A Product Doesn’t Have to be Unique to Succeed
Disruption demands respect for all aspects of business and customer experience
Every business should be disruptive, or it will become extinct soon — this is what we are told on every corner. Startup failure rates can sweep anyone off their feet (according to Failory, it’s 90%).
Embarrassed by the numbers, founders start agonizing over the unique selling points their product must have, desperately looking for the features to become the adornment of their product.
Hold on. Breath out. Let’s get all the ducks in a row.
Have you looked into the causes of new-business failures yet?
You absolutely should. Learning from others’ mistakes doesn’t make your venture infallible, but it’s way cheaper than learning from your own mistakes.
Provided by CB Insights
Surprisingly, none of the causes for failure is about being non-disruptive.
… Or is it?
What is disruption, exactly?
Cambridge Dictionary says disruption is “the action of completely changing the traditional way that an industry or market operates by using new methods or technology.”
The world knows examples of unicorn product ideas that absolutely destroyed our old habits and brought about a new reality virtually overnight. But should/can every new product and every new business be like that? Nope.
Still, there are plenty of survivors that manage to thrive in the most turbulent markets.
How do they do that?
Looking back at the causes of startup failures, we can see three meta-categories:
1. Poor market and macro-environment intelligence
Ignorance of the business environment, poor awareness of ever-changing market conditions, and disconnection from the target audience altogether lead to creating a product nobody needs, nobody wants to use, and nobody wants to pay for.
This covers such causes (from the illustration above) as “no market need,” “pricing/cost issues,” “user un-friendly product,” “poor marketing,” “ignore customers,” “product mistimed” and “legal challenges.”
2. No vision and strategy
Added to the poor market and macro-environment intelligence, this leads to blindly rolling the dice in the hope of spotting a workable business model, rather than evolving through a set of well-planned experiments and controlled pivots. How can one assemble a stellar team of best-for-the-purpose professionals without understanding where they want their business to be in a year, and what milestones they want to reach?
The inability to learn from your competitors’ strategic mistakes and predict their next moves is also included. “Not the right team,” “get outcompeted,” “product without a business model,” “lose focus,” “pivot gone bad,” “failed geographical expansion,” “didn’t use network” and “failure to pivot” go here.
3. The consequences of the two above
Strategic chaos and uncertainty entail the loss of focus and disorientation, while ill-fitting hires result in distrust, demotivation and fatigue among the stakeholders. That’s what you can read behind “ran out of cash,” “disharmony among team/investors,” “lack passion,” “no financing/investor interest” and “burn out.”
Such meta-categorization vividly demonstrates that the chance for survival out of luck is too small to bet on. Even with an ingenious product idea, no business will live long and prosper without applying a holistic approach to found, sustain and scale it. A unicorn product can easily be copied by mature competitors, and the idea, itself, can get a brighter reincarnation in the hands of smart fast-followers.
True disruption comes not from the unique product itself, but from a winning combo: a market with the promising follow-on potential, a pervasive market problem backed with high demand, and an effective and efficient way of solving it.
And once you have the combo, you need to play it right: Come up with a strong and unique value proposition, encase it in a sustainable and scalable business model, get the right people on board to bring that all to life, and serve your customers in a way that keeps them engaged and loyal.
The whole product
A powerful weapon that hits multiple targets and can help you get there is the concept of the whole product. It was first introduced by Theodore Levitt and Regis McKennstems, then popularized by Geoffrey Moore in Crossing the Chasm.
You can also get a short-but-quite-good-for-the-start grasp of the concept from 280Group. They also suggest a 3-layer variation of the model:
Whole Product Concept — A Quick Guide for the Expert PM by 280Group
I practice a 3-level variation recommended by 280Group. To me, the 3-level model has more contrast and distinction between levels, as compared with the 5-level model. This makes it more effective in communication with stakeholders, and it enables faster comprehension and alignment. The latter is vital for the synergy across the org, both strategy- and tactics-wise.
Narrowing a product down to a piece of software or a physical thing constrains its uniqueness to the set of features.
The whole product concept expands the frontiers, emphasizing that the uniqueness goes far beyond that and spans those different aspects of the customer’s experience — everything that augments the actual product and contributes to its success: messaging, packaging, buying process, value-added services, warranties, integrations, delivery, etc.
All together, these elements must create compelling value for a customer, empower the establishment of a unique position on the market, and form the strong competitive advantage.
A bit of philosophy
When meteors enter the atmosphere, they turn into a burst of light. While they fall down and crash a moment later, we get amazed by the view, so we call them falling stars. But meteors are not stars, and they never were.
It’s the same with business: Chasing for uniqueness as salvation of all evil is a race to the downfall, with eyes wide shut. People will admire that burst of light, but it won’t last and will be forgotten soon.
Think big. Target all fronts. Your true uniqueness may be coming not from the product idea, but from the approach you take to create, present and deliver value. Build your business to be a star, not a meteor.