balled up paper in the waste basket
PHOTO: Steve Johnson

Will Smith made a viral splash earlier this year when he shared his perspective on failure in an Instagram story. “Failure is a massive part of being able to be successful,” he said, and urged people to “fail early, fail often, fail forward.”

The idea that acknowledging failure plays an important role in nurturing growth is having something of an “it moment” right now, but it is not necessarily a new concept. In the 1760s, in a series of fictional letters compiled in a book titled “The Citizen of the World,” Enlightenment-era author Oliver Goldsmith wrote, “Our greatest glory is not in never failing, but in rising every time we fail.”

Lessons in Failure for Product Teams

It’s safe to say that 21st century celebrity culture and 18th century literature are unorthodox sources of product management strategy. But a willingness to embrace failure is an idea that has become core to how lean startups approach product development. “Failing forward” is a more nuanced version of Facebook’s infamous “move fast and break things” slogan.

To be sure, no team hopes that the business or feature they’re building will fail, but it is a hard reality that failure will likely happen at some point in every product’s life cycle. And, frankly, it inevitably will happen at least once in everyone’s career. For every software-as-a-service success story like Intercom, Workday or Pinterest, there are hordes of outright failures, and challenging retention rates even among survivors. Consider the following statistics:

  • In 2014, IDC reported that 30 percent of mobile enterprise applications launched within the previous 12 to 18 months had been defined as “failures,” according to a Propelics webinar.
  • Most apps see an 80 percent decline in downloads after their first week, according to Reinvently.
  • The average Google Play app loses 77 percent of its daily active users (DAU) within the first three days, 90 percent within 30 days, and 95 percent within 90 days, according to a newsletter post by Andreesen Horowitz analyst Andrew Chen (subscription required).

What’s the biggest cause of product or feature failures? A look at why startups tank gives us a clue: CB Insights analyzed 101 startup failure post-mortems and found that, while startups that crash and burn often cite a number of reasons for their demise, the No. 1 reason — cited by 42 percent of startups that failed — was “no market need.” The No. 2 reason — the relatively straightforward “ran out of cash” — was cited as a factor in just 29 percent of the post-mortems.

The idea that there is “no market need” for many products is sobering. Why do companies shovel investor money into sinkholes? Whether we call it blind arrogance or heedless optimism, it boils down to lack of understanding of customer needs — and to companies not being honest with themselves about their value propositions.

Sometimes, when failure looms, management cuts and runs. Or they throw even more resources at the problem — the sunk cost fallacy. When it comes to apps, there’s another impulse at work, too: Most software teams are problem-solvers at heart, and developers are convinced of their ability to fix anything, even projects that are clearly doomed.

Related Article: A New Formula for an Innovative Culture

‘The Next Feature Fallacy’

As Chen pithily observed in a 2015 newsletter post (subscription required): “For people who love to build product, when something’s not working, it’s tempting to simply build more product.”

Chen’s post was titled “The Next Feature Fallacy” — a term coined by Joshua Porter, a leading user experience (UX) designer and a shrewd observer of the industry, who defined the Next Feature Fallacy as the mistaken belief that “the next feature you add will suddenly make people want to use the entire product.”

joshua porter twitter
(Source: Twitter)

The hope is that a new feature will cause a positive bend in what Chen calls “the most tragic curve in tech” — a precipitous drop-off in user engagement.

andrew chen graph

(Source: AndrewChen.co)

But as Chen points out, the overwhelming majority of new features won’t have any appreciable impact on this pattern, and many product teams have a tendency to make key mistakes that contribute to the problem. First, they target engaged and retained users rather than non-users and new users. And when they do engage, there’s less-than-optimal impact because the new features are presented as options, not as part of the core onboarding process for all users.

What causes these lapses? In Chen’s opinion, designers are obeying “the well-intentioned instinct to focus on specialized needs that drive deep engagement,” rather than deploy features that maximize broad uptake from the greatest number of users.

His key advice for delivering features that will get real traction and actually “bend the curve?” Simple: The most successful features tend to focus on appealing to casual and non-users. That necessarily requires a strong understanding of the user life cycle.

It always comes back to that, and you ignore it at your peril. Even the biggest and most successful companies can forget it and pay the price. Google Wave was an ambitious attempt to unify multiple forms of communication into one central place, but when a product team’s elegant and ingenious paradigm is at odds with how users picture convenience and usability, guess who loses?

So it seems Google learned from that experience when it went small, simple and friendly for the video chat product Google Duo. It offered a solid product and iterative improvements, not reach-for-the rafters proclamations about how it would transfigure, well, everything. (By the way, ever wonder if Sergey Brin keeps a few old pairs of Google Glass smart glasses lying around?)

