Why Developing a Product Against the Business Model Spells Trouble

In today's highly competitive market, developing a product that aligns with a company's business model is more important than ever. However, some businesses introduce features or changes that go against the fundamental principles of their business model, ultimately hurting their product and the user experience.

In this blog post, we'll explore why this approach is problematic, and we'll discuss examples that highlight the issues that can arise when a product is developed contrary to its business model.

The Importance of a Business Model

A well-designed business model is at the heart of every successful product. It outlines the company's strategy for creating, delivering, and capturing value, serving as the foundation for the product's development and growth. When a product is developed in alignment with its business model, it enables the company to achieve its objectives, satisfy customer needs, and maintain a competitive edge.

Conversely, deviating from the business model can lead to a host of problems, including customer dissatisfaction, decreased market share, and even the collapse of the company itself.

The Business' Model is the Soul of Your Product

On July 1st, Twitter - the popular social networking platform - decided to implement a limit on the number of tweets users could read. The CEO, Elon Musk, argued that this feature would improve the overall quality of the platform and mental health of their users.

He says it's temporary, and based on the date it occurred, it's possible that someone simply forgot to pay the monthly fee for the production servers. However, if this change becomes permanent, it will be a product suicide.

Such a change would directly contradict Twitter's - or any social network - core value proposition: the ability to read, share, and engage with content freely and without restriction. By limiting users' access to tweets, Twitter would be undermining the very essence of its product, alienating its user base, and ultimately damaging its brand.

What's a social network if users cannot participate in the network? What's your product without its soul?

The Business Model Tells You How to Improve

The business model will always indicate where your business is struggling and suggest processes that can be improved to align with your objectives.

Imagine a platform that charges users based on credits or on-demand usage, but each time they use it, they have to wait on a loading screen for 5 minutes and cannot perform other tasks while that job is executing.

Are you seeing it? Users are waiting for the results of a task, they are unable to use their credits for additional tasks, but you earn money with the credits spent by the users! This design flaw not only hinders user productivity but also contradicts the platform's value proposition of offering flexibility and convenience through a credit-based system.

The business model speaks for itself and guides the direction of the product.

The Consequences of Developing a Product Against the Business Model

When a company develops a product that contradicts its business model, it risks in so many ways.

Deviating from the core value proposition can leave users feeling betrayed or frustrated, making it difficult to maintain or grow a loyal customer base.

Additionally, introducing features or changes that contradict the company's values can tarnish the brand's reputation and make it difficult to attract new customers.

On the other hand, market is wild and when a product fails to meet user expectations or outperforms competitors, the company risks losing market share to those who better understand and cater to customer needs.

If users stop using your product, your business model's revenue will also decline, and the only way to maintain profitability is to revise the model and potentially make core changes to the product.

Conclusion

In conclusion, developing a product against its business model can have disastrous consequences for a company and its customers. To achieve long-term success, businesses must ensure that their products align with their core value proposition, delivering a consistent and satisfying user experience that meets the needs of their target audience. By doing so, companies can maintain a competitive edge, foster customer loyalty, and support sustainable growth in today's rapidly evolving marketplace.

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