7 Reasons Products Fail

Welcome and Introductions

Jake Yingling | 00:00:00–00:02:41
Good afternoon, everyone, and welcome to today’s webinar titled Seven Reasons Products Fail. I’ll be your MC today. My name is Jake Yingling , and I lead our Client Services team here at Productside. Before joining Productside, I spent about 15 years as a PM and leader of product teams, mostly in financial services, but also with some time in consumer goods, e-commerce, and interactive agency domains.

I’m joined today by Kenny Kranseler, a Principal Consultant and Trainer here at Productside. Kenny is what I like to call an OG product person. He’s built and managed products at Microsoft, Amazon, and a handful of startup organizations. Kenny holds a BS from the Wharton School at UPenn and an MBA from Northwestern’s Kellogg Graduate School. He began his career as a consultant at Bain and Company, so for all the consultants joining today — let this be a reminder that there is always hope to join the product management community. Frankly, he’s one of the best, and we’re lucky to have him here. I know everyone will walk away with some fantastic insights today.

Kenny Kranseler | 00:02:41–00:03:18
Thanks, Jake. I’m not worthy. Thank you for the kind intro. And welcome, everyone. Excited to talk through some of the biggest and most common reasons products fail — and, more importantly, what you can do to avoid those pitfalls.

Community and Webinar Logistics

Jake Yingling | 00:03:18–00:05:26
Before we begin, we’d love to encourage everyone to stay engaged with the broader product community. Being part of an online group — especially these days — helps you stay connected, keep learning, and continue honing your craft. Join our LinkedIn Product Leadership Group. It’s a great forum to chat about best practices, tips, and otherwise just stay connected with your peers.

During the webinar, we strongly encourage questions. This isn’t meant to be a one-way lecture. The more interactive we can make this, the better the experience will be. Use the Q&A box at the bottom of your screen to type in questions at any time. We’ll reserve some time at the end for general Q&A.

The most popular question we always get: “Can I watch this later?”
Yes — all attendees will receive a link to the recording afterward.

And last quick administrative note before we dive in: a brief intro to Productside and our mission.

About Productside

Jake Yingling | 00:05:26–00:07:55
We’ve been around more than 20 years now and are based in Silicon Valley. Our name comes from Highway 280 that connects San Francisco to San Jose. Our mission is to empower product professionals with the knowledge and tools to build products that matter.

What makes us different from other companies is that we’re entirely focused on the needs of product professionals. Whether you’re an individual working to grow your career, or a leader focused on improving team effectiveness, we have the experience and tools to help. And we go far beyond training — our team is made up entirely of real product managers with real-world experience across companies like Apple, Adobe, Microsoft, and Amazon.

With that, I’ll hand things over to today’s expert to dive into the seven reasons products fail.

Kenny Kranseler | 00:07:55–00:08:10
Thanks, Jake. Let’s jump into failure — why it happens, what to learn from it, and how to avoid it.

Why So Many Products Fail

Kenny Kranseler | 00:08:10–00:11:32
Today we’re going to talk about failure — not to discourage anyone, but to understand what leads to product failure, what patterns we continue to see across industries, and what you can do as a product leader to avoid the most common pitfalls. I want you to embrace something fundamental: failure is part of the product discovery process. We all experience failure in life — when we learn to move, when we learn to eat, when we learn to try anything. The key is to limit your exposure and maximize your learning.

The same principle applies in product management. When we fail, we want those failures to be inexpensive, early, and educational. We want them to inform the next experiment and improve the next release. We don’t want catastrophic failures that sink the product or confuse the entire business. So today we’ll break down the seven most recurring reasons products fail and talk through what you can do to reduce risk at every stage.

But before we go deeper, let’s look at the scale of the problem. What percentage of new products do you believe fail? By fail, I mean they don’t meet expectations — for the company or the customers who were intended to use them. Is it less than 25%? Between 25–65%? Between 65–95%? Or more than 95%? Most studies suggest the answer falls between 65% and 90%. That’s a staggering amount of wasted time, money, and effort across industries.

Poll #1 – How Often Do Products Fail?

Kenny Kranseler | 00:11:32–00:12:40
Let’s launch our first poll. As we wait for results, consider why the failure rate is so high. Is it poor market understanding? Weak value propositions? Bad execution? Misalignment with company goals? Lack of readiness? There’s no single cause — that’s what makes this topic so important.

