UPOD: Under Promise AND Over Deliver
It is a basic life principle we have all learned. Recently, a startup company called Coin needed a reminder. They're building an interesting product that stores all your credit cards in one device. Great idea, right?
Coin is a great example of the balance of being first to market and delivering on promises.
Coin is a case study on doing almost everything perfectly. Unfortunately, they missed on one of the basic human principles - and in doing so created an avalanche of negative press and rage.
The story of Coin: a crowd funded project that went viral. They had a goal to raise $50,000 and did so in 40 minutes, shorter than it would take to pitch a group of venture capitalists or angel investors. It was so successful you couldn't get away from it on any of the social media sites.
Here is what they did very well:
- Slick video updates and created a members-only feel for early adopters
- Created a "tribe" of loyal customers that prepaid for and help fund the company
- Well capitalized- They raised over $15 Million in private funding after crowdfunding
So how could a startup that had a legion of loyal customers that was well-funded with a blue ocean strategy and product similar to Apple had with the iPod miss the mark?
Here is where they failed:
OPUD - Over Promised and Under Delivered
Summer Ship Date!
From day one they had promised to ship by summer 2014. Even recently they sent out an update to the funders, "our testers are busy in the field working to fine tune the project we are still on a summer ship date". I found myself getting anxious or tense thinking summer is almost over, they had promised. I had to check myself and say, "John, really, over a credit card thing?" An email arrived 8/22/14 and said the ship date has been moved back to Spring 2015. The beta testing program is available, but the product only works at 85% of the terminals used to swipe credit cards. (If you think you had a bad week you should look at Coin's twitter account. I actually feel sorry for them in a way, as their tribe has definitely turned. The next day, an apology email did come out offering a free beta. A real risk they face now is the legion of fans they created in the tribe are now detractors hoping they fail.)
What would happen if they had promised all along to have a Spring 2015 ship date and offered a beta test early or even had the finished product ready by fall 2014? Or what if the CEO who put together the original persuasive video built an apology offer with some bit of reward in the first email? The tribe they have created would have continued to march along, hoisted them up on a throne and carried them away and revered the team like a king.
I believe this will be a case study that MBA students will be reviewing for years on how UPOD can potentially derail a great idea. Who knows what is in store for Coin, this is effectively a toy that makes you look cool and in the grand scheme of my life solves what is probably problem #120.
My goal for writing this is not to complain about Coin, as I understand what it is to run a business. Things cost more and take longer to come to market - especially something that relies on others' technology. In your own business, do you teach and reward your employees that practice UPOD to your customers, vendors ,and stakeholders or do you assume (like Coin) did that we can handle it? The real risk Coin faced is UPOD or coming clean earlier. One Twitter follower posted, "the internet can build your startup overnight, and the internet can bulldoze it just as fast".
You don't want to have the hash tag that is trending right now #coincon #coinfail and have to deal with the social media rage that Coin is dealing with. (Which, ironically, is taking them off task of delivering the beta test on time.)