Why Your Beautiful Product Is Failing While 'Ugly' Competitors Thrive

Here's a fun fact about Craigslist. It looks like it was designed in 1995 because, well, it basically was. Purple links, wall of text, zero visual hierarchy. Design students use it as an example of what not to do. And yet it processes millions of transactions every month while dozens of beautifully designed competitors have died trying to dethrone it.

This should bother you. It bothers me. As product managers, we're supposed to know better. We talk about user experience, design thinking, and all that jazz. But then Craigslist sits there, ugly as sin, making money hand over fist.

The uncomfortable truth is that entrepreneurs and product teams fall in love with the wrong things. We obsess over pixel-perfect interfaces while users just want to get stuff done. We debate typography while competitors with Comic Sans eat our lunch. This isn't just about aesthetics — it's about fundamentally misunderstanding what makes products succeed.

Take Google's homepage circa 1999. Sparse. Brutal. Just a logo and a search box. Meanwhile, Yahoo was building this gorgeous portal with news, weather and stock quotes. Yahoo had the better design by every conventional measure. More features. Better visual hierarchy. Actual graphics. Google looked like a student project. Guess which one won.

Related: Good Product Design Is More Than Aesthetics — How to Balance Pretty With Practical to Attract More Investors

The psychology behind this is fascinating. A significant 34.6% of visitors worldwide indicate that they strongly favor information structures that are simple and easy to understand. Yet somehow, when we're building products, we convince ourselves that users want something more sophisticated. More elegant. More beautiful.

It's what I call "design theater" — when form becomes performance art rather than purposeful function. You see it everywhere. Startups spending months perfecting their onboarding animations while their core product barely works. Enterprise software companies hiring expensive design agencies to create "delightful experiences" for users who just need to export a spreadsheet.

Reddit is another perfect example. Reddit has 234 million unique users, 8.19 billion monthly pageviews and 25 million daily votes — all while looking like it hasn't been updated since 2005. The site works because it delivers exactly what users want: content, conversation and community. Not gradients. Not micro-interactions. Just the stuff that matters.

Stated preference vs. actual behavior

But here's where it gets interesting. Users say they want beautiful design. They really do. In surveys and focus groups, they'll tell you they prefer the prettier option every single time. Then they go home and use the ugly one that actually works.

This disconnect between stated preference and actual behavior is critical for product managers to understand by leveraging data and emerging techniques like conversational interfaces to tailor interactions and anticipate user needs. The data tells a different story than the focus groups. Always trust the data.

Related: Your Product's Design Could Be Costing You Customers. Here's What You're Doing Wrong (and How to Fix It).

How do you know when to prioritize form versus function? Here's my framework.

First, understand the job your product is doing. Clayton Christensen's "jobs to be done" theory applies perfectly here. Nobody hires Craigslist to have a beautiful browsing experience. They hire it to sell their couch or find an apartment. The ugliness actually helps — it signals that this is a no-nonsense marketplace where real people do real transactions.

Second, find your threshold of acceptable ugliness. Yes, that's a real thing. Every product category has a baseline aesthetic requirement. Dating apps need to look better than tax software. But even within categories, there's surprising flexibility. Hacker News looks terrible and thrives. Designer News looks beautiful and struggles. Same audience, same purpose, different outcomes.

Third, test your assumptions ruthlessly. Not with surveys. Not with interviews. With actual behavior. Launch an ugly version and a pretty version. See which one converts better. You might be surprised. I've seen this play out dozens of times — the "worse" design wins because it loads faster, works better on mobile or just gets out of the user's way.

The challenge for product managers is pushing back on design-first thinking without becoming the villain. You don't want to be the person who killed joy. But you also can't let your team spend six months polishing something that should have shipped in two weeks.

Here's what works

Frame everything in terms of user outcomes. Instead of debating whether the button should be four pixels or six pixels from the edge, ask what user problem you're solving. Instead of arguing about color schemes, talk about cognitive load. Make the conversation about effectiveness, not aesthetics.

Also, celebrate ugly wins. When Reddit's valuation hits another billion, mention it. When Craigslist outlasts another competitor, bring it up. Build a culture that values results over refinement.

This doesn't mean you should make ugly products on purpose. Delightful design can certainly make good products great, but that only matters if the product is actually useful, usable and reliable in the first place. The point is to sequence your priorities correctly. Function first. Then form. Always in that order.

Related: The Art of Creating Great Products

The most successful products find the sweet spot — just enough design to not actively repel users, but not so much that it gets in the way of the job to be done. They understand that sometimes, ugly is exactly what users need.

Your beautiful product might be failing because you're solving the wrong problem. You're making it pretty when you should be making it work. That's the trap. And now you know how to avoid it.