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The Paradox Of Continuous Product Improvement.

For every product innovation, continuous product improvement is all that's left to do after the big innovation has been established.

It’s been over a decade since the introduction of the first generation iPhone in the summer of 2007. That seems like a century ago.

Like all product innovations, the iPhone followed the predictable path all marketers eventually take toward product evolution–a series of incremental improvements to features and functions of the original innovation.

It’s particularly interesting in Apple’s case because the first iPhone was truly a radical product innovation. Nobody was asking for an iPhone, but once realized, people couldn’t live without it. Once established, everything afterwards has been an augmentation to the original.

The iPhone is now ubiquitous. The smart phone category that Apple invented is now a slush pile of brands, features and applications. Smart phones are a commodity and even Apple struggles to maintain is premium price positioning.

The genius of marketers lies in augmentations to known products.

Whether by addition or multiplication, the value proposition of most product innovations just keeps getting bigger and bigger as time rolls on.

To the extent that a product provides a set of “benefits” to the customer, product development and marketing people constantly seek to improve the product by adding or augmenting more features and benefits to the existing product. Or they are multiplying or extending specialized versions of the original product to meet hyper segmented sets of customers with specialized needs.

These line extensions happen in every product category from airlines to dog food.

For brand consultants like me who spend all their time trying to uncover relevant differentiation among competitors in a category, product improvements– either by addition of new features and benefits, or through multiplying product extensions–seems like fastest route to sameness and commoditization.

The bigger the value proposition becomes within the category, the easier it is for customers to become indifferent to all competitors in the category.

This is a vicious cycle (or trap) many marketers easily fall into. Marketers have attained genius level competency in a race to the middle. The process goes something like this:

  • A brand adds to its value proposition by offering a new feature and benefits to customers.

  • Customers are pleased with the addition (like the gazillions of people who bought the iPhoneX).

  • Competitors in the category match or imitate the new proposition.

  • The “new value” becomes the standard across the category.

  • Customer satisfaction is then re-calibrated where they feel entitled to have at a cheaper price what they were previously grateful for at a premium price.

  • The value proposition has expanded increasing the cost of entry for all brands competing in the category.

  • Rinse and repeat.

Once all airlines offered frequent flyer loyalty programs, customers had less reason to care about what brand they remained loyal to. This is a form of marketing mitosis–constant splitting and multiplying features, benefits and extensions. The more things change the less differentiated things become.

At the end of the day, marketers fall victim to the paradox of different – artfully and skillfully packaging and re-purposing incremental product distinctions as product differentiation.

You know you’re in a mature product category when you hear your customers say, “I think I’ll wait till next year when the new version comes out”.


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