The Case for Selling Products that Adapt

HBR IdeaCast

Harvard Business Review

Leadership, Entrepreneurship, Communication, Marketing, Business, Business/management, Management, Business/marketing, Business/entrepreneurship, Innovation, Hbr, Strategy, Economics, Finance, Teams, Harvard

4.4 • 1.9K Ratings

🗓️ 17 December 2024

⏱️ 26 minutes

🔗️ Recording | iTunes | RSS

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Summary

Many companies make money by selling goods that need to be constantly replaced; think fast fashion, or tech devices that come out in new versions each year. But according to Vijay Govindarajan, professor at Dartmouth's Tuck School of Business, smart organizations are increasingly eschewing that strategy for one focused on products that grow with the consumer through creative design or software updates. He shares several examples and explains how this approach can deliver more value for the buyer – and for the business – over the long term. Govindarajan is the coauthor of the HBR article "Design Products That Won't Become Obsolete."

Transcript

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0:00.0	Got 30 minutes? Join Capital Group CEO Mike Gitlin for a new monthly edition of the Capital Ideas podcast, brought to you by Capital Group, home of American Funds Distributors, Inc. Subscribe wherever you get your podcasts.
0:17.7	Hey listeners, my fabulous colleagues Amy Bernstein and Amy Gallo are back with a new season of women at work.
0:25.8	You know, it's your guide to whatever you're facing at work from anxiety to Gen A.I.
0:31.4	Listen to new episodes of Women at Work every Monday, wherever you get your podcasts. Welcome to the HBR Ideacast from Harvard Business Review.
0:58.2	I'm Alison Beard.
1:06.2	The iPhone is no question one of the most interesting and successful products to be launched in the past two decades.
1:12.1	In one sense, it's amazing how it grows with you.
1:14.8	Regular operating system updates, an app store that lets you install new content and tools,
1:19.2	accessories like air tags or AirPods you can add to it.
1:22.9	At the same time, a lot of us find we want to buy new ones every few years to get the
1:27.1	latest camera
1:27.7	technology or longer battery life or some other new feature. Apple is walking a very fine
1:33.5	line between what product marketers called planned obsolescence, forcing us to continually buy
1:38.6	better versions of what we already have, and adaptability, ensuring that we can improve
1:43.3	and extend the use of our purchases.
1:45.6	Our guest today says that the latter category of products is what will drive consumer
1:49.4	spending and loyalty as well as corporate value going forward. He's here to explain why, and
1:55.4	offer insights on how organizations can make the shift. VJ. Govindarajan is a professor at the Tuck School of Business at
2:01.9	Dartmouth College and the co-author of the HBR article design products that won't become
2:06.6	obsolete. He's known to his friends as VG. VG, welcome. Thank you very much, Alison. So tell me more
2:15.0	about this shift that companies are making from planned obsolescence to product adaptability.
2:22.5	And explain some use cases beyond tech products that include software updates.
	...

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