4 Steps to Product Differentiation

When markets are commoditized, and most of them are, product differentiation is quite the mountain to climb. Are your product marketers and managers up to the task? If not, then the future of your organization is questionable.

I. Learn From Adjacencies and Beyond

I worked with a team fielding an AI customer support solution, Our problem was that the search and discovery workflow for Level 1 customer support staff was clunky. It did not prioritize a user experience that sped up a support research process. The existing workflow had too many steps and was slow to search, retrieve and rate 3-5 possible solutions. So we looked outside our market for product inspiration. We evaluated solutions in the Legal Market - eDiscovery solutions, eCommerce - Sitecore and Etsy, and Hybrid Retail - Algolia.

II. Go slow to move fast

While “the need for speed" is commonly glorified, it can yield REALLY BAD outcomes if approached without a plan. We work with individuals who sometimes boast about their rapid delivery—hiring in abundance, securing ample funding, and expanding their user community. However, wanton speed won’t lead to succeed. Allocate ample time to execute tasks diligently, even if it entails initial progress at a more measured pace.

The most important thing to do in the early stages of product discovery is to quickly get feedback on your ideas. This means testing your hypotheses as soon as possible and learning from what you find. The faster you can do this, the more likely you are to succeed.

III. One conversation > 50 PowerPoint slides

Having had the privilege of working at companies like SAP and LexisNexis, I've been exposed to vast amounts of data. By running choice analyses and attitudinal segmentations, product offers were rapidly developed.

But could we rely solely on quantitative analysis? To truly test and optimize our offers we sat with customers. We leveraged business ethnographic techniques - participatory interviews, follow-me homes, and other techniques to optimize every product/service/packaging approach we could dream up and then test them in the market.

IV. Focus on customer experience

When markets are commoditized, and customers don't see substantial differences between product options, the only substantial differentiator is the customer experience that the brand delivers. Delivering a delightful, easy, and engaging experience drives customer loyalty. Think about it this way:?customer experience is positively correlated to the way people perceive the product or service you’re offering.?In fact, customers with brand loyalty are more likely to include solutions in an evaluation set and pay a premium for the product.

Customers vett their product choices on things we used to call "intangibles". They are not intangibles but essentials in crowded and commoditized markets.

Final Thoughts…

Differentiating products for preemptive market advantage is not easy. It takes close collaboration among product management, marketing, and development. It requires a thorough understanding of market and customer needs, and vetting needs to take place regularly as customer needs are fickle. If you don’t, then the product/service/offer will miss the mark. It's akin to heading out on a Friday night for some axe throwing, but instead of facing the target, you end up aiming at your friends. Things are bound to get messy.