Design Products That Won’t Become Obsolete

Authors: Vijay Govindarajan, Tojin T. Eapen, and Daniel J. Finkenstadt

In 2017 Radio Flyer, the maker of the iconic Little Red Wagon, introduced a remote-controlled, battery-operated car that kids can ride on. It has three modes of operation, each of which is suited to a different growth stage for young children. In stage one the car is controlled remotely by a watchful parent. In stage two the child drives the car, but parents can override any questionable decisions. In stage three all driving decisions, safe or concerning, are made by the child. Radio Flyer gave its new product a simple name, one that made its abilities and selling points perfectly clear: the Grow with Me Racer.

The Grow with Me Racer is just one of many commercial offerings today that can change and expand to suit users’ evolving needs. We, an academic and two consultants with more than 20 years’ worth of experience studying product development, refer to them as “products that grow.” In recent years they’ve become more numerous and ever more complex. Consider the Google Android and Apple iOS operating systems, which are routinely updated to add capabilities to smartphones. Tesla improves the performance of its cars nearly every month by issuing software upgrades. John Deere can add features to its harvesting combine machines through software upgrades, without altering the hardware. Senior citizens can now overcome the creeping impairment of presbyopia with tunable eyeglass lenses made by Deep Optics. Medical researchers are testing implantable pediatric devices, including a heart valve and stent, that can grow with the bodies of their young recipients. Even the content of this article is a product that grows. Through an online GPT, accessible at ptgchat.com, users can apply the article’s principles to various contexts and access advice that is regularly updated with new information.

Such products offer enormous potential to companies and their customers. Their ability to evolve can greatly extend their useful life, eliminating or postponing the need for replacements and allowing users to become more familiar with them, two factors that increase customer value. Delaying or removing the need to manufacture replacements promotes sustainability, conserving energy, reducing harmful emissions, and slowing the accumulation of toxic materials. Products that grow offer a way out of the ecological quicksand of planned obsolescence, a profitable but wasteful strategy that consumers dislike. They help companies protect their reputations and save consumers money.

Building a product that grows isn’t always as easy as updating software, however. Knowing what consumers want today can be difficult; now companies will have to predict what customers will want five or 10 years from now. That will require firms to rethink how they develop and design new products. And because adaptable products may be harder to build or repair than traditional ones, companies will need to figure out how to avoid driving up the total cost of ownership. Continual software updates also may make users worry about losing control over their personal data or becoming more vulnerable to security breaches. Finally, users may find themselves burdened with features or functionality that exceed their wants and needs.

Despite those concerns, we believe that products that grow will serve businesses well. Managers who switch to them from static products will position their organizations for success in a market that increasingly emphasizes adaptability, longevity, and environmental consciousness. The era of use-and-throw-away will be replaced by a new age of use-and-grow, allowing companies to harmonize customer needs and sustainability demands. In this article we’ll examine the categories of offerings that are already benefiting from this approach, and we’ll detail how companies can begin to integrate products that grow into their current strategies.

Idea in Brief

• The Opportunity

Products that grow, or adaptable products, offer more value than products that aren’t designed to change.

• The Challenge

Knowing what consumers want today can be difficult. To create adaptable products, companies will have to predict what customers will want five or 10 years from now.

• The Payoff

Brands that can build adaptable products will be seen as pioneers in a market that increasingly emphasizes flexibility, longevity, and environmental consciousness.

Ways That Products Can Grow

Adaptable products aren’t a new phenomenon. But modern technology has made it easier to create them. Thirty years ago software was released in a single, final version, but today digital products, like your phone’s operating system or apps, can be immediately adjusted and improved through software updates. Hardware products, like smart appliances, can be equipped with software that changes their functionality in real time. Any company with digital offerings can use software to upgrade products and lengthen their lives.

Products that grow are already revolutionizing education, toys, sports equipment, and other markets. Toys and games that teach coding to children, for instance, are designed to unlock new features or challenges as kids reach new skill levels. One of them, Learning Resources’ game Switcheroo Coding Crew, features modifiable vehicles and a 46-piece interactive play set. Moxie, a teaching robot for autistic children aged five to 10, tailors its lessons to the knowledge of its users. Training equipment for sports teams and productivity tools for work teams can both track the joint progress of multiple users and adapt their functions to suit the group’s skill level.

