Are you a SaaS product manager in search of product differentiation examples to inspire your differentiation strategy?
In this article, we’ll explore the types of product differentiation strategies and go over cases of real-world brands that have used these strategies to drive product growth.
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Overview of product differentiation examples
- Product differentiation is the process of making your products stand out by leveraging their unique qualities.
- This process grants you a competitive advantage and fosters brand loyalty.
- There are three types of product differentiation. Horizontal differentiation focuses on subjective qualities; vertical differentiation focuses on objective qualities; and, mixed differentiation combines both.
Some product differentiation examples to guide your approach include:
- Userpilot differentiates itself through its comprehensive feature suite.
- UserGuiding differentiates itself through affordable pricing.
- Dock gets a competitive advantage by focusing on a specific market segment.
- ClickUp achieves product differentiation through customization.
- Hopstack’s differentiator is its exceptional user experience.
- Drip uses its numerous integrations as a differentiating factor.
- Marketo gains a competitive advantage by offering a unique functionality.
- Ahrefs creates extensive documentation on its use cases as a differentiation tactic.
- HubSpot prides itself on its exceptional customer service.
- Apple differentiates itself through brand image and reputation.
Book a demo to learn how Userpilot can help you differentiate your product through personalized experiences.
What is product differentiation?
Product differentiation is the process of making your product stand out from its competitors.
It is a marketing strategy that creates a competitive advantage for your product by highlighting its unique qualities.
Why is product differentiation important?
In today’s ultra-competitive business climate, product differentiation is crucial for your brand’s survival.
Product differentiation cuts out the noise by highlighting your strengths. By offering something unique and valuable, you carve out a niche for your brand and attract customers looking for just what you’re selling.
A strong product differentiation strategy also fosters brand loyalty. With customers already viewing your product as different, any positive experience will reinforce this view and keep them coming for more.
Types of product differentiation
There are three main types of product differentiation, including:
- Horizontal differentiation: Horizontal differentiation focuses on appealing to a customer’s personal preference. This is typically true for products at similar price points and quality levels. For example, Whole Foods aims to stand out with its unique customer experience.
- Vertical differentiation: Vertical differentiation strategies focus on measurable attributes like price and quality. For example, a brand may position itself as affordable (lower quality, lower price), while another is positioned as luxury (higher quality, higher price).
- Mixed differentiation: Most brands operate a mixed differentiation strategy that combines vertical and horizontal differentiation strategies. It includes objective factors (price and quality) and personal preferences (style, taste, etc.).
10 Product differentiation examples to inspire your strategy
Product differentiation strategies have been used successfully by different SaaS brands.
Let’s consider a few examples:
1. Userpilot differentiates itself through its comprehensive feature suite
Userpilot is a digital adoption tool with three feature layers: user sentiment, user engagement, and product analytics. This comprehensive feature suite sets it apart from its competitors.
For example, Pendo (another digital adoption platform) doesn’t have a dedicated feedback layer. Whereas its polls are tied to user guides, Userpilot allows the creation of surveys anywhere in your product.
Userpilot also competes favorably with dedicated tools in each of its three layers. For example, it competes with specialized analytics tools like Amplitude and Mixpanel, and dedicated survey tools like SurveyMonkey and Usersnap.
Thus, Userpilot differentiates itself from other specialized tools by being an all-in-one solution that customers can seamlessly build.
2. UserGuiding differentiates itself through affordable pricing
UserGuiding is a user onboarding tool that empowers SaaS companies to engage users through interactive guides, checklists, and other in-app messages.
To stand out in this competitive market, UserGuiding positions itself as a cheap solution with basic functionalities. Its starting price of $89/month is the cheapest on the market.
Despite its inherent limitations (such as the branding of UI elements with the UserGuiding logo), the low price point attracts small businesses and startups that are just starting out with user onboarding.
3. Dock gets a competitive advantage by focusing on a specific market segment
Dock is a collaborative workspace for leads and customers. This customer collaboration tool makes it easy to set up digital sales rooms, client portals, and project hubs.
Dock understood that for less established brands with a broad target market like them, differentiating the product can be challenging. Therefore, it would be wise to concentrate on one or two customer segments with the greatest pain points the solution can address.
Initially, Dock used overly broad messaging to target the larger B2B market. Then, the product team realized that individuals in sales and onboarding faced the most difficulties in collaborating with customers, and there weren’t specific tools available for them to manage projects with customers.
Therefore, the product’s focus and messaging were narrowed specifically for sales and onboarding scenarios, which proved to be a huge success.
4. ClickUp achieves product differentiation through customization
ClickUp is a robust project management and collaboration tool for coordinating tasks, creating collaborative documents, and tracking team goals.