Jake Yingling | 00:12:40–00:13:07
Looks like responses are in. And yes — most of you selected either 25–65% or 65–90%, which aligns with the research. It’s sobering, but it also gives us clarity: if we can avoid even a few of the major pitfalls, we dramatically increase our odds of success.

Defining Product Failure and Success

Kenny Kranseler | 00:13:07–00:16:02
To solve the problem of product failure, we need to understand what failure actually means. Not all failures are spectacular or catastrophic. Some failures are subtle — products that don’t hit revenue targets, don’t retain users, don’t satisfy the business case, or simply don’t create the intended impact. These are soft failures, and they can be just as damaging over time.

One major reason products fail is that management does not define success up front. If you don’t define success, you won’t know when you’re off track, and you also won’t know when something is failing early enough to course-correct. Success involves multiple dimensions: financial goals, user adoption, competitive benchmarks, development goals, cost reduction, customer satisfaction, and more.

If you don’t establish strategic objectives and key results at the beginning — and if you don’t tie the product’s success criteria to measurable outcomes — the product is more likely to drift and ultimately disappoint. This is the first step in avoiding failure: define what success looks like before you build anything.

Reason #1: Lack of Customer Insight

Kenny Kranseler | 00:16:02–00:19:45
The first major cause of product failure is a lack of customer insight. This is when we think we understand the customer, but we actually lack depth, context, or clarity on what they’re trying to accomplish. Product management is inbound marketing — understanding customer needs, motivations, obstacles, and jobs to be done.

Customers may express desires, but they rarely articulate root causes. They may request features that don’t solve the underlying problem. Your job is to uncover the problem behind the request. If you build a product based on surface-level feedback, you may deliver something nobody actually needs.

A classic example: Google Glass. Interesting technology, innovative idea — but unclear customer value. We didn’t really know the job it was supposed to perform for customers. It didn’t solve a burning need. It was a solution searching for a problem.

To avoid this pitfall, product teams must observe, interview, and empathize. Use active listening. Avoid selling during discovery conversations. And remember: customers don’t hire your product because of what it is — they hire it because of what it does.

Reason #2: Targeting the Wrong Market

Kenny Kranseler | 00:19:45–00:23:12
The second reason products fail is targeting the wrong market. You can’t serve everyone, and you shouldn’t try. You must identify a segment of the market that has a meaningful need and a willingness to pay.

Segmentation matters — by industry, by region, by behavior, by pain point. Once you know the segment, you must understand the buyer, the user, and the influencer. If you aim at the wrong audience, even the best product will fail.

One example: Coca-Cola’s “C2” product. It was designed for 20–40-year-old men who liked Coke but wanted lower calories. It launched with a $50 million marketing budget and flopped completely. Coke misread the market, priced it too high, and mistimed the low-carb trend. It wasn’t clear what the product was supposed to be, and the customers didn’t want it.

Targeting the wrong market is one of the fastest ways a product can fail.

Reason #3: Weak or Unclear Value Proposition

Kenny Kranseler | 00:23:12–00:27:14
The third major reason products fail is having a weak or unclear value proposition. In other words, the product is either too expensive for the value it delivers, or it delivers too little value for the price being asked. Customers ultimately make decisions with their wallets. If they don’t understand the benefit, or if the benefit doesn’t outweigh the cost — whether that cost is time, complexity, price, or friction — they simply won’t adopt.

Value is not just about the sticker price. It’s the entire equation:
Value = (Benefits + Differentiation + Experience) ÷ Cost.

Cost includes more than money. It includes risk, effort, onboarding time, switching cost, training cost, and emotional cost. You must understand both objective value — measurable improvements — and subjective value — design appeal, brand trust, ease of use, and perceived quality. A product can be priced competitively but still fail if customers don’t believe it provides meaningful value.

If competitors offer 80% of your solution at 20% of your price, adoption will stall. If the customer segment you’re serving is budget-constrained, your product may never gain traction regardless of its capabilities. And if your product is missing a critical feature that your customers expect, that negative value must also be factored into your proposition.

Great pricing and great value propositions require discipline, clarity, and understanding. Know what you’re willing to invest in, and be equally clear about what you are not willing to invest in.

