Zune

 

•> Company: Microsoft
> Year released: 2006
> Revenue yr. released: $39.8 billion

•Both the Zune and its upgraded sequel the Zune HD ultimately failed to compete with Apple's already well-established iPod brand. Even without various performance issues plaguing the device — at the beginning of 2009, thousands of Zunes froze due to software glitches — the Zune would have had difficulty competing with the iPod. 

•Shortly before its release, Wired Magazine argued that Microsoft's PlayForSure digital music format would be clumsy due to unnecessary and poorly implemented security measures. 

•There was also a sentiment among reviewers that the Zune could never be as cool as the iPod. 

 

 

Zune

 

•With its initial $9 million ad campaignMicrosoft was able to capture only 10.8% of the relevant segment, versus Apple's intimidating 86.1% market share as of 2006. 

•After dismal results, Microsoft would nearly double its advertising investment, but without success. 

•As a result, Microsoft's Entertainment and Devices division lost $1.3 billion in 2006, and then a further $1.9 billion in 2007. 

•Microsoft has virtually abandoned the Zune MP3 player, as well as the Zune brand

 

4 reasons why innovations fail

 

•Studies show that around 60 to 80% of new products fail. 

•Why do so many ideas, innovation projects and new products fail?

•Knowing the reasons for this is valuable knowledge, especially if you know your company's own success killers. 

•After all, anyone who knows the causes of the failure of innovations can set the right measures and accents in innovation management in order to considerably increase the chances of success of innovations.

 

4 reasons why innovations fail

 

•A new product can fail on the market because it does not create real value and therefore cannot find customers. 

•Or a new product can fail internally because development, implementation and marketing do not function perfectly. 

-The idea can be good and perfect, but if the innovation process doesn't work, it will die. 

-On the other hand, an idea can only be mediocre, but if it is implemented and marketed with the utmost commitment and passion, it can become a great innovation.

The conclusion: Whether an idea succeeds or fails depends largely on the company.

 

Reason 1: Wrong decisions

 

•Management often sets the wrong course in innovation projects or when selecting ideas. 

•Wrong decisions can affect the prioritization of ideas, product strategies for new products, selection of variants in development, etc.
The reasons behind this are:

•Insufficient information as a basis for the decision.

•management's own beliefs dominate instead of facts, and decisions are made from the gut, which later prove to be false.

 

 

Reason 2: Low priority for innovation

 

•Despite a strong anchoring of innovation in the strategy papers and the articulated importance of innovation by corporate management, things can look quite different in everyday life: 

-The day-to-day business takes priority as it earns money for today and they have to be solved as quickly as possible

-And innovation remains a lip service. Innovation has a low priority because everyone cares about the day-to-day business first.

•But how to earn the money tomorrow? 

•If the management's commitment is lacking, it runs through all levels of the organization. 

•Innovation is something "new" and brings with it changes that many people cannot identify with or that cause insecurity and resistance.

•In addition, employees are awarded prizes according to annual and sales targets, which means that innovation does not have much room for innovation.

•Information versus reality

 

Reason 3.1: Lack of market orientation

 

•The lack of customer needs orientation is another reason why new products fail on the market. 

•The product does not offer a true and convincing customer value or differentiate itself from existing products.

•Only those who really know their customers and users, their processes and wishes, can develop products that inspire enthusiasm and set themselves apart from the competition - innovative products can only be created with an extensive understanding of the customer.
 

 

Reason 3.2: Lack of market orientation

 

•The lack of market and customer orientation has multiple causes:

•Too much focus on technology.

•we don't want to waste any money or time and start developing.

•No access to customers and customer information because, for example, the sales department does not want its customers to be "stressed" or because of the tension between technology and sales.

•We believe we know our customers, we rely on our own assumptions and the information we have, but:

-maybe  we do not know the latent and often actual needs. 

-we only have the information you hear from the customer in the sales pitch. 

 

Reason 3.3: Lack of market orientation

 

•This is not the way to develop unique products- we need a deep understanding of the needs and tasks of users and customers.

•Investing in extensive customer and needs research is a key success factor for innovations. 

•The more we know about your target groups, the better products we can develop and don't have to rely on half-true assumptions.

 

Reason 4: Slow structures

 

•The larger an organization is, the slower the processes often become. 

-Sluggish processes with long decision-making cycles and communication problems can be a death sentence for innovations. 

•All this has a negative effect on the quality and efficiency of innovation projects. 

•This becomes more and more aware when you see how quickly start-ups can innovate.

•A closer look at start-ups reveals how the organisation itself influences success.

-Due to their size, they are less complex and therefore more agile. 

-They have no lethargic hierarchies and bureaucracies and can therefore act more quickly.

-They are internally well interlocked and networked, everybody knows everyone. This improves collaboration and accelerates processes.

-There are also cultural factors such as greater openness, risk appetite and willingness to change.

 

 

Conclusion: 

 

Usually, a failure is not related to the quality of an idea itself, but:

•to its implementation,

Questions 

 

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1. Prepare a research on the sources of failure of ZUNE 2. Formulate a research problem and hypothesis - where would you search for the reason of failure? 3. What data would you like to collect? 4. What technique would you use to get data? 5. Is it possible you do not need primary data to solve the problem? Could you comment this? 1. Prepare a research on the sources of failure of ZUNE 2. Formulate a research problem and hypothesis - where would you search for the reason of failure? 3. What data would you like to collect? 4. What technique would you use to get data? 5. Is it possible you do not need primary data to solve the problem? Could you comment this?