AMA: Matterport Sr. Director of Product Management, Abhijit Limaye on Hardware Product Management

3 Main considerations to start thinking about this - 1. Size of the pain point - What is the size of the problem the feature is solving and is that the most important problem to solve? 2. Return on that investment - Think about how you will measure that importance, and then maximize that metric. ROI can be revenue, competitive edge, user delight, customer satisfaction. Decide what works for your team / organization. 3. Time frames & Resources - Especially when it comes to hardware, you start dealing with longer time lines than what can be solved in 1 or 2 quarters. Finally, use opportunity cost to verify that you are working on the most important problem to solve first. When you choose to have the team work on something as top priority, your team is (by design) not working on something else.

Great question. The only certainty in forecasting is that it will be wrong. The question is to what degree? And how can you reduce the variance? Forecast is an estimate. There are 2 approaches to estimating the demand for your product. I recommend using both, and then to perform checks and balances, using the 2 methods. Top Down (Entrepreneurial method) - If you are a category-defining business, you are creating new markets. Evaluate what products are customers currently using and how does your product change that equation. Does it require a change in behavior? If so, it will take time to penetrate the market. (Think VR headsets for example). If you are a smaller company with large ambitions, it can be tempting to forecast higher to satisfy investor interests, but over-forecasting can be devastating to a small business. Scaling up is a problem that can be solved easier than scaling down. Bottom-up (For established business) - Here you have a lot of history to work with. Start the process early. Work with your Sales and Marketing teams to understand demand signals, by Product SKU, by Geo, by Channel. Understand the potential of promotions, pricing and marketing so that you can manage budgets accordingly. Finally, as a Product Leader, you are responsible for both the top and bottom line. So develop contextual understanding of sales figures. Ultimately, methodologies and tools will only help so much. You deep understanding of the market, demand drivers, extraneous factors affecting demand will ultimately help reduce the forecast variance.

The list is long I am afraid. Thankfully most of those were logistical challenges, and not related to user experience or customer satisfaction. Be sure to run your product through sufficient number of early adopters, Beta testers. Here are a few logistical challenges - * Forecasting - In one of my product launches, we ran out of our product in less than 1 week as we completely underestimated demand. It took us 3 months to ramp up to the actual demand. The lesson learnt - Think ahead and decide how you will address the forecast variance. * International launches - Managing simultaneous launches internationally will be difficult (mostly due to compliance requirements). Plan ahead and launch in phases. * Reliability - Be aware of the reliability of your product, and expected returns. Plan ahead on how you will respond to RMAs. * Yield - Your engineering and manufacturing team should be able to tell you in case of any yield issues. Do not launch your products if the manufacturing yield is not high enough (Low yield - means there are unresolved quality problems that may surface later or that you cannot meet customer demand).

Managing innovation can be highly contextual, depending on how much your organization can afford. This affordance can be either monetary or time to market. Large Vs Small companies - Large companies can afford to wait and perfect a product before they launch, or they can decide to launch an imperfect product because they know they will launch the next iteration in 1 year anyway. Smaller companies will have greater time-to-market (TTM) pressures and may struggle more. Let's assume that you cannot change the pace of innovation at your company. Step back and think about - What problem are you trying to solve? What is the minimum viable / lovable product? See if that helps to descope the nature of innovation needed. Example - Today, my fitness tracker can measure EKG but the very first versions simply showed me a step-count. Both were considered ground breaking innovations at the time they were launched. But contextualizing those with respect to customer problems, can help with the cost and time pressures.

Not sure if this question is in the context of iterations in terms of product launches or managing expectations internally with your exec.s / C-suite. Framework for customers- * Make sure that the product iterations are clearly differentiated and provide a clear benefit to the customer. HW purchases are usually typically larger $ amounts (than your monthly SaaS subscriptions for e.g.) and have a longer life with a customer. * Be clear about the benefits from incremental changes versus a fundamental shift. Does the iteration require any change in customer behavior? * Explain backward compatibility (if there is one) * Have a clear GTM, even for small, delta launches. Internal alignment and managing expectations with Exec.s Change management is common, both in HW and SW. The big challenge in the HW world, is that 'change' takes a long time. 'Sprints' can be cycles that take months instead of 2 weeks. The key to managing this successfully, is to plan ahead and build credibility with your C-suite. If you believe you will need 2 proto builds, execute for 2 builds but plan for 3. If your Say-Do ratio is high, you will have an easier time navigating the questions from C-suite. Managing downwards is also important - Make sure that the team knows what Plan B is if Plan A fails. Communicate to the broader teams as often as you can.

