How a US-Based Hardware Startup Venturing into Software Mitigated its Product Analysis Challenges?

A hardware-producing startup after a year of selling its tangible products had ventured into software manufacturing. However, the gamble for profitability and growth was challenged by product quality, design, and inefficient user experience. The company authorities went on to seek the services of Research Nester analysts to strategically devise a solution for effective product analysis using their expertise and experience.

An overview:

A startup dealing in hardware went on to build resources and capacity to initiate software development. The transition although seemed smooth, hit turbulent waters owing to the incorporation of complex technologies.

The company continuously failed to identify the crucial aspects of the products that needed consistent evaluation. The company’s strategy was focused on delivering as per the supply and demand analysis. It unconsciously neglected the functionality, performance, security, usability, and mutual compatibility of its products.

With recurring failures in delivering functional and efficient user experience, it found itself at a loss of revenue and customer acquisition.

Finally, Research Nester was brought into the domain to facilitate a strategy for effective product analysis.

The Story

The startup was initiated as a hardware company in October 2017. At the beginning of 2019, it ventured into developing software for its hardware components. The company produced various hardware components such as graphics cards, network adapters, printers, scanners, and sound cards. It went on to introduce device drivers that could provide necessary instructions and protocols for the operating system to interact with the hardware devices effectively. The company sold its hardware through the traditional business model of letting buyers directly purchase it and then providing the value-added device driver, inducing the customers to buy it. However, with the onslaught of the Pandemic, the market trends changed drastically. The company did try to keep pace with the evolving market dynamics but the lack of domain-specific expertise resulted in the failure in identifying vulnerabilities and ineffective product analysis. Moreover, inadequate documentation for software and related hardware hindered the analysis process. To complicate matters further, there were compatibility and interoperability issues between the hardware and software. This resulted in a poor user experience. All this started to drain the profits, margins, and resources. Research Nester analysts stepped in at this crucial time when the company was incurring losses and was finding it difficult to keep afloat.

The Solution:

The major point of the company was faulty product analysis. Research Nester analysts suggested a change of strategy that instead of making the consumers pay for hardware and again for software, the latter could be offered as a subscription or better still Software-as-a-Service (SaaS). In fact, to boost further growth and profitability the hardware could also be promoted as Hardware-as-a service, where customers could pay a subscription that covered both the use of the product as well as associated services. Recurring revenue would be more valuable than one-time revenue as it would enhance customer loyalty. To emphasize it further RNPL consultants offered a customized solution related to the opportunities and future trends of GPU as a Service Market. However, Research Nester consultants also analyzed that for the above business model to work the products should earn the trust of the users. In other words, the customers shall only be willing to pay a subscription if they find the hardware and related software worth the price. The following strategies were suggested by RNPL analysts-

Firstly, to clearly define the objectives regarding the functionality and analysis of the product.
Secondly, to establish a dedicated and specialized team with adequate knowledge and skill sets for analyzing the product.
Thirdly clearly outlining the methodology of product analysis and consistently and carefully evaluating and improving it as per the product requirement.
Fourthly, establishing a well-structured and standardized analysis that covers all relevant aspects of hardware and software evaluation and their mutual compatibility.
Fifthly, documenting the analysis of all products for future reference and better decision-making based on the analysis outcomes.
Finally, evaluating the product from the user’s perspective, the experience and satisfaction a customer can achieve while using it.

The company incorporated the above strategies to finally achieve its targeted business objective.

Results

The company was seeing dwindling sales right from its very beginning, with sales figures being ~USD 1200 in 2019. Even the products sold were failing to meet user expectations. With COVID-19 barging in unexpectedly, the company authorities tried to re-strategize their production and marketing but all efforts fell flat. By the end of 2020, the cash registers of the company showed a bleak scenario with sales being a meager ~180 USD. The leadership of the company took the advice and suggestions offered by RNPL consultants to bring the business back on track. After re-planning and re-structuring its product analysis strategies, the sales improved initially little by little to reach ~USD 1500 in 2021 and gradually progressed significantly to reach ~USD 4500 in 2022. Research Nester consultants used their experience and expertise to facilitate the incorporation of the right product analysis methodologies for the company. This way the startup was able to build a prominent market position and create profitable prospects for future growth.

How a US-Based Hardware Startup Venturing into Software Mitigated its Product Analysis Challenges?

An overview:

The Story

The Solution:

Results

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