Why Differentiating Your Product is Like Trying to Meet Someone at a Club

I’ll be the first to admit I’m no expert in product management, but I’ve learnt over the years that if you’re chasing feature parity with your competitors, you’re probably not going to succeed. This post is all about why that is, what you should invest in, and how you might be adopting the same strategy to meet people in clubs.

Feature Categories

It’s easy to imagine a pyramid that classifies potential features according to how the market might perceive them. Here’s mine:

• Keeping the Lights On (KTLO): the few features that you need to show some use for your product at all. (Arguably you can merge this into the next category, but I sometimes find it useful to separate it out.)
• Minimum Viable Product (MVP): the set of features that solve the key market need that you’ve identified, and nothing more. In other words, if you’re going to stand a chance of selling to your target customers, these are the features must have.
• Parity: features all of your competitors have, but that are over and above the MVP.
• Differentiating: features that no one else has, i.e. those that make your product unique.

Now, it’s important to avoid assuming that you need to build up your product from the bottom to top. At least, not entirely…

Clubs?

I use the analogy of a person who would like to meet someone to date. If they sit at home all day, of course they’ll never meet anyone. However, if they buy a ticket for entry to a club, maybe they will. When they get into the club, if they are dressed identically, and act identically to every other attendee, it’s unclear why anyone’s interest would be piqued to chat to them versus any of the other “clones”. However, if instead they grab the karaoke microphone, or have great dance moves, they may attract interest. Crucially, it may not matter how expensive their clothing/scent/bar tab is compared to other people’s: they’ve differentiated themselves.

How do parties relate to products? As follows:

• (Being alive and able to go to a party I suppose is KTLO; the analogy doesn’t really stretch that far!)
• Buying the ticket is Minimum Viable Product (MVP): it’s the minimum you need to do to play in the market.
• Possessing the same clothing/scent/bar tab as everyone else is feature parity: yes, you need some form of clothing, but having the same luxury brand as everyone else doesn’t help you.
• The karaoke microphone/dance moves are the differentiating features. They’ll make you stand out (for better or for worse!).

The corollary here is of course that you should invest your resources in achieving MVP, and then focus on differentiating as fast as possible.

But… MVP Changes Over Time

If you adopt a strict definition of MVP, it’s the set of features required to solve a specific market need, in which case that may well not change over time. The exception here is when it comes to software that needs to run on current hardware (or an application that interfaces with someone else’s API): that is a moving target (and arguably just part of KTLO).

However, customers’ view of what the problems your class of products should be trying to address is likely to change over time. Features that once were differentiating become ones that all products have (parity), and others become part of the MVP (“what do you mean that your new car doesn’t have electric windows?”).

What to Invest In?

Clearly to “buy a ticket”, a product must have the MVP features, and continue to invest in KTLO features (these being at the level of “can I continue to use the product”, e.g. support for the latest version of Apple’s iOS for a mobile application). If you can’t achieve those (and keep maintaining them as the market moves) you’re not going to stay in business.

After that, differentiate, and fast. You’ll find out whether you’ve correctly identified what is MVP versus parity features. If you succeed, you’ll capture consumers who do not need all of the features that competing products provide, but who love your differentiating ones. Having 80% of the competitors’ features, but then an additional “10%” of unique ones can be compelling.

In short, Minimum Valuable Product doesn’t mean “same as everyone else’s”: after all, worth tends to correspond to rarity value.