Sometimes Late is Worse Than Never

© 2018 Steve Feinstein. All rights reserved.

It seems like timing is everything in life. Job opportunities, investments, political initiatives, travel schedules, etc.—things can work out to maximum advantage or with disastrous results depending on a small shift in the timing of the event.

This is certainly true in business. Companies that have an innovative, exciting new product under development have to balance the need to announce its existence to the market on one hand with their ability to actually deliver the product in a reasonable time frame on the other hand.

Announcing an exciting new product that embodies a brand-new technology or that breaches a previously unreachable price barrier conveys undeniable market advantages to that company. The industry press writes about it and the company enjoys great publicity that shines not only on the new product, but brings great visibility and attention to the company’s other offerings as well. The competition scatters off in a frenzied attempt to match the new product, but since they usually have no idea exactly how the new technology actually works (only having read the press releases and trade write-ups), their efforts are unfocused, time-consuming and expensive.

All of this redounds to the benefit of the company that announces the cutting-edge new product. They have the spotlight. Their market attractiveness goes way up, since customers will want to be “on board” and “first in line” when the new widget is delivered.

Announcing a new product is a double-edged sword, however. Wait too long, and a competitor may beat you to the punch, robbing your forever of your day in the sun. Or even worse, if a company waits too long, the market conditions may shift away from the new product, rendering it irrelevant. If the company had made a more timely announcement, they could have moved the market’s expectations in their direction.

But do it too soon, and you risk burning your goodwill equity as customers and industry analysts alike get tired of waiting for an oft-delayed production date. The market will accept just so many delays and excuses before they write you off completely. The very worst thing that can happen to any company is when their much-ballyhooed invention is delivered to a “So what?” reaction instead of a “Yes! It’s here!” reaction.

Two excellent business examples come immediately to mind.

The first is the Tesla Model 3 electric car. Announced with great fanfare in the spring of 2016, it was going to be the first affordable electric car, suitable for the masses. At an expected price in the mid $30k range, it was no more expensive than a fully-equipped Honda Accord EX. Beautiful, fast and free of the chains of gasoline power, the Tesla Model 3 would be delivered in large quantities by the fall of 2017 and it would single-handedly usher in the era of the practical EV, ending forever the internal combustion engine’s monopoly on the personal automotive market.

It hasn’t worked out the way Tesla led us to believe it would. Maybe they knew all along that they would miss their large-quantity manufacturing dates as badly as they have, but they kept reassuring industry analysts all along that they’d meet them. Their early announcement has spurred rivals like General Motors to fast-track their Bolt competitor, which now (along with other challengers like the new Nissan Leaf) is poised to significantly reduce Tesla’s market impact with the Model 3. Tesla did enjoy the market advantages that accompany an early announcement of a game-changing new product (enhanced corporate publicity, greater attention on their existing products, even financial rewards in the form of advanced Model 3 deposits), but they are paying the penalty now of over-promising and under-delivering: increased skepticism on the part of both industry analysts and frustrated customers and the effective disappearance of their once huge EV technological/market lead.

The second great example of the perils of product announcement timing concerns a small company in the consumer loudspeaker business named Atlantic Technology. In the early 2000’s, the stereo speaker market was changing. The big, ugly freestanding speaker boxes that were everywhere in the 1970’s were no longer acceptable in the style-conscious 2000’s. Built-in speakers, known as “in-walls,” became more popular. These speakers—mounted flush in the wall or ceiling like a heating vent—were practically invisible. No ugly “wooden coffins” ruining the décor. Style-wise, they were the perfect answer.

From a sound quality standpoint however, in-walls were mostly terrible. The wooden box enclosure of those old-fashioned speakers was a major contributor to their great sound quality. Without getting overly technical, it’s critically important to the quality of sound reproduction to precisely control and optimize the amount of air behind a high-fidelity speaker. Simply cutting a hole in the wall’s sheetrock and mounting a speaker in there might get you some kind of sound, but it wouldn’t be true high-fidelity accurate sound.

Atlantic Technology came up with an incredibly clever and simple way to combine the best of both kinds of speakers: their speakers mounted in the wall, as easily and invisibly as conventional in-wall speakers. But…Atlantic perfected an “enclosure” behind the speakers that was an integral part of the in-wall speaker assembly. Instead of just cutting a hole in the wall and mounting a “naked” speaker—like everyone else was doing—Atlantic had an enclosure behind the speaker, sized perfectly to fit in the 3 ½-inch depth of the standard 2 x 4 studded wall. Atlantic’s speakers mounted as easily as anyone else’s and looked similarly invisible once in the wall. The difference was that the Atlantic Technology’s in-wall speakers sounded far, far better, because they had an optimum-sized enclosure behind the speaker, just like the best free-standing box speakers.

Unfortunately, Atlantic showed the new speakers in their very early prototype form at an industry trade show well over a year before they’d eventually go into production. From a manufacturing standpoint, it was a complicated product and there were a lot of time-consuming kinks that needed working out. Six months later, Atlantic showed them again at another industry event, accompanied by another round of press releases promising that “we’re really close now.” Six months later, they did it all again. When the speakers finally came out some 18 months after their initial public unveiling, the speaker market shrugged with bored indifference. Atlantic had cried wolf once too often. What should have been a smashing success that propelled a small company to a new higher level of market visibility and profitability was instead a drawn-out, cash-draining slog that nearly put the company out of business.

Any great new undertaking—whether it’s a new product, a life-changing medical procedure, even a highly anticipated political maneuver—is subject to the laws of optimum timing. It’s a delicate balancing act of predicting the market’s demand and readiness, assessing how far in front of your competitors you’ll be and a very realistic self-evaluation of your ability to deliver the promised entity within a timeframe that satisfies all these conflicting requirements.

Announce and promise too soon, and your target customers will tire quickly of your unfulfilled promises and missed deadlines, rendering your eventual delivery a ho-hum non-event. Wait too long to announce, and your competition may get there before you or you run the risk of introducing a product, service or legislation that no longer has real meaning and value to its original market. In business, economics, politics and many other human endeavors, timing is everything. Late is often worse than never.

 

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