The malleability of digital products

Last post was about the first of the two fundamental properties of digital products that I believe necessitates us to think about them differently, their zero marginal cost. This post is about the second property: their malleability, that is how easy they are to change. 

Software wasn’t always easy to change. Once it was launched, distributed on CDs or floppy disks and installed, software was impossible for the company to change unless the customer proactively bought the new version. However, with the internet, SaaS and cloud services almost all software companies can now push out changes continuously, doing small improvements. This is quite unique, in other industries once a product has been launched the company more or less loses control over the product.. 

Isolated for the individual company, this is a good thing. They can fix things after a product has been sold and improve it based on changes in market conditions or changes in customer preferences. The problem for the individual company is that this benefit is available to all companies in the market. What starts as the “nice to have” of getting improvements to the product after you’ve purchased it then very quickly becomes the baseline and expectation of customers. 

I believe these types of liquid expectations (expectations on e.g. UX is affected by other services not just your competitors) increase the uncertainty for digital product companies. Who could for example have foreseen that “Dark Mode” would be one of the most requested features in the fall of 2019? Digital product companies need strategic process that can incorporate these types of uncertainties.