Having a product that is competitive in the marketplace is a multifaceted challenge. Industrial design plays a huge part, as does marketing. Both of these areas are usually constrained by cost and, on some level, the sales cost of your product. In a competitive market, even a slightly lower price than your competitor’s can have a huge influence on sales.
Many great ideas don’t make it to market and of those that do, many are not commercial successes. We technologists often think that having a superior spec-sheet will guarantee victory over our competitors, but this is not always the case. Betamax and Macintosh are good examples of this. Investors, particularly venture capitalists (VCs), want to see a return on their investment. Marketing plays a big part in this, but it can only do so much. If your product is undesirable or of inferior quality, your sales are going to suffer.
So, when should the design for X process (DFX) be incorporated?
Depending on existing customer research, competing products, release date, and technology readiness levels (TRLs), cost optimisation can be incorporated earlier or later in the process.
For example, if you are developing a product that is completely new and unique, so that you do not have a price anchor, cost optimisation can wait until beta prototyping. Alpha prototypes, in limited number, can be used for customer research, which should give a read on what kind of price the market will tolerate, in turn giving you a cost of goods sold (COGS) target: this would be a looks-like-works-like prototype. Spending time cost-optimising at this point gives few benefits compared to accelerating the design and getting it into test consumers’ hands.
But let’s imagine that your product is notionally comparable to another. Taking design differences into account, you may be able to form an estimate of what customers are willing to pay for your unique selling proposition (USP), or (even better) carry out some consumer research. In this case, creating an alpha with technology that will never be cheap enough to use will not help you later. That doesn’t mean you have to cost-optimise aggressively, but creating a solution with no hope of approaching your COGS target will end up stalling your project when reality hits. One exception to this is if you are using a technology that is falling in price – then it may be worth the risk.
Design for cost can be implemented at a variety of different stages depending on the type of project and the constraints surrounding it. These are just a few of the considerations and decisions you will need to make to complete your project. The only hard and fast rule is that, having determined that cost matters, you take action to control it.