Saturday, November 17, 2007

Marketshare and Product Innovation

One of my biggest challenge as a Product Manager is to prioritize the features, enhancements and bugs to be fixed in our product. Around the same time last year, my goal was to get a polished and well-designed product to market. During various releases, there were times when I felt we could have done better - fixed more bugs, enhanced the usability of the product, introduced new features, etc. Oftentimes, Sales and Marketing dictate time to market and Product Managers have to make the best use of limited time and resources. Looking back, I feel that we did a good job because we have been able to sell and deploy at a very rapid pace in the last 12 months.

Having been involved in various decisions that brought us here, I feel very proud when I hear stories from the field about how quickly our customers learned to use the product and how valuable it is for them. I also know that the base product, without any further modifications, will continue to sell because of the value it delivers. However, as a startup with deep roots in technology (our CEO has a PhD in Computer Science), we continue to invest significantly in product innovation and also make enhancements requested by our customers.

Interestingly, our biggest competitor, Tripwire, has adopted a completely different approach. I have seen various demos of their product, but have always come back with the impression that Tripwire's strategy is more focused on product positioning than real product innovation. Any IT admin who has used their product will tell you that their latest product is not significantly different from what they were selling 2-3 years ago. What has changed is their Marketing message - In Nov 2004, they pitched Availability, Nov 2005 was all about Change Auditing, they followed us in talking about Change Control in Nov 2006 and their current theme is around Continuous Compliance. I am sure they are doing extremely well, selling more and more licenses every year with minor tweaks to their branding. Guess we just have very different operating philosophies.

There is one other product that I have used for the last 5 years which has hardly changed - Microsoft's Outlook. Outlook is a great product for collaboration, but has some significant limitations - primarily around search. Ever tried searching your 2GB Outlook mailbox for an email and compared its speed to a similar operation in the free Gmail? Have you ever lost messages when your Exchange server's files got corrupted because no one likes to delete their older messages? Its not as if Microsoft does not know about these issues, but they probably don't see any value in fixing these problems. Now, Microsoft is hardly a company that you can accuse of sloth, but I'd hate to be the Product Manager for Outlook now. Microsoft seemingly prefers to encourage the development of a productivity eco-system around Outlook than incorporating basic features in their own product :(

I have tried some of the productivity tools over these years. Lookout, the one that Microsoft bought, had its power in its simplicity. They used Lucene to index the mails. Keyword search was very fast, but advanced search features were not really well supported. Google's Desktop Search uses some really fancy technology to index emails and all files on your desktop unobtrusively, but their approach is too generic and not oriented towards email search. As an example, there is no easy way to locate an email and drag n' drop it into a new email draft. This is such a common operation and the lack of support for this feature made me look at other products. X1's search and interface are really powerful, but you've to pay $50 for a single-user license. Not a steep price for its functionality, but still a greater barrier than the free products. Some of my colleagues use Copernic and NEO. Copernic, like Google Desktop Search is a full computer search tool and NEO is primarily an email organizer, but with better search capabilities than Outlook. I'm sure there are a few more such utilities, but these are probably the major ones.

Does this mean that a company, once it has established itself as the market leader, finds no incentive to innovate? Both Microsoft and Tripwire went into sustenance mode because they maneuvered themselves into a position of strength. However, they are now facing a lot of heat from highly innovative and nimble competitors and I expect to see some major enhancements in both Outlook and Tripwire very soon. This maybe either through organic product enhancements or through integration with other tools.