My Biggest Failure So Far…
07 May 2024 (4 months ago)
Introduction
- Thomas discusses the negative reception of his $160 YouTube G keyboard.
- He aims to share the lessons learned from this failure, including both the mistakes made and the positive takeaways.
The Context
- In November 2023, Thomas's team launched a new brand called Light Mode, with their first product being a mechanical keyboard.
- A YouTuber who specializes in reviewing mechanical keyboards made a video criticizing the keyboard, which Thomas acknowledges was fair and informative.
- Thomas and his team have learned a lot from this experience and aim to share their learnings in this video.
- Despite selling a few copies, the keyboard has resulted in a significant financial loss, with an investment of around $300,000 and only $40-50k made back so far.
Why Did I Make the Keyboard in the First Place?
- The creator aimed to develop a productivity product line, including a keyboard, backpack, and desk accessories, to reduce keyman risk and explore their passion for creating cool products.
- The keyboard design was inspired by the creator's extensive experience with various mechanical keyboards and aimed to create their ideal keyboard.
- The creator's intention was not to establish a keyboard brand but to create a sellable asset that could be potentially sold in the future if they decided to stop making YouTube videos.
- The target audience for the keyboard is individuals new to mechanical keyboards who are drawn to the aesthetic and sound of the product.
- The keyboard is not designed to compete with high-end mechanical keyboard brands like Kyron and IQ Unix.
- The objective is to establish a well-rounded brand that appeals to a diverse range of users.
How Long Did It Actually Take to Make?
- Ali says he spent 12 months building the tech brand, but in a previous video, he said it took 18 months.
- He explains that the discrepancy is due to different starting points for counting the time.
- He admits to getting confused while filming the videos because he hadn't been involved in the product development process for a few months.
- He emphasizes that he's not trying to mislead the audience and that the time it takes to develop a product can vary depending on when you start counting.
- He acknowledges that he needs to be clearer in his communication when filming marketing materials.
- Ali admits that rushing the filming of marketing materials can negatively impact his personal brand.
- He reflects on the importance of taking the time to ensure that the message feels authentic and meaningful.
Why Did I Price It at $159 Dollars?
- The product was priced at $150, positioning it as a mid-range brand.
- The term "very affordable mid-range brand" was misleading, implying both budget and non-budget, causing confusion.
- The higher price point compared to budget brands was due to the small production volume and intricate design and manufacturing process.
- Competing with budget brands was not feasible due to their economies of scale and better negotiation terms with Chinese factories.
- Personal preference and perceived value influenced the pricing decision, as the creator prioritized aesthetics and feel over cost.
- Selling the product at $120 would result in break-even, with operating expenses accounting for approximately 40% of the cost.
- Profits are reinvested back into the business to purchase more inventory and improve product quality.
- Launching a business from scratch presents challenges, such as the lack of volume discounts and economies of scale, making it difficult to compete solely on price.
- The speaker advises targeting customers who value quality over price to avoid a race to the bottom.
Is This Actually a Good Product?
- The product is not bad, but it lacks enthusiast features that can be found in cheaper keyboards.
- The keyboard does what it says on the tin and feels relatively nice.
- The packaging is surprisingly nice with a slippy box, a comprehensive manual, and some accessories including a braided cable.
- Weights were added to the keyboard to make it feel less plasticky and more premium.
- Top-of-the-range keycaps and Gatoron yellow switches were chosen after testing various options.
- The braided cable adds to the sense of premiumness.
What Was Hipyo’s Biggest Problem?
- Hipyo's biggest problem is that he is trying to sell a tech product that is worse than what people could get with a little bit of research.
- He is using his authority as a productivity expert to appeal to an audience that knows nothing about keyboards and convince them not to do their research.
- This feels scummy because he is not being transparent about the fact that there are better options on the market.
- Hipyo says that he is not trying to discourage people from doing their research, but he also does not want to actively tell them to do so.
- He argues that it is not the responsibility of businesses to disclose all of their competitors.
- He compares his tequila brand to The Rock's tequila brand, arguing that The Rock does not need to disclose that there are other tequila brands on the market.
- He acknowledges that mechanical keyboard enthusiasts may not be the target audience for his product, but he still cares about what they think.
- He disagrees with the idea that he is using his authority to make people not do their research, arguing that he is simply sharing his personal preferences.
How Much Money Have We Made From It?
- Made £23,123 at 43p on sales.
- Had 206 total orders as of March 13th.
- Conversion rate is 0.32%.
- Currently at least £200k in the red.
Lessons Learned
- Don't overestimate demand: Thought there would be a bigger market for the product.
- Do market research: Didn't do enough research to understand the market and competition.
- Don't rely on one product: Should have diversified product offerings.
- Manage cash flow: Didn't manage cash flow well and ran out of money.
- Get help: Should have gotten help from experts in e-commerce and marketing.
Lessons Learned
- The creator acknowledges that the Light Mode keyboard project lacked focus and suffered from not being a business priority.
- They emphasize the importance of focusing on fewer things and prioritizing quality, as mentioned in Cal Newport's book "Slow Productivity."
- The project lacked a dedicated team member, and the marketing message was rushed, leading to discomfort in presenting it.
- The creator regrets not ensuring personal comfort with the marketing message and brand vibe.
- The goal of the keyboard project is to learn and test the waters of building a tech product, rather than to make a profit.
- The creator plans to reach out to mechanical keyboard reviewers on YouTube for feedback to improve the product.
- They reflect on their biggest failure so far, which was rushing the production of a mechanical keyboard without proper user testing.
- The creator emphasizes the importance of listening to one's intuition and taking bad feelings seriously when making decisions.
- They discuss the need for thorough user testing with both experts and regular people before releasing a product.
- The creator highlights the importance of setting a high standard for product quality and not releasing anything that doesn't meet their personal expectations.
- The team plans to improve the product in the future by conducting thorough testing and focusing on quality.
Call with Hipyo
- Reached out to Hipyo for a Zoom call after filming the video.
- Hipyo agreed and had a fantastic conversation.
- Discussed the marketing approach for the keyboard.
- Hipyo suggested that the marketing was too heavy-handed and focused on optimization and efficiency.
- Hipyo proposed a product pivot to focus on the personalized experience and delight of using the keyboard rather than making claims about productivity.
- Chuck agreed that this aligns more with his view of keyboards.
- Discussed a line in Hipyo's video where he said Chuck was trying to convince his audience not to do their own research.
- Chuck was confused by this statement as brands typically position themselves as the best and don't encourage their audience to do their own research.
- Hipyo clarified that he meant it from the perspective of a YouTube guru transferring authority from one domain to another.
What is one thing that you're taking away from this?
- Encourages viewers to comment and share one thing they are taking away from the video.
- Reiterates that the goal is not to make an apology video or defend himself against criticism.
- Acknowledges that Hipyo's comments were spot-on.
- Encourages viewers to buy the keyboard if they want, but emphasizes that the purpose of the video is introspection and learning for the future.
- Thanks Hipyo for making the video and causing introspection within the team.