Focus on Differentiation for Market Adoption

Launching a new product in a saturated market segment can be incredibly challenging. Early adopters have already found a product they like, and new customers will naturally be attracted to popular, proven products. Copycats will likely be met with scrutiny. That’s where the idea of differentiation becomes important.

The traditional MVP (Minimal Viable Product) model focuses on, as the name suggests, viability. Will this work, and is there a market need?

But when building a new product in a well-established market, viability is not a concern. We already know it works and that there is demand. Instead, we need to focus on how this new product will be different enough to gobble up some of that market pie.

Better is not differentiation.

A mistake that I have seen a lot, and not just in new products, is the belief that being better is being different. And that is not the case.

Back in my marketing and branding days as a designer, I remember doing a brand workshop for a construction company. We asked what made them different than the plethora of other construction companies in the area.

They kept telling us they were just better. The problem is, better is subjective. We were finally able to tease out their unique estimating process which nearly guaranteed they could complete projects within 5% of the budget, which was lower than any other company could do. That was their differentiator!

When it comes to software products infiltrating a saturated market, we can’t just say we are going to do it better. Better code and better UI/UX are subjective.

MVP should equal Minimal “Valuable” Product.

When designing and building software, we still want to take an agile and MVP approach. The difference is, however, that we already understand the viability of the product. A product that does the same thing as one that already exists will struggle to gain market adoption.

Instead, we need to focus on building out the most unique features that provide new value that other products do not. And we cannot launch before that is built. That means there will likely be added design and development time before an MVP is ready.

Adopt well-established patterns.

What is great, though, about building a product within an existing market is that we can use best practices or patterns from the start.

Having a different UI may not be a solid differentiator from a competitor. There is a reason that eCommerce sites all share very similar layouts. We know what works.

So when building our new product, we should not be afraid to adopt or borrow navigation structures, hierarchies, or layouts.

Another advantage of sharing similar elements with a competitor is that it makes it easier for a new customer to understand how the product works by building on their previous experiences.

Let’s use video game streaming platforms as an example.

A great example of differentiation can be found in the video game streaming market. Currently, there are three major players in it: Twitch, Facebook, and YouTube.

Twitch was the original. It set the standard for how content creators live stream and how their viewers engage with it.

After the success of Twitch, many others have tried to compete with it (think Mixer). They offered all of the same features and a similar user experience: video player on the left, live chat on the right, subscriptions, donations, badges, etc.

However, they did not emphasize differentiation. And while these other platforms could be considered better, they weren’t different. There was no way for them to separate themselves from Twitch.

When Facebook got into video game streaming, the followed the same formula: video player on the left, live chat on the right, subscriptions, donations, badges, etc. The difference was that they had a major differentiator — the content creators already had a list of friends and family they could easily share their content with, all on Facebook. It made it easier for new creators to get started and have an audience.

YouTube has a differentiator as well. They already existed as a major digital media giant, with a majority of the content coming from independent content creators. Many major live streamers are already creating YouTube videos, so why not give them the ability to store their prerecorded videos on the same platform as their live streams?

Different is better; better is not different.

When it comes to launching your new product, avoid striving for just being better than the competition. Always ask yourself: “Does our offering provide enough differentiation?”