Our study of the market for adaptable products, which looked at more than 150 products from a wide variety of industries, reveals that they’ve been helping customers overcome seven challenges, including some they’ve been addressing for decades:

1. Age-related developments. As children grow, they often need products that can be modified to suit their increased size and skills.

2. Age-related challenges. At the other end of the spectrum, the abilities of older users (such as vision or physical strength) often decline in ways that gradually alter the products they need.

3. Congenital limitations. Medical conditions and physical disabilities can evolve over the course of people’s lifetimes and generate new requirements for support.

4. Desire for novelty. Customers often lose interest in products that stay the same.

5. Shifting learning needs. The difficulty and volume of information presented to students need to be set at the level that’s currently appropriate for them.

6. Technological evolution. Changes to features and underlying technical specifications often prompt a need for upgrades.

7. Shifting performance needs. Many kinds of machinery and equipment require constant mechanical improvements.

How Adaptable Products Are Built

Companies can meet those challenges in four distinct ways. The approach that works best for your company will depend on your industry expertise, the new product, and your technical acumen.

Configurable hardware

Some products have hardware that can be adjusted to users’ needs. They include wheelchairs with modular bases that can grow, shrink, or be reformatted as the customers’ medical equipment and storage needs evolve. Another example is Radio Flyer’s 4-in-1 Stroll ’N Trike, which can morph from an infant tricycle, to a steering tricycle, to a learning-to-ride tricycle, to a classic tricycle to suit riders of varying abilities.

Preconfigured software

Some products learn from and adapt to the user to improve her experience as her knowledge of them evolves. Smart sports equipment, for example, contains software that gives athletes feedback on how to improve their performance.

Updatable hardware

These products are designed for customization and repair. Take smart security systems, which offer modules that allow users to add new physical devices, such as fingerprint scanners, facial recognition cameras, and advanced motion sensors.

Updatable software

Unlike preconfigured software, some software receives constant updates that enhance products over time. The user may request an update, or the manufacturer may push it out. Smart cars that get software updates and smart thermostats whose algorithms are tweaked to increase heating and cooling efficiency are both examples.

A Competitive Advantage

Across these categories of products, there are several ways companies can separate themselves from the competition.

Increased engagement

A product that grows allows a company to forge valuable longer-term connections with customers. With both digital and analog products, the company can involve customers throughout the product life cycle, bringing them into the product development process and regularly probing them for insights into new opportunities rather than just gathering their feedback on existing products. Such interactions build more-enduring relationships, strengthening brand loyalty and value. Eventually they can even foster the growth of communities around a product, which take on the task of identifying ways to improve it. OpenAI’s launch of custom GPTs is a good example. The company allows customers who pay for a premium ChatGPT subscription to tailor the baseline GPT-4o model to specific use cases. The user can also offer the resulting custom models for sale on the firm’s GPT store, a capability that drives engagement through monetary rewards and the intrinsic motivators of creativity, autonomy, mastery, and social connection.

Flexible market response

Products that grow allow companies to react quickly to changing market demands and evolving consumer preferences. The strategic integration of adaptable features can also help companies attract new customers without undertaking a product overhaul.

Consider the electronics startup Fairphone, which prioritizes sustainability and ethical production. Its smartphones have a modular design that lets users easily replace or upgrade key components like the battery, screen, and camera without professional assistance. That not only extends the device’s lifespan but enables the company to adapt to market trends by offering new features.

Continual innovation

Unlike products with static designs, products that grow may require regular improvement even after they reach the hands of customers. This forces companies to perpetually innovate, which can help push them to the forefront of the market.

Positive social impact

The longer life of products that grow shrinks their environmental footprint. As we’ve noted, companies generate less waste and use fewer resources when there’s less need to dispose of products and manufacture and market replacements for them. The cost of disposal can be very high in many countries, so products that grow can significantly reduce the amount of money spent on managing refuse. While the relative complexity of some adaptable products might make them more difficult or costly to dispose of, they still minimize the product returns that pile up in landfills. In an era when businesses are evaluated for their environmental and social impact, products that grow can help their makers position themselves as responsible organizations with a strong social purpose.