With several competing products in the market (Jira, Trello, Asana, Notion, etc.), ClickUp chose to differentiate its product through its extensive customization options.
The platform allows users to customize their dashboard UI by adding/removing elements, depending on the project they’re working on. Users have complete control over their interface, which makes ClickUp the preferred tool of many.
5. Hopstack’s differentiator is its exceptional user experience
Hopstack is an AI-powered warehouse management platform that helps warehouse managers automate, digitize, and optimize their operations.
For Hopstack, its product differentiation strategy is less about churning out innovative product lines and more about fulfilling the unique needs of the target audience.
To that end, they set about creating a platform with an intuitive user interface that is really easy to use. They also offer detailed onboarding and personalized assistance to ensure customers can maximize their use.
6. Drip uses its numerous integrations as a differentiating factor
Drip is a CRM solution used for creating automated email marketing campaigns. These campaigns send targeted email sequences that nurture leads, build relationships, and boost sales.
With several products already in the email automation space, Drip set about differentiating itself via integrations. They integrate with over 150 different apps and prominently display all their integrations.
By offering as many relevant integrations as possible and making them easy to find, Drip has positioned itself to capture the flood of users who want to combine email automation with other product data for integrated marketing campaigns.
7. Marketo gains a competitive advantage by offering a unique functionality
Marketo is a robust marketing automation platform that enables you to streamline, automate, and track marketing workflows.
To gain a competitive advantage during its early days, Marketo worked on a single unique functionality at the time – integrating Salesforce and synchronizing its data with theirs.
This made sense for Marketo as the feature delivered exceptional value for their customers. By integrating with a popular CRM tool, they made marketing automation a lot more attractive for a large market segment.
8. Ahrefs creates extensive documentation on its use cases as a differentiation tactic
Ahrefs is a popular search engine optimization (SEO) tool that helps users with keyword research, backlink monitoring, competitor analysis, and more.
Early on, Ahrefs set about gaining an advantage through extensive SEO education.
They created lots of valuable materials on the use cases of their software, including case studies, blog posts, product documentation, video tutorials, and webinars.
9. HubSpot prides itself in its exceptional customer service
HubSpot is one of the most popular and memorable SaaS solutions in the world. Its robust platform contains marketing, sales, website-building, operations, and customer service tools.
Despite its extensive toolset, HubSpot is famous for its readiness to share useful marketing insights with the public.
Hubspot provides tons of useful resources in the form of educative blogs, free ebooks, templates, and certifications, effectively establishing itself as an industry authority and a go-to resource for all things marketing.
For many professionals, Hubspot is the first marketing tool that comes to mind when they need one, thanks to the value it delivers through education.
10. Apple differentiates itself through brand image and reputation
The tech giant Apple provides a masterclass in using brand image and reputation as a powerful differentiator. Apple has cultivated an image as a constantly innovative brand.
Their products are known to be aesthetically pleasing, intuitive, and user-friendly. They position themselves as a premium brand and portray their products as tools for self-expression, creativity, and empowerment.
The result is an impeccable brand image and reputation that allows them to command premium prices. They’ve also gained a loyal customer base willing to wait in line for the next expensive Apple product.
How to create a product differentiation strategy for your brand
After considering the different product differentiation examples above, you may wonder which strategy would be best for your business. Surely, you can’t copy them all, so where do you begin?
Consider a step-by-step approach:
- Study your market: To stand out in a crowded market, you must study your competition. Which SaaS companies are selling similar products? What are their key features and marketing strategies? Which market demographic do they serve?
- Identify opportunities: You can quickly identify opportunities by talking to your customers. What underlying issues and pain points do they have? How can you help? As with step 1, your goal here is to determine the gap (the unique hole) your product can fill.
- Brainstorm your strategy: Create a team to study the data from steps 1 and 2, and brainstorm a fitting differentiation strategy. They can start by taking stock of the product’s benefits and values and assessing how it competes in the market.
- Align your organization around your strategy: Once you’ve settled on a differentiation strategy (market, value, features, etc.), make a point of aligning your teams. Your product, marketing, and sales teams should all work together to define your messaging, strategies, and product planning efforts.
- Track, analyze, and optimize: With your strategy established, it’s time to see if it’s working. Define your target KPIs/OKRs, track all relevant data and metrics, and measure your success levels. As you do, you’ll certainly find new ways to optimize your strategy for even more success.
Conclusion
In a market with more options than ever before, product differentiation is crucial to your success.
The product differentiation examples presented here should get you started on ideas that communicate your unique value proposition successfully.
If you would like to see how Userpilot can help you stand out with your in-app experience, book a demo now.
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