Related Article: Drive Growth With Compelling Product Feature Announcements

Failure Is Not an Option — It’s a Necessity

Social media feeds our fascination with other peoples’ failures, and over the years the tech sector has been a favorite source of spectacular flameouts — many of them attributable to the manic pursuit of bad ideas, for sure.

Yet outside observers often can’t seem to wrap their heads around the notion that failure is a necessity in the tech universe. The iterative process of design thinking that polishes a product to a user-friendly sheen is built to grapple with failure, to befriend it, to learn from it.

Elon Musk and SpaceX have blown up a lot of rocket boosters over the years. They have even visibly celebrated their failures because they know failures teach useful lessons and generate vital data. Iterating rocket development enabled SpaceX to pull off the unprecedented trick of teaching a booster how to land itself for recycling. That success was built on a lot of highly visible and extremely noisy failures.

Another obsessive inventor, Thomas Edison, famously said, “I have not failed. I’ve just found 10,000 ways that won’t work.” It is unlikely that many business managers have quite that much patience, but the lesson holds: The failure of a feature or even an entire product doesn’t have to be a failure of learning; it’s what you do next, based on earned experience, that really matters in the long run.

Related Article: DevOps How To: Learning From Failure

Know Your ‘MVP’

Understanding your minimum viable product (MVP) and its value to users is how you decide which features are necessary, and which ones aren’t. Airbnb is a classic example. Its MVP didn’t include a robust website or multiple selection options for locations, data and pricing. The company’s initial audience? Tech conference attendees at a single sold-out event.

By finding enough paying users — three — to prove the viability of its product, Airbnb kept things simple and lean, and continually improved its offerings as it made its way forward.

air bed and breakfast

Even then, the platform wasn’t performing as hoped, and co-founder Joe Gebbia has said there was one reason for that: “For the first year of the business, we sat behind our computer screens trying to code our way through problems.” One insight was to replace the crappy pictures on Airbnb listings with high-quality shots company employees took themselves after flying to New York. The result? Weekly revenues doubled.

That’s why the Airbnb team maintains a cultural commitment to meeting actual users and understanding their real needs and triggers, and to deliberately taking risks just to see what they can learn from the outcome, good or bad.

Related Article: CMO Advice: You Have to Take Calculated Risks

Flopping Forward

If you maintain that analytical outlook and always sift for a few little gems in the mudslide of failure, you might just flop your way forward. Slack is the very embodiment of the notion of learning from failure.

When it was still known as Tiny Speck, the company that is now Slack built a massive game called Glitch. The game was not a success, commercially or technically, but the developers felt they had learned something valuable from building an in-game collaboration tool. It had allowed players to actually have fun doing repetitive in-game grinds, making boring activities enjoyable.

slack logo

The team members then focused on what they had learned about collaboration tools, brought those skills (along with an off-center, gamified approach) to a business app, and gave birth to a huge success. But that success was only possible because of the team’s willingness to walk away from a beloved project while recognizing that there was still value in the work they’d done.

(By the way, Slack still contains a tiny speck of Glitch.)

Loving Little Failures

Let’s circle back to the singular Elon Musk — this time at Tesla. Ravi Vadrevu, the CEO and founder of Kriya, points out in a blog post that Tesla is a great example of how you can succeed by not getting too far out over your skis — by staying within your game and working your way up to solving a “Grand Challenge” by first pushing out a minimum viable product and then iteratively improving upon it.

In Tesla’s case, Musk launched an electric car. He then iterated his way through improvements in battery life, performance, telemetry and onboard computing, and production and logistics, until he had a really nice car to sell.

What else did he manage to iteratively accumulate along the way? An international network of retail outlets and charging systems, more car models, electric buses and trucks, a battery manufacturing center called the Gigafactory, in-home storage technology, a solar cell business — in other words, an entire end-to-end ecosystem for solving his Grand Challenge, which is to develop and environmentally friendly way to power an entire planet (and maybe the planet next door, too).

As Vadrevu notes, Musk could have started by tackling the Grand Challenge straight off, possibly by building the Gigafactory or taking some other prodigious leap. But then Tesla wouldn’t have iterated its way through small failures and small successes to deliver an MVP, and it wouldn’t have learned so much about its audience and market — all of which paved the way for all the rest.

When one of your features or apps fails in the marketplace, how your enterprise culture reacts to it might be the best test of your mettle. If you’re not embracing your faults and failures, squaring up and claiming them the same way you would a victory, then you’re depriving yourself of one of your most powerful tools for getting it right the next time.