Competitors in New Product Categories

When I worked at a research lab early in my career - we worked on crazy things, far out things. Things that we couldn’t imagine or only had a faint glimmer of implementing.

I was a bit more realistic about my work - yet, some of the things I worked on showed up outside of the lab done by other companies twenty years later.

At the time, I knew it would fail. Twenty years later, it still hasn’t caught on.

The idea of working at a research lab is to create new product categories for the company to own. Being first to market and owning the market is always the dream.

This never works out - or hasn’t worked out from what I have seen.

Competition is Good

One of the key reasons for this - for a new product category to succeed, there needs to be at least two competitors.

With two competitors fighting it out - they take the product more broadly to the consumer. Either with messaging, marketing, different applications, pricing, etc.

If a single company creates a new product category - they would never spend more effort on messaging, marketing, different applications, etc. They would expect to just own the market because they were there first.

Hence, a competitor to tease out and expand the product category not only for themselves - for the public.

Public Good

The public needs this broader range of messaging and product diversity within the new category from competitors to understand the difference.

At the same time - having two different companies that feel this new product category is a great idea is essential.

“This is Revolutionary”

When I hear about something “revolutionary” - I always ask: “Who else is in this space?” If there’s no one else, there’s a smell. There’s no other company that feels this is a great idea.

With another company - then it gets interesting: “What’s their approach compared to yours?”

Always look for another company to counter the first mover in a new product category.

Only then, will the product category start to sprout.