Here are a few - * Longer timeframes - The further the launch window, the harder it is to hit the bull's eye. You are predicting what the market will need 1 or 2 years from now. And you will need to make the investments now to succeed much later. * End of Life. Managing EOL inventory will be difficult than phasing out support for a SW feature. * Incremental costs - for selling SW products are practically $0, but hardware products will cost you money every time. * Higher bar for managing your inventory * Development - Minimum lovable or even viable products are harder and more expensive to make. That said, the hardware landscape is changing dramatically. Focus on proving the product to market fit as early as you can. Take advantage of the fast prototyping options, more efficient design options, reference design kits / HDKs to prove the product - market fit and the use case. The costliest mistakes in HW are usually not due to delays in product development, but rather poor understanding of the market requirements. So as a Product leader, focus on making sure that you are launching the right product.

Hardware products are increasingly becoming integrated products, i.e. HW is either a part of a service or sold with a piece of software. The more you treat HW/SW as separate entities, the harder it will become to present a holistic, comprehensive vision for the 'product'. Embrace the changes. Understand the ecosystem, and how hardware is going to become an enabler for selling those integrated services or software. Exploit the cool features of the hardware for the benefit of the 'product'. Embrace AI, and embrace it for the right reasons. It is not just for SW development. You can integrate AI tools quite effectively to cut short the development time and reduce costs.

First and foremost, HW & SW product management ultimately run on the same concepts - Customer needs and wants. You are still thinking about launching the right product for the market. You are still identifying pain points of a customer, and delivering what the market needs. So you already have a great deal of familiarity. Now, familiarize yourself with the HW product development life cycle. Know that the time between making one prototype and making 100,000 can be more than a year, even if it seems simple. Get familiar with the deltas between HW & SW, such as * Supply chain management (it can make or break your launch) * Compliance certifications like FCC, UL, CE can be time consuming * Product integrity testing can divulge new facts about your product - e.g. you may realize that your product behaves differently under extreme heat and humidity for extended periods and hence cannot be sold in say Singapore. Prepare to be "student-always" and you will excel.

2 main frameworks to think about here. 1. Can you identify a white space in the market? (Blue Ocean Strategy). What is the market missing? And do you have the big unlock that the market is waiting for? * Don't get too attached to your ideas and feel free to ditch those that provide only an incremental improvement to the customer experience; 2. What is your special niche. Is it technology? Is it distribution? Is it the software that you pair it with? Focus on the small section of the market. Knowing that you don't have to conquer the full market on Day 1 can be important realization. A product that is made for everyone is made for no one. For example -In a flooded market of portable audio speakers, in the very early days, Sonos found its niche. It was focused on whole-home-audio and made exceptional speakers for music aficionados.

Teams working in silos can be one the main challenges in HW projects. This can be Engineering vs manufacturing or supply chain or logistics or marketing. The success depends on teams that are 100% aligned with the goals of the business. Be sure to keep clear lines of communications. Engage functional leaders to make sure that they are all aligned with the business objectives, timelines. It takes a village to build a HW product and launch it. No job is small and everyone makes a difference. Make sure that everyone knows this.

Avoid cost-based pricing as it can be one of the biggest pitfalls related to HW pricing. * HW costs can and will change based on the number of units you produce. So if you can afford to, take a longer term view of the business. * Price the product based on the willingness to pay (to match the value generated by your product for the customer). Think about the pricing roadmap over the life of the product (not just the Price-at-launch). * Does the launch price give me optionality to offer promotions? * Do I want to do a launch promotional pricing to generate interest? This has to be time-bound. * What is the competition price point? and how much is my product differentiated compared to the competition? * Value-based pricing for HW products works much better than pricing strategies designed to penetrate the full market on Day 1.

Before jumping to any traditional metrics, be sure that you understand the Business Objective. For example, your organization may use the hardware to create interest, generate consumer loyalty and may be a loss-leader. And in other cases, hardware product may be your whole business and you want to protect your margins. So the first goal is to make sure that your post-launch metrics are in-line with the company goals. Few traditional metrics - Sales, number of units sold, increase or decrease in the rate of sales, profitability can be some standard metrics. RMAs (rate of return), customer complaints, on time delivery can also be important metrics especially in the early days of launch. Engagement Metrics However, make sure that you have engagement metrics to understand how well users are connecting with the hardware. Metrics such as First Radio On (FRO), customer satisfaction ratings (send a survey if need be), Amazon ratings (for consumer products) will be important to track over time..

* Focus on understanding the customer, more than the technology. * Increase your customer engagement, and spend more time in understanding how the product will be used than how the product will be sourced / produced. * Focus on customer benefits and not product features or the amazing technology. Hardest barrier in this journey will be about shifting your thought process from thinking about how to produce, when to produce, how many to produce TO Why to produce.