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How to Launch a Product Into a Crowded Market



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We all can’t be disruptors. We all can’t launch completely new products and services the world has never seen before. Most of us sell in crowded markets with lots of competitors.

What’s a crowded market? It’s a market where customers already have a lot of options. It’s usually full of well-established businesses with years of experience serving the same customers. These markets are sometimes called saturated markets because they feel full. If you’re like most entrepreneurs, you’re fighting your way through a crowded market right now.

So how do you launch a product and survive in a market like that? In this article, we’d like to offer a few ways to find success with your products in a crowded market.

Find Your Point of Difference

Just because the market is crowded doesn’t mean you have a license to be unoriginal. The first step (and most obvious) is to find a way to set yourself apart from all the other products in the same market. The difference doesn’t have to be huge, but it needs to be significant enough so people understand it clearly.

What should your difference be? It could be your unique experience or your extraordinary branding. You might add technology to a service that’s typically performed manually, or do manually what is usually performed with software. Maybe you have a controversial approach or ascribe to a different way of thinking.

Whatever you use as your differentiator, put it at the front of your marketing. Potential customers need to see it (and understand it) right away so they separate you from your competitors in their minds.

Niche Down to a Sub-Market

The easiest way to make space for yourself in a crowded market is to focus on a smaller segment of your audience and sell them a targeted product that serves their needs better than anyone else.

For example, let’s say you want to build a software tool for human resource managers. There are lots of those already. But what if you made an HR tool specifically for medical offices? Or for schools? Yes, those are smaller markets (sub-markets, really), but they come with a few advantages:

  • You can solve their problems better than anyone else because you don’t have to worry about pleasing people in other sub-markets.
  • You can charge more because of that better service and because they don’t have many (or any) options that meet their unique needs.
  • It’s cheaper to reach potential customers because you know exactly where they are.

In fact, if you drill deep enough to find a niche, you are bound to find a group of overlooked customers. These are people who want to buy, but for whatever reason have been ignored by the existing market players. Depending on their needs, these customers could be an easy foot in the door for you.

Don’t Discount Second Mover Advantage

First mover advantage is the benefit that comes with being the first player in a particular market. The first mover has a head start on an idea, creates most of the media buzz, and gets to define a lot of the core concepts, like how much a service costs or how it’s delivered.

First mover advantage is powerful, but it’s not the only advantage. Second mover advantage is a useful tool as well because the second mover gets to learn from the first mover’s mistakes.

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Here’s an example: When Uber refused to let customers tip through their app, Lyft quickly added that feature. When Uber drivers complained that they don’t get paid enough, Lyft lowered their take from the ride fees. When Uber was criticized for questionable business practices, Lyft presented itself as the ethical option.

No, Lyft hasn’t surpassed Uber as the ridesharing king, but their second mover advantage has solidified them as the most popular alternative. In fact, there are lots of other ridesharing apps you’ve probably never heard of.

Study the existing players in the market. What mistakes have been made? Where do they leave money on the table? What do their customers complain about? These inefficiencies are places to make space for yourself.

Innovate on the Business Model

If there’s no way to change your product to make it unique, look for ways to innovate on your business model. Sometimes changing how people pay for your product gives them a good reason to switch from their existing provider.

For instance, if your competitors sell one-off products, maybe you could sell the same kind of product on a subscription basis. Or maybe you could give part of it away for free in order to convert people into paying customers. (Software products are known for their freemium models.)

Fiverr is our favorite example of model innovation. When Fiverr launched, it certainly wasn’t the only site to hire gig-based workers. It wasn’t even the only site to buy “micro-gigs.” But Fiverr achieved meteoric success due to its innovative model that changes the way people hire other people for small tasks.

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Instead of letting gig workers and clients negotiate rates, Fiverr sets the price point from the outset ($5) and lets the gig workers design services to meet it. This completely removes the negotiating element from transactions so gig workers and clients can focus on what’s important to them.

At the end of the day, Fiverr’s product is the same as any other freelancing platform. They simply connect freelancers and clients and give them a place to conduct a transaction. But Fiverr found a way to disrupt the industry with an innovative model and compete in a crowded market.

Build on Your Strengths

It’s tempting to compete in a crowded market by doing the same things as everyone else. If their product has ten features, you may want to build those same features into your product too. The logic goes, “If they have more features at the same price, customers will obviously choose their product.”

But that isn’t always the case. Features are rarely the same. It’s fine to release a product with only three features – or even just one! – if you do it well. The customers who really need that feature may be willing to give up the others (or find other solutions for them) if you can show them that your product is the best at that one thing.

If you’re weak at something, it’s almost always a waste of time and resources to raise that deficiency to a competitive level. Instead, focus on your strengths. Iterate on your product’s qualities that make it great until it’s the undisputed best in the market.

Focus on Your Relationships

In a mature, crowded market, it’s easy to get swept up by the high-level strategy, fancy tools, and endless analytics. Your competitors have sophisticated processes and automations. They have teams of people and outsourced vendors. They make big decisions based on granular data. You should do all of that too, right?

No, not always. When you’re trying to make a name for yourself in a crowded market, sometimes it’s easier to focus on people. Speak to one person and convince them to buy. Then speak to another. Then another.

Will you explode into the market with this strategy? No. You won’t be featured across the blogosphere as the next big thing. But if you don’t have the resources to make those kinds of waves, then don’t bother. Instead, make a little ripple and turn it into bigger ripples by investing your energy into your customers.

Most importantly, act like a real human. Don’t try to be the proverbial corporate drone who always placates but never apologies. Take their feedback graciously and give them a reason to trust you. You wouldn’t believe how many people make purchases solely because they like the salesman.

There’s Always Room

Just because a market is crowded doesn’t mean you should give up on your product or business. It may take a little more planning and effort, but it’s entirely possible to make some space and carve some market share for yourself. The principles we outlined above will help you get there.

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