The startup Juicero proved this. In 2016, they launched a high-tech juicing machine. It was a marvel of engineering, complete with a camera to scan QR codes on packs of juice and an internet connection to verify if each pack had expired or not. The company’s founder, Doug Evans, compared himself to Steve Jobs and touted that his juice press wielded four tons of force.
Juicero also solved the problem that plagues so many juicers–preparation and maintenance. Juicing machines are notoriously painful to maintain. Users have to prepare the fruits and vegetables, a time-consuming task, and the machines need to be cleaned regularly, which nobody likes doing.
With the promise of solving these problems, Juicero raised a whopping $120 million and was off to a running start–only to stumble right out of the gate. First, they priced their machine at a ridiculously high $700, later dropping it to $399. But that was just the beginning.
The consumable packs of fruit and vegetables still cost $5 to $8 each, and the machine’s internet connectivity and scanner prevented anyone from using competing suppliers. So, customers were locked into the high prices. In the end, the value delivered didn’t match the high cost, and consumers balked. Who wants to pay $8 for a tiny pack of fruits and vegetables?
Juicero collapsed, leaving in its wake some very disappointed customers and investors.