- GILT, changed PRICE but didn’t change product, and opened a niche for discounted designer clothes.
- Phones International, changed the DISTRIBUTION MODEL of the mobile phone industry but it didn’t change the product (cell phones), and opened a niche for ‘single brand distribution.
- The Book People, changed the TARGET CUSTOMERS, but didn’t change the product (books), and opened a niche selling books to corporate clients.
- Adwords, changed the BUSINESS MODEL, but didn’t change the product (display ads), and opened a niche for ‘performance advertising’.
These are significant differences that not only differentiate the companies from all the others, but disrupted the market in some way.
What other variables can you change in a business in this way?
How are these variables called?
Where can I learn more about this?
A perfect example of a company that did this successfully is Zappos. They differentiate with customer service, not the products themselves. If it were all about products, then Amazon (who bought Zappos for this very reason) would have a larger collection.
Zappos is now synonymous with customer service. Everyone looks at them for direction on this concept alone. Even non-competitors.
Another example is Google Chrome. Google differentiated its browser from Firefox by focusing on speed. Now, everyone is playing catch up.
On top of the business model canvas, we can further visualize angles with the Innovation Radar tool:
So much of innovation is about focusing on an attribute or feature no one else is exploring. Focus on that, and make it matter.
What do you think, how else can a business differentiate without changing the product itself?