What are some common mistakes that companies make when trying to differentiate their products from competitors?

The biggest mistake is to focus on what the competitor does versus what the customer cares about. Don't start with what the competition is doing or not doing, start with what specific customer needs are not being met by the current players, and find better ways to serve them.

Another common issue is to be too reactive to the competition and following competitors into whatever new shiny thing they believe will give them an edge. Again, looking at what the customer wants and why they want it will give you a better competitive edge. A great way to do this is by using a jobs-to-be-done framework to identify current and future market needs.

Finally, many companies try to be the best in all markets for all customers and look at their competition as "every company that does X". If you try to be the solution for everyone, you end up being good at nothing... focus on a particular market with specific players and find your edge there, before venturing elsewhere.

1. Lack of deep understanding of the target audience: Differentiation should be based on a thorough understanding of the target audience's needs, preferences, and pain points. Like everything in product marketing- it should start with your customer. Building parody features or postioning to copycat a competitor is a fast road to a dead end.

2. Neglecting to communicate the value proposition clearly: Even if a product has distinctive features or benefits, failing to communicate them clearly to the target audience can lead to missed opportunities. Invest in strong messaging and marketing efforts to effectively convey the unique value proposition to customers, ensuring they understand how the product differs from competitors.

3. Inadequate market research and competitive analysis: Insufficient research and analysis can lead to an incomplete understanding of the competitive landscape. Without a deep understanding of what competitors are offering, how they position themselves, and the changing market dynamics, it becomes challenging to identify and execute effective differentiation strategies.

4. Focusing solely on product features rather than holistic customer experience: While product features play a role in differentiation, focusing solely on them may overlook the importance of delivering a holistic customer experience. Companies should consider factors such as customer support, ease of use, brand reputation, and emotional connection to create a differentiated experience that sets them apart from competitors.

5. Ignoring evolving customer needs and market trends: Markets and customer preferences are dynamic, and failing to adapt and stay ahead of changing trends can hinder differentiation efforts. Companies should continually monitor customer needs, market trends, and emerging technologies to identify new opportunities for differentiation and ensure their product remains relevant.

6. Lack of consistency across the entire customer journey: Differentiation should extend beyond the product itself to encompass the entire customer journey. Inconsistencies in branding, messaging, customer support, or user experience at different touchpoints can dilute the intended differentiation. Ensuring a consistent and cohesive experience throughout the customer journey strengthens differentiation efforts.

The biggest mistake I have seen marketing teams make when trying to differentiate their products from competitors is to "differentiate" by renaming industry-accepted terms and capabilities for the sake of being different vs. showcasing what is that you offer, how are you different, and why that should matter to customers.

Another mistake I have seen many companies make is to believe a feature list comparison on a website suffices to claim you are different vs. a key competitor. Most customers do not purchase software or product for their features but rather for the experience and capabilities it offers.

I think everyone forgets about "status quo" and "no solution" competitors. These two more often than not - make up the vast majority of whitespace / addressable market for a company. We get excited by stories - which are told by our competitors. The problem is they are distracting to us and our market. Focus on the people who are doing things the old way or have not yet made up their mind. Convince them by focusing on why YOU win. What makes you different. What are the 5 things your product does better than anyone else. Not what you do compared to others in a feature by feature comparison. Ultimately what's best for a customer is unique, personal and not tangible. People buy from people they like - and competition can get ugly if approached with bias and FUD. Resist the low blows too - that is JV stuff and no one is here for that.

The BIGGEST mistake companies make with positioning is not including the entire company in the exercise and making it just a marketing exercise. The next mistake I’ve seen is not talking to customers and keeping the positioning discussion internal.