Jake’s Story — When All Three Failure Types Collide

Jake Yingling | 00:27:14–00:30:26
I’ve got a personal story that actually hits all three failure categories at once — lack of customer insight, wrong market, and weak value proposition. Years ago, I worked at a financial services company where we had a highly successful consumer-facing product that provided credit score insights. It was useful, it solved a real customer problem, and it quietly became a massive acquisition channel.

Leadership decided they wanted the same magic for business customers. The directive was: “Build the business version of this credit product.” But there was no research. No validation. No customer discovery. It was literally, “Go build this, because it worked in B2C.”

We built it. And it flopped.

Small businesses didn’t understand what value they were receiving in exchange for the information we were asking them to submit. Many didn’t even know business credit scores existed. The problem we thought we were solving wasn’t a problem they were experiencing. There was no urgency. No demand. No value exchange. It was a product pushed into a market that neither needed nor asked for it.

It was a classic example of how building something because leadership demands it — without understanding the customer, the market, or the value — leads directly to failure.

Reason #4: Weak Business Model or No Path to Company Value

Kenny Kranseler | 00:30:26–00:34:52
The fourth reason products fail is when the business model doesn’t work — either for the customer or for the company. You can build a product that customers love, but if it doesn’t make business sense, the organization will eventually cut it. When the business model is flawed, the product slowly gets starved of resources and inevitably fails.

If you’re building physical products, you must understand cost of goods sold — manufacturing, distribution, parts, supply chain. If your cost of goods sold isn’t safely below your price, the business can’t sustain it.

For digital products, you must understand non-recurring development costs — engineering, design, infrastructure, compliance — and how they scale. If your break-even point is too high, or if your cost to market, sell, and support outweighs the lifetime value of a customer, the product becomes a drag on profitability.

Amazon provides a clear example. I once led a product for university students that they absolutely loved — a scheduling tool that helped them better manage their academic lives. But after evaluating the business model, we realized it didn’t help Amazon sell more digital textbooks, which was our actual revenue stream. Even though the customer loved the product, it didn’t make sense for Amazon. It didn’t contribute to core business value, so we killed it — and that was the right choice.

A product must create value for both the customer and the company. When either side is missing, long-term success is impossible.

Reason #5: Poor Execution and Failure to Deliver the Right Product

Kenny Kranseler | 00:34:52–00:38:18
The fifth major reason for product failure is poor execution. You can identify the right customer, the right market, and the right value — and still fail if the delivery does not meet expectations. A product can begin strong with early adopters but stall with pragmatists — the majority of the market that demands stability, clarity, usability, and reliability.

This is where the “Crossing the Chasm” model comes into play. Early adopters will tolerate incomplete products. Pragmatists will not. If you optimize too heavily for early adopters, you risk building the wrong product for the large majority of your potential customers.

Reid Hoffman, founder of PayPal and LinkedIn, once said something provocative: “Don’t listen to your customers.” What he meant was: don’t over-optimize for early adopters. They will give you feedback that reflects their niche preferences, not the needs of the mainstream audience.

This leads into a common trap: misunderstandings around MVP. Some companies build an MVP that is too minimal — so minimal that customers cannot understand the value. Others build something too large and too late, missing the market window entirely. And some never iterate beyond the MVP, leaving the product forever stuck in a half-finished state.

A great MVP is minimal and viable. It must deliver real value to someone — not everyone — but someone who is willing to adopt and learn. And it must be followed by continuous iteration toward the broader product vision.

Reason #6: Bad Timing — Too Early, Too Late, or Poorly Positioned

Kenny Kranseler | 00:38:18–00:42:44
The sixth major reason products fail is timing. Timing can make or break a product, especially in markets driven by seasonality, regulation, technical readiness, or competitive momentum. If you arrive too early, the supporting ecosystem may not exist. If you arrive too late, your competitive advantage may disappear.

Seasonal products illustrate this clearly. If you’re building tax preparation software and you miss the seasonal window, you’ve essentially lost an entire year. Timing determines whether you’re relevant.

This isn’t just about being first to market. Being first can be an advantage, but only if the infrastructure, demand, and customer readiness are in place. The Apple Newton is a perfect example. It was innovative, ambitious, and ahead of its time — but too far ahead. The supporting technology, such as reliable handwriting recognition and fast mobile data, simply didn’t exist. The idea was solid; the timing was off.

