2008 November 2008 October 2008 September 2008 August 2008 July 2008 June 2008 May 2008 April 2008 March 2008 February 2008 January 2008 December 2007 November 2007 October 2007 September 2007 August 2007
http://onproductmanagement.net/2009/08/24/to-kill-a-product-why-when-and-how-part-13/ Pgina 12 de 13

Guest Post: To Kill a Product: Why, When and How, Part 1/3 | On Product Management

29/05/13 10:13

July 2007 June 2007 Pages Write For Us Resources Advertise About Us Contact Us Copyright 2013 On Product Management. Entries (RSS). Clean Simple White Theme by Mazznoer. Powered by WordPress.

http://onproductmanagement.net/2009/08/24/to-kill-a-product-why-when-and-how-part-13/

Pgina 13 de 13