Models for Capturing Value

Some companies may worry, understandably, that adaptable products may be less profitable in the long run than traditional products are. After all, companies that sell more products make more money, and planned obsolescence has been the quiet engine driving much of 20th-century commerce. But there’s plenty of evidence that the products-that-grow approach can be profitable, whether adopted as an overarching business strategy or as a component of a broader company program that strives to balance customer focus and sustainability. Software-enhanced vehicles that allow users to update features on demand are expected to create $650 billion in value for the auto industry by the end of the decade, for example. Fairphone increased annual sales of its modular products from 88,000 units in 2021 to 170,000 in 2023 and was profitable for three straight years from 2020 to 2022. (In 2023 it decided to make a big investment in its future growth and took a loss.) With the help of its adaptable products, Radio Flyer’s revenues and profit grew at a compounded rate of 10% annually from 2018 to 2023.

Several pricing and business models for adaptable products can help companies grow the value pie and share it with their customers.

Premium pricing

Because an adaptable product can replace multiple purchases of similar products, a company can charge more for it. In the footwear industry, Because International, a nonprofit that fights poverty, has created the Shoe That Grows, an affordable shoe that expands five sizes and lasts for years. If a for-profit company sold an expandable kids’ shoe, it could price the shoe higher than a single-size one but below the total paid for additional pairs of larger sizes. Though the company would earn more profit per unit, the customers’ overall costs would fall.

Charging for upgrades

Makers of some products, such as smartphones, could offer a subscription service that regularly adds new features like premium content or exclusive functionality. Companies could also charge extra for personalization and product modifications.

Products as services

Companies can sell adaptable products as services. A business can retain ownership of them and simply charge its customers for every use. The Moxie robot, for instance, has a subscription model: The pricey learning tool can be rented for $100 a month.

Complementary products

The prolonged life cycle of products that grow gives companies greater opportunities to develop complementary products. Along with accessories like headphones, earbuds, chargers, and protective cases, Fairphone sells replacement parts for its products and a custom screwdriver for installing them.

Complementary services

Manufacturers can charge for services such as monitoring (for medical products) or training programs (for sports equipment) associated with a product’s use.

Monetizing maintenance

Because adaptable products last longer than most offerings, they may need more repairs. Companies can make money by selling their users product warranties and extended guarantees. While industrial and B2B products that need complex repairs traditionally profit from this model, consumer goods companies are now adopting similar strategies. Keurig, for instance, has done so in the coffee industry.

Keurig’s K-Duo line of coffee makers, which are capable of brewing both a single cup and a full carafe, caters to diverse consumer needs. At the same time, K-Duo has streamlined manufacturing processes: Making an all-in-one product is simpler and more efficient than making multiple kinds of coffee makers. By offering maintenance kits for these machines, Keurig has opened new revenue streams and supported right-to-repair initiatives. The coffee makers’ extended life cycle also reduces Keurig’s competition risks. This is a great example of how a company can simultaneously lower its production costs and generate recurring revenue through maintenance solutions, creating a win-win scenario for both the business and its customers.

Brand communities

Adaptable products offer an opportunity to establish online platforms or forums where users can exchange experiences, tips, and customization ideas related to the product. Companies can introduce a membership fee for access to premium features, exclusive content, or priority customer support within the community. Peloton is a great example of a firm that has done this well.

Resale and modification services

Some products will have multiple owners throughout their life cycle. In such cases a company can offer services for refurbishing or modifying the look or style of a product for reuse and create platforms for resale. This can be done with toys, cars, and industrial equipment. For example, a bike purchased for a child whose interests are in space-themed activities could be modified for use by another child who has an interest in dolls.

These are just a few of the ways companies are monetizing and building competitive advantage with products that grow. As companies experiment with and produce more adaptable products, new models will emerge that provide as much or even more value.

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Integrating products that grow into a business strategy requires a solid commitment to sustainability, customer satisfaction, and perpetual innovation—three things that in the long run will serve companies well. Brands that can make this switch will be seen as pioneers in a market that increasingly rewards adaptability, long-term value, and environmental sustainability.

We predict that technological progress and the increasing complexity of our lives will drive up sales for products that grow. These offerings appeal to young and old alike. They allow companies to meet the changing preferences of consumers and the unending demands of a world that requires faster computers, safer vehicles, and greater efficiency. As the world changes, so must the products we design and sell.