As the market leader, how should we think about defense as it relates to product strategy?

Love this question as well, and I'll approach it from a couple different perspectives. First, I'd acknowledge that some markets are so big or fast growing that multiple amazingly successful winners can emerge. As of today, Apple is worth $2.8T and Microsoft is worth $2.25T. While I'm sure both companies wouldn't mind adding their other's market share to their portfolio, I also think any reasonable person would consider both outcomes desireable.

This example is not to say there's not need to play defense if a market is large or fast growing enough. Quite the opposite, both companies needed to battle furious competition until they helped the market consolidate from multiple dozens of players to a handful. That said, the example highlights that the way we strategize & define "defense" is contextual to a variety of factors, and changes over time.

Second, there's the old adage that the best defense is a great offense. While not perfect, there are a couple ways to translate that sports parlance to business:

1. Recognize if you have a better mousetrap
2. Identify ways you can uniquely innovate 

Keeping Apple & Microsoft in mind, they've demonstrated the ability to innovate on multiple dimensions - product innovation, distribution channels, platform ecosystem and more.

For Airtable, having a clear idea of the type of market we are in, the maturation stage of that market, and our unique / potential pillars of innovation are all inputs into how we play offense & defense. Clarity within these dimensions enables us to lean into or away from potential product investments. While it can be tempting to try to build every capability each perceived competitor has, being rooted in your unique advantages and your perspective of your environment can guide how you think about which areas make sense to defend, and which areas are ok to ignore.

Last but not least, keep your customers first. Sounds simple, doesn't always turn out to be. As company's scale, it can feel harder and harder to track the challenges customers face. Create systems that incentivize people to maintain a customer focus, and fight the urge to over-index on short term, unsustainable wins. As best as you can, set customers up for long term, sustainable, thoughtful success. 

Love this question! Market leaders often get very accustomed to singing their praises and forget to regularly reflect on themselves and their competition. I would advise you and your PMs to regularly assess your feature sets and do competitive walkthroughs of your capabilities against your top competition in the landscape. This will help you spot any potential up and comers in the space.

From a strategic perspective, what got you where you are may not get you where you want to be. So, some critical thinking and UX research on next-generation experiences could be helpful for generating ideas to sustain the leadership in your domain!

Here are some key strategies to consider when thinking about defense in relation to your product strategy:

1. Innovation and Continuous Improvement

• Stay Ahead with Innovation: Continuously innovate and improve your products. This could mean enhancing existing features, introducing cutting-edge technology, or creating entirely new product lines that set industry standards.

• Fast Iteration: Adopt an agile approach to quickly iterate and refine products based on user feedback and emerging trends, ensuring that your offerings remain superior and relevant.

2. Customer-Centric Approach

• Deep Customer Engagement: Strengthen relationships with your customers through regular engagement and by delivering exceptional customer service. Understanding their evolving needs and responding with tailored solutions can increase loyalty and reduce churn.

• Customer Feedback Loops: Implement robust mechanisms for collecting and acting on customer feedback to continually enhance product offerings and address customer pain points effectively.

3. Expand Product Ecosystem

• Build a Comprehensive Ecosystem: Develop a suite of products and services that complement each other, locking in customers by creating a cohesive experience that’s difficult for competitors to replicate.

• Cross-Selling Opportunities: Utilize your existing customer base to cross-sell and up-sell related products, thereby increasing the customer lifetime value and making it harder for competitors to gain a foothold.

4. Leverage Data and Analytics

• Data-Driven Decisions: Use analytics to understand market trends and customer behavior deeply. Leverage this data to make informed decisions about product development and strategic moves.

• Predictive Analytics: Implement tools that can predict customer needs and market shifts, allowing you to proactively adjust your strategy.

5. Strengthen Brand Loyalty

• Brand Positioning: Clearly communicate your brand’s unique values and the superior benefits of your products. Strong branding can create an emotional connection with customers that’s hard to break.

• Community Building: Build and nurture a community around your brand. Engaged communities can act as a significant barrier to competitors, as members are more likely to remain loyal and advocate for your products.

6. Protect Market Share Through Strategic Partnerships and Alliances

• Form Alliances: Create strategic partnerships that can help expand your market reach, integrate complementary technologies, or block competitor advances.

• Acquisitions: Consider acquiring potential competitors or technology startups that could disrupt the market, integrating their innovations into your product line.

7. Intellectual Property Protection

• Patents and Trademarks: Aggressively protect your intellectual property to prevent competitors from copying your innovations and capitalize on your R&D investments.

8. Pricing Strategies

• Competitive Pricing: Use pricing strategies to make entry difficult for new competitors. This might involve lowering prices strategically, offering superior value, or bundling products to enhance customer retention.

If your org is driving significant benefit from a leadership position in the market -- whether that's a brand that drives an acquisition funnel, operating efficiency from scale or something else, it's reasonable to think about how to maintain that lead.

• Consider carefully why you are in a leadership position versus other customer options (competitors, substitute products etc). Is it unique? Sustainable? Are there small firms that could steal share by, for example, providing a more specialised or concierge solution? Or is there a large firm which could extend into your space, with advantages (like access to funding and time) that you don't have?

• Market leaders, especially large ones, are exposed to the innovator's dilemma. Should you invest in areas that could, if successful, cannibalise your larger business before anyone else does -- protecting your position?

Three dimensions of product investment strategy to consider for market leaders:

• Sustaining your core differentiation for your target customer group 

• Creating an environment to expand customers or use cases 

• Groundwork for strategic disruption

Lets review these three dimensions in detail: 

• Core differentiation for customer engagement and retention:

  • Protect your core product-market fit 

  • Measure new product launches against customer and business engagement KPIs

  • Continue to also review existing feature engagement 

  • Monitor key health metrics on a weekly, monthly cadence (e.g., feature adoption rate, weekly/monthly active users, time spent on the platform, activation rate like free-to-paid, upsell, retention rate etc)

• Customer expansion: 

  • Prioritize expanding within your core customer group with the highest product-market fit

  • Thoughtfully invest in strategic expansion. Some examples include: 

    • Explore the same customer segment in different geographic regions

    • Identify new use cases for your current customer base

    • Consider expanding to new customer groups (e.g., SMB vs. enterprise, different verticals)

• Groundwork for future strategic expansion: 

  • This typically needs to be internally driven because your customers will likely not ask for this 

  • Think of this group as projects you will undertake that could potentially disrupt yourself

  • Example: Netflix transitioning from DVD rentals to streaming, playing offense as a category leader

Based on your company stage, a 70/20/10 type investment structure can guide allocation and prioritization.

To defend your position, work on:

• Strengthen your existing competitive advantage. If you are not very clear on what are the sources of your current competitive advantage, identify them and develop metrics and a way to measure their effectiveness. Your objective is to maintain and grow the competitive advantage that you already have.

• Explore additional sources of advantage. As the business grows and the market evolves there will be opportunities to build more kinds of moats in the product and the business. Research what are the other types of strength that you can build and explore adding them.

• Track your competitors closely, identify their competitive advantages and make sure that you are not trying to compete symmetrically, by building the same ones. The more you differentiate your business and product from your competitors, the harder will be for them to challenge your position.