I remember really wanting one of these but I'm not really sure for what purpose. The idea of a substantial amount of data off a HDD seemed very appealing, and it was around that time where 1.44mb floppies were no longer sufficient but most people didn't have a CD-RW drive yet. Later in the 90s as CD-RW drives replaced CD-ROM drives there wasn't really a need for Zip drives.

So it seems like to me they had an extremely short window to operate without much competition. CD-Rs being about $15 for a spindle and 6.5x the space was an easy pick.