Reinventing the Wheel in SaaS Is Too Costly: Focus on Differentiation, Not Points of Parity
Donatas Jonikas, PhD
Helping SaaS founders get customers before writing a single line of code | Investor | Author | World's Top30 Startup Coach for 2024
Winning customers comes down to one thing: having a clear edge—your differentiation.
While every SaaS platform must include certain standard features like authentication, payment integration, user management, feature control, and tiered pricing, focusing too much on these "must-haves" can cost you valuable time and resources.
The more energy you spend building and maintaining parity features, the less you have left to develop what truly sets your software apart from the competition.
It’s not just costly in terms of funding but in missed opportunities to innovate and deliver unique value to your users.
This is why founders need to shift focus—leave the basics to pre-built solutions and put your best effort into what will make your SaaS stand out.
How Chasing Parity Slows True Progress
Iman Pouya shared his story as we began working together in the Double Sprint 90-Day Bootcamp . It’s a perfect example of how many SaaS founders get bogged down with parity features and routine tasks, rather than focusing on building true competitive advantages for their software.
In our first SaaS apps, we launched with only a basic password-based login—without even allowing users to sign up. Fast forward a few years, and we’ve transitioned to offering at least three authentication options, with sign-up functionality now a must-have from the start.
Back then, we simply didn’t have the resources and wanted to get our product to market as quickly as possible. We also lacked the capacity to build proper back-office tools for managing users, another essential feature that has since become standard in all our products.
What we learned after building 30+ Saas apps is that the list of business-critical features grew and we spent more and more time on building and maintaining them. This left us with less time to innovate our product. As ambitious developers, we found ourselves frustrated by mundane tasks.
When starting Nebulr , Iman’s goal was to bring products to market quickly, but with all the critical features already in place—without the heavy lifting. That's how Nblocks was born: a platform that Iman and his team built to solve their own problem.
Now any SaaS startup can have these features integrated in a day instead of months! Even with a FREE plan.
Instead of Reinventing the Wheel
There are business-critical features every SaaS must have.
Instead of building everything from scratch, founders can save time and budget by integrating third-party solutions.
However, there are downsides to this approach as well.
Join us to explore which option to choose and how to optimize your strategy for SMBs and enterprise clients. Key aspects we'll discuss:
?? Expectations vs. reality: Development timeframes
?? Use case examples with metrics
?? Soft launch strategies without re-releasing
? Techniques to experiment faster
When you already know how to "cut some corners" building your product, it's time to focus attention on creating a competitive advantage for your SaaS.
Let me be brutally honest.
If your SaaS doesn't have any competitive edge, any meaningful differentiation point, you'll have a hard time winning customers. And most likely you'll be forced to compete on price.
What to avoid that? And charge premium? ??
Read below??
Why YOU? Why NOW? ????
Craft the answers to both questions before building your product or investing in marketing.
Unique value proposition + your differentiation = Why YOU ???
To establish "Why you," ?? focus on your unique value proposition (UVP). Show that your offer - be it your product, payment terms, guarantees, or perks - is beneficially different. Make sure your UVP stands out from the crowd, giving them something they can't get elsewhere.
Macro trends and opportunity + trigger = Why NOW ????
Don't let your prospects fall into the 'we'll think about it' abyss. Highlight the urgency! ?? Align your offer with current market trends that present unique opportunities or solve pressing problems.
Add some spice to your pitch with exclusivity. Limit your offer, create an early adopter program, and show that seats are filling fast! More on it check out this free training .
Competitive Advantage Through 3x Specialization
To establish a competitive edge, we must distinguish ourselves from our competitors. ????
Why? ??
Because appearing identical leads customers to seek discounts and lower prices. ????
Our aim is to avoid this scenario altogether.
Thus we seek to deliver value.
Specifically, to provide specialized value that justifies a higher price point. ????
You can create your competitive advantage through 3x specialization:
?Problem Focus
Your software or platform should target a specific issue.
In a crowded CRM market, for instance, simply labeling your product as a CRM isn't enough. However, developing a CRM that reads incoming emails and suggests follow-up with prospects saving sales development reps (SDRs) time sets you apart.??
? Target Audience
Who are your ideal users?
Crafting your CRM for specific companies or use cases makes it clear who benefits most from your solution. This clarity reinforces the value proposition, justifying a potentially higher price tag. ??
? Solution Approach
Your algorithm, technology, and overall methodology should offer a unique and superior solution.??
To truly stand out, differentiate in ALL 3?? areas: problem definition, customer targeting, and solution methodology.
Begin by conducting a thorough competitor analysis. From there, articulate how your approach differs in each aspect—problem, customer, and method.
Want my Help With Your SaaS Launch?
If you're looking to get your first customers or already launched but aren't happy with the current traction, and need some expert guidance...
I'm here to help??♂???
?? Check out this free training on the Top 8% SaaS Launch Strategy and book a free breakthrough session.
?? Join us on a live event Business Critical Features for Every SaaS Aiming SMB and Enterprise Clients ??
Founder at Nebulr
2 个月Great chat and thanks for sharing our experiences on this subject. The expectation from clients are much higher today than when we started and it takes a bit more effort to create a top level SaaS
Marketing Specialist at "Marketolgai" | SaaS Startups | Partnerships Marketing | Collaborations
2 个月Very informative article, can't agree more with that. Each SaaS founder should focus on building key features and most importantly, finding the competitive edge of their solution to not end up competing on price. Looking forward to this webinar.