On the opposite end, companies that enter late must differentiate sharply. They need stronger value propositions, clearer benefits, and better execution. They must avoid the trap of releasing “just another option” into a saturated market. If their timing is late and their differentiation is weak, the product stalls on impact.

Great product management includes understanding timing signals — customer demand, competitive landscape, technology maturity, and friction points. When those signals align, you can enter with strength. When they don’t, even great ideas falter.

When Rushing to Market Backfires

Kenny Kranseler | 00:42:44–00:45:58
Rushing a product to market before it’s ready is one of the fastest paths to failure. Companies often feel pressure — competitive pressure, internal pressure, executive pressure — to release early. But if the product doesn’t work reliably, doesn’t deliver on the value proposition, or creates negative first impressions, the damage is often irreversible.

This is where robust beta programs become critical. A beta period is not a formality. It’s a high-value learning environment where you discover whether real customers can actually use the product, get value from it, and achieve meaningful outcomes. It’s also where you stress-test the value proposition, the messaging, and the operational readiness: sales scripts, onboarding paths, support documentation, and internal alignment.

The beta isn’t just about identifying bugs. It’s about identifying patterns. Where customers hesitate. Where onboarding breaks. Where expectations are unclear. Where confusion overwhelms the value.

If the beta fails, the answer is not “We’ll fix it later.” The answer is: “Stop. Fix it now. Then launch.”

Skipping or minimizing beta testing leads to poor launches, customer distrust, and years of recovery. Product success is fragile. A damaged launch can be extremely difficult to reverse.

Reason #7: Weak Go-to-Market Strategy & Poor Product Marketing

Kenny Kranseler | 00:45:58–00:50:11
The seventh and final major reason products fail is a weak go-to-market strategy. You can build a fantastic product with great value, strong execution, and perfect timing — but if customers don’t understand what it is, why it matters, or how it helps them, the product will fail.

A strong go-to-market strategy requires clarity across messaging, positioning, target personas, onboarding, pricing, and the buyer journey. You must communicate the product’s benefits in a way that resonates with the customer’s worldview. If marketing materials, messaging, and positioning fail to land, adoption slows.

Product managers cannot outsource this entirely to marketing. Even if your company has a dedicated product marketing function, you must be deeply engaged. Product management is responsible for both inbound and outbound inputs — understanding the customer and ensuring the market understands the product.

Marketing needs clear, compelling value stories. They need audience insights. They need differentiators and proof points. Without your partnership, marketing is guessing — and guesses rarely produce adoption.

Outbound marketing must guide buyers through the full journey:
Awareness → Interest → Evaluation → Trial → Adoption → Referral

When messaging, targeting, or segmentation misfires, the product fails quietly and slowly — not because it’s bad, but because the world didn’t understand it.

Product-Led Growth and Onboarding as Marketing

Kenny Kranseler | 00:50:11–00:53:40
In the digital world, your product is increasingly part of your marketing engine. A well-designed onboarding experience becomes a conversion funnel. A clear “aha moment” becomes an acquisition lever. Strong usability becomes a retention strategy. And habitual engagement becomes viral reach.

This is product-led growth in action: using the product itself to drive acquisition, activation, adoption, retention, and expansion.

Zoom is an excellent example. By the very act of hosting this webinar, they are marketing the product to every participant. You are experiencing the value firsthand. The product is doing the selling for them.

Effective product-led growth requires deliberate design:
• Clear onboarding steps
• Fast time-to-value
• A visible path to deeper engagement
• Opportunities for sharing and collaboration
• Embedded upsell and cross-sell pathways

Products that fail to build these elements into their design rely too heavily on external marketing. Products that integrate these elements turn every user into a potential promoter.

Working Backwards: Starting With the Desired Customer Experience

Kenny Kranseler | 00:53:40–00:58:22
As we shift toward wrapping up, I want to introduce one of the most powerful concepts I learned at Amazon: the idea of working backwards. It’s a deceptively simple but transformational approach. Rather than beginning with features or technology or timelines, you begin with the experience you want the customer to have. You literally start with the end state.

What does delight look like for the customer? What is the ideal moment you want them to reach? What outcome signals that the product worked exactly as intended? Once you define that end experience, only then do you begin working backwards into all the requirements, systems, messaging, support materials, and features needed to make that experience possible.

Every part of the organization becomes aligned around enabling that finished experience — engineering, UX, marketing, sales, support, operations. The “end-state north star” becomes the decision filter for everything. If a feature doesn’t help create that experience, it’s removed. If an operational process gets in the way of achieving it, you redesign it.

