Tom Dougherty, CEO – Stealing Share

9 April 2019

Design of Nest also its Achilles heel

About five years back, I splurged on a Nest thermostat. Then, as is apropos of my marital existence, I pled with my wife for forgiveness. You see, it was really hard for me to rationalize spending $250 on the uniquely circular thermostat. I mean, what kind of long-lasting joy would the first generation model bring me? Not much, really. But damn, it looked sleek. And one of the Apple designers jumped ship to make it. Owning it was a no-brainer.

NestIt isn’t any secret that I exist squarely in the internet of things. But to me, the Nest appears the most sensible. For those unfamiliar with the product, it’s a circular thermostat with a digital screen. You can spin the outer wheel to locate unique settings on the device, push on the screen to make selections, as well as tether yourself to the Nest app. What’s cool is that the device senses your living patterns. As such, it registers temperatures for when you are home and away.

Here’s the rub. The Nest is so well constructed that I cannot fathom needing another any time soon. And that sucks for business.

Is building a Nest too well made problematic?

It’s the same conundrum that those ugly Croc shoes faced a few years ago. Back in 2009, the company nearly went under. The problem — Mario Batali’s favorite footwear was so well made that nobody ever bought replacements. Crocs were like buying a mattress with a lifetime guarantee. (So why do we need so many mattress stores?)

But alas, I remain pleased as punch with the first model. And sadly for Nest, I probably won’t need another for another 10 years.”

I wonder, too, if this will soon be a problem for Nest. It’s not like an iPad, where I “gotta have the new technology.” It’s a dang thermostat that brings me a modicum of joy. Most of the time, I hardly know it’s there. Which is good, because the product consistently works and never feels obsolete. The market, then, is the unconverted.

Currently, Nest is up to its fourth model, the Nest E (a more affordable version) and its third version of the traditional Nest. But alas, I remain pleased as punch with the first model. And sadly for Nest, I probably won’t need another for another 10 years.

See more posts in the following related categories: branding technology

1 Comment

  1. Chris Ward

    I suspect Nest knew that an Apple-like ‘upgrade path’ for Customers wasn’t at all likely in a category that no homeowner even realized existed until Nest came along. And they priced accordingly. $250 at launch was an astonishing, buzz worthy sum for a thermostat. Their “lifetime value of a Customer” model probably just maximized acquisition price and not the ongoing revenue stream that has gained so much popularity in the last decade. If true, this would bet the business on acquiring new Customers every single day.


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