Why the failed Amazon deal forced iRobot to rebuild its tech

This article summarizes an episode of Automated Podcast’s video series featuring Gary Cohen, CEO of iRobot.

Photo credit: iRobot

Gary Cohen, CEO of iRobot, warns that the robotics industry is making a mistake by focusing exclusively on complex engineering. Following the collapse of a planned acquisition by Amazon, iRobot is abandoning its traditional development model.

If the company continues to rely solely on technical specifications, its traditional way of building hardware will no longer work. The company must rebuild its product strategy from the ground up to prioritize usability over raw power.

In his view, surviving this transition requires treating the failed sale as a wakeup call. Companies that adopt a customer-first approach and focus on useful home features may win mainstream buyers that engineering-focused firms can no longer reach.

The cost of stopped development

The failed Amazon acquisition proved that waiting for regulatory approval is rarely just a pause in business. Cohen sees it as a dangerous period that can destroy companies that halt their research.

Pointing to the attempted sale to Amazon, Cohen bluntly notes that the company “stopped innovating” for five years while waiting for the deal to close, allowing fast competitors to steal market share.

A rapid recovery requires speed
To recover from this standstill, the company had to rapidly resume its product development by abandoning the old plan. Cohen explains that the team was “able to quickly flip and clean up the post-Amazon issue” to launch an entirely new product line in just nine months.

Rethinking the fight over features

Moving at that speed also required a shift in focus, as a strategy that relies heavily on technical specifications alienates normal users. Attempting to win buyers by simply adding more suction power or extending battery life creates a confusing market that keeps overall adoption low.

This constant fight over minor technical details has kept sales in US homes at under 20 percent.

“When we just compete against our competition with feature wars,” Cohen argues, “we’re just going after a very small segment of the marketplace.”

Instead of attracting new buyers to the category, manufacturers simply trade the exact same tech-savvy customers back and forth.

Getting customers to buy

To break out of that tech-savvy segment, iRobot recognized that the biggest barrier to reaching new customers is the initial setup process. Trying to configure a new device with confusing applications and complex network settings frustrates buyers immediately, preventing the product from achieving mainstream popularity.

Cohen states that if iRobot can eliminate connection and setup problems, “those are examples of how we’ll grow the category significantly.”

Setting the standard for new products