Digital Product Development: Wins and fails of making online

Shapeways lets you sell your designs online and then 3D prints and ships them for you.
Shapeways helps you sell your designs online and then 3D prints and ships them for you.

What if I told you that you could design and build an entirely new product with NO upfront cost? No factories, no store rooms, no shops. No offices, no bank loans, no flights to China and Karaoke with suppliers to get cheap components. Sounds too good to be true right? Well, in some ways it is. But in others, it has the potential to change how we develop products and solve problems.

But first, what should we call this method? I have settled on Digital Product Development, as it is an extension of Digital Fabrication.

What is Digital Fabrication?

Digital fabrication is when objects are made using machines guided by computers – laser cutting, 3D printing and CNC milling are all examples of this. But an object that is made by a worker loading it into a computer controlled mill rather than milling it themselves, only offers improvements in efficiency of the process. The real gamechanger is the 3D digital file that describes the desired geometry of the object. This means that a design can be communicated across continents and languages via the internet, and fed directly into a machine to be made with very little input from a human. Companys like Ponoko and Shapeways have jumped on this revelation, offering laser cutting and 3D printing services, all through online platforms. And because human involvement is minimised, so are costs.

Much has been written about the third industrial revolution, everybody having a 3D printer in their house and printing everything they need instead of purchasing it. But just like community ovens existed before every home had one, I think its going to start with shared facilities. Everybody being able to design things they want in their house and sending the files mail-order-style to a central (or neighbourhood) manufacturing service.

So what is Digital Product Development?

Digital product development takes the idea of distributed manufacturing made possible by the internet, and applies it to all the other parts of making a product. See the infographic below (Made for free on Canva).

Digital Product Development

Does Digital Product Development work?

My latest test of Digital Product Development has been the Bed Fan. This product is simple: a fan and some ducting that attaches to the side of your bed and provides undersheet ventilation. It provides adequate cooling at a fraction of the noise and energy use of a ceiling or pedestal fan.

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Design: Prototyped using left over cardboard and tape. Concept 3D drawing on cloud CAD service Fusion360 (free if you make less than USD100k). Flat pack lasercut plastic frame drafted on opensource 2D drawing software Inkscape.

Market Validation: Tested on friends and flatmates. Future market validation would be via crowdfunding (what better way to know if you have a good product than if people are willing to pay for it?)

Advertising: Targeted Facebook and YouTube ads. Incentivising customer to share product via social media.

Sales: Via website.

After customer clicks “Buy”…DSC03010

Manufacture: The acrylic frame is manufactured on demand by online laser-cutting platform Ponoko.

Sourcing: The fan and screws are purchased on demand from supplier via AliExpress API.

Fulfilment: This product is designed to be assembled by the customer. That is a common and acceptable practice, provided it is well designed for that purpose. What is not acceptable is the customer receiving multiple packages at different times. So when launched, the packages would come to a central location (me to start with) and I would box, brand and send a complete package. This goes against the “outsourcing” and “no storage” philosophies of Digital Product Development, but the alternative is unacceptable, so I am willing to concede it. In future, this process could be outsourced to a picking and packaging service offered by several freighting companies.

Finance: Since there is minimal upfront cost at this stage, no finance is required. A move to much more cost efficient injection moulding manufacturing methods could be financed by crowdfunding.

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What worked?

The design, sales, advertising and manufacture can all be organised from a single computer. This represents significant improvements on their traditional alternatives. Advertising is the only part that requires upfront costs, but Facebook Ad’s are very reasonably priced, with $100 getting a reach of 10,000+ people.

What kind of worked?

Once the digital fabrication of the Bed Fan is set up, it requires no input from the designer and can happen automatically when the customer clicks “Buy”. This is great! No storage, no organisation required. However the cost of manufacturing single parts and shipping them individually is fairly high, around $37. This price could be reduced to around $10 with a manufacture run of say, 100, then the parts being inventoried. This would also increase the speed at which the customer receives the product. This represents money up front and a departure back to traditional fulfilment systems.

What didn’t work?

Sourcing. Buying components individually from overseas vendors comes with a huge time cost. Airfreight can double the cost of a component, and shipping by sea typically takes 3-4 weeks. Buying many parts and storing them ready for use means orders can be filled quicker, a better price can be negotiated, and shipping rates are much lower.

Conclusion

DSC03039The world may not be ready for multiple component products developed via Digital Product Development. Although a lot was achieved with one computer and no offices or workshops, there doesn’t seem to be a way to get acceptably fast order fulfilment without building an inventory. But if this can be outsourced and built into the cost of the product, the idea still has merit. And at least my nights are now cool and well ventilated!