When developing a new offering, weather a new product or a service, we analyze our competitors and look at their offering. Then based on results, we try to position our new offering, and maybe optimizing our product or service to attract a specific group of consumers. This optimization usually is based in offering better quality, better price, or a few new functionalities.
How do you make sure you’re not overlooking latent needs that your competitors have never looked at, they have taken for granted or simply didn’t consider because it’s outside their scope? How can you really differentiate from your competitors and create a new offering?
Offer something no one has dared
To be disruptive in your industry, you need to look beyond your current market boundaries and try to find needs that haven’t been addressed well, can be addressed differently, or even consumer haven’t realized they needed, as Apple did when they introduced their iPhone.
A way to exploit creativity and look the problem from a different angle is by exploring six different paths. These six paths were introduced by W. Chan Kim and Renée Mauborgne in their blue ocean strategy. The six paths includes looking beyond your industry, look at other niche markets, consider all your stakeholders, map the whole user’s journey, appeal customers differently and look for trends.
1) Look beyond your industry
When analyzing the competition for our new business idea, we usually don’t consider all the possible options from the customer point of view. Take an example of restaurants, if you wanted to establish a Mexican restaurant in your city, you may look for how many Mexican restaurants are in your area and see what they offer and their quality, you may as well look for other types or restaurants, and even cafes and bars in your area. However, from a consumer point of view, the truth is, restaurants are just one of the many options they have. For instance, if you want to go out in the evening, you can go for a dinner, but also you may want to go out to the movie theater to watch a movie, see a play, go dancing, go to a friend’s house, and so on. These are alternative options, which are also competition from the consumer point of view. Looking what other industries offer, may help you find factors never offered before or that have been taken for granted. You may ask a question, what makes people choose one option over the other? Looking at the alternative options across industries from the consumer eyes will help you identify innovative options never offered before.
2) Look at other niche markets within your industry
A product or a service cannot serve all consumer types, and therefore you need to define your audience. However, when doing so, you may neglect other groups and why consumers trade up for a (usually) higher price or trade down for (usually) a lower price. This doesn’t mean that you need to attract a larger customer base, what this means to understand and identify the main reasons why people go for something higher or lower. Identifying these aspects may help you offer something different from your competitors. For instance, if you’re aiming for a lower-end product, it might help you identify what options are usually found at a higher level and that people care, and in order to compensate costs, reduce or eliminate something users usually care less.
3) Look at all the stakeholders involved in the buying process
In many cases, the buyer is not the same as the user. For instance, when buying a toy for your kid or flowers to your partner. Most of the products or services are focus to attract only a certain group (e.g. the father or the kid) but few take into consideration all the stakeholders. For instance, if you were creating a toy which is rather expensive but relatively small to be easily lost. Why wouldn’t you try to create a toy which is both appealing to the kid but at the same time it can be found if lost? This may appeal to both the parents and their son. When you’re analyzing introducing a new product, you should ask the question who are the main group the industry typically focus on, and how you can shift or appeal other groups so you can generate new value.
4) Look across the whole user journey
Imagine you’re going on holidays and you make a reservation via your favorite online service. The way how you use the online service depends where you are exactly in the process. Think what key options you’ll like to have easily available when: a) you’re searching for hotels, b) when you are making the reservation and paying it, c) when you just land to your destination and you are heading to the hotel, d) when checking-in e) during your stay, f) when checking out d) after you return home. Probably, when looking for hotels you’d want that the option “Search” is easily accessible, but, when you’re heading to your hotel, you’d like to have available the address of the hotel. Looking at the whole path will probably help you identify pain points even before or after you provide the service (e.g hotel reservation) and try to see how you can improve.
5) Appeal customers by functional or emotional factors
Most of the products or services tend to appeal customer by either their emotional or functional factors. Take the example of the solar panels. Since the moment solar panels where invented, thy focused on attracting users not necessarily by how well the panels look like, but rather the functional factor that it produces electricity. However, this is changing with the new panels from Tesla Solar roof, where they included an emotional appealing that a house will actually look better by using their panels. Similar to this, you may think what the industry mostly focus on (functional or emotional) and challenge the conception. How can you make something usually focused on their functional utility towards the emotional aspects (e.g. give status, etc) or the other way around. This may help you uncover added value never offered before.
6) Don’t focus in the present only
If you were going to introduce a new services or products for cars, maybe you’ll need to consider the current trending on hybrid and/or electric cars and how this will affect the consumer behaviour and how this will influence their decision when selecting a product. Loooking at trends and how things evolve may give you a competive advantage, however it’s also one of the most riskiest approach as we can never be sure about the future. However, if done correctly and betting on trends reasonably, may put you ahead of other competitors.
Going beyond the traditional boundaries in your industry may help you uncover functionality never offered before, and help you differenciate you from your competition.