This method is especially powerful because it prevents you from building for yourself or for internal politics. It forces you to build for the customer. And more importantly, it forces clarity. You cannot hide behind vague goals when you must define what success looks like and feels like from the customer’s point of view.

Working backwards turns product management from output-driven to outcome-driven. It reduces ambiguity. It aligns teams. And it dramatically reduces the risk of creating products that fail because they never should have existed in the first place.

Using a Data Dashboard to Drive Alignment

Kenny Kranseler | 00:58:22–01:02:51
If your organization isn’t yet data-driven, one of the most effective ways to change the culture is to visualize what the end state looks like. This is where the “data dashboard” exercise becomes extremely useful.

Print out examples of world-class dashboards — dashboards that show customer engagement, monetization funnels, activation metrics, retention patterns, error rates, adoption curves. Share them with your engineering managers, UX team, data experts, and digital teams. Ask a simple question:

“What would our dashboard look like six months from now if we were world-class?”

That question sparks creativity. It sparks healthy debate. It reveals assumptions. And it shifts the conversation from abstract aspirations to concrete metrics that matter.

Once you design what the dashboard should look like, the team naturally rallies around figuring out how to collect the right data, where instrumentation is missing, and how to measure meaningful behaviors instead of vanity metrics. It creates ownership across the organization and reduces resistance.

A dashboard is not just a reporting tool — it’s a cultural lever. It becomes a north star for product strategy, marketing alignment, engineering priorities, customer insight, and executive decisions. When used correctly, it becomes the heartbeat of the product.

Case Study: CNN+ and the High Cost of Misjudgment

Kenny Kranseler | 01:02:51–01:08:03
To bring everything together, let’s look at one of the most visible product failures in recent years: CNN+. This was a massively promoted subscription streaming service that launched on March 29th — and was shut down just over two weeks later. It is one of the most spectacular collapses the media industry has seen in years.

Why did it fail? Almost every principle we’ve discussed today was violated.

They launched without a clear customer need. There was already too much news content available for free, and they didn’t offer CNN’s actual live content as part of the subscription. The value proposition was confusing and weak. Pricing did not match perceived benefit. There was no obvious target segment willing to pay for a standalone news service. It was launched too late into an already saturated streaming market, and yet too early in terms of having a differentiated experience.

Even worse, the internal business case was misaligned with the broader corporate strategy. The merger between Warner Bros. and Discovery created competing priorities — and CNN+ didn’t add strategic value. The product was expensive, misunderstood, and misaligned.

The result? A $300 million failure within two weeks.

CNN+ is a reminder that product failure isn’t random. It’s predictable. And avoidable. When companies fail to understand the customer, fail to validate value, fail to time the market, fail to execute properly, and fail to align to corporate strategy — the outcome is inevitable.

Final Thoughts: Reducing the Risk of Failure

Kenny Kranseler | 01:08:03–01:12:27
The goal of today’s session isn’t to make product managers fearful — it’s to make you more prepared. Product failure is a fact of life, but it is also an incredible teacher. Our responsibility is to minimize the cost of those failures and maximize the learning we extract from them.

Every idea is a hypothesis. Every release is a learning event. Every iteration is an opportunity to improve the value, clarity, and alignment of your product. If you build mechanisms for learning early, you reduce the risk of catastrophic failure later.

Plan intentionally. Measure obsessively. Stay honest about what the customer actually needs. And focus relentlessly on outcomes rather than outputs. If you do these things, you dramatically increase your likelihood of building products that matter.

Thank you for spending this time with us today.

Closing Remarks & Q&A

Jake Yingling | 01:12:27–01:13:44
Thanks so much, Kenny. Failure is a tough topic, but you kept it engaging and real. Our hope is that each of you can take at least one or two actionable insights back into your work — something you can apply immediately to reduce the risk of wasted effort, wasted resources, and wasted potential.

If you want to go deeper into the full product lifecycle, or if you’re looking to build the essential skills required to build products that matter, visit Productside.com and check out our courses and tools.

We appreciate you joining us, and we hope to see you at a future webinar.

Kenny Kranseler | 01:13:44–01:14:22
Thank you all. Keep learning, keep experimenting, and keep working backwards from the customer experience. Take care, everyone.