Product Parity: What is it and How it Can Hurt Your Product Growth

Product Parity: What is it and How it Can Hurt Your Product Growth cover

What is product parity? Why is it not good for your business? How can product managers avoid building parity products?

If you’re looking for answers to these questions, look no further, because we’ve got you covered!

Are you ready to dig in? Let’s do it!


  • We talk about product parity or brand parity when a brand’s product offers exactly the same functionality as competing products.
  • Product parity should be avoided because such products are unlikely to disrupt the market and never command premium pricing.
  • Product parity also limits your marketing and branding strategies. In fact, the only differentiator you can use to stand out from competing parity products is price.
  • Points of parity are these product characteristics that your product needs to match the functionality of a competing product. They’re necessary to enter the race.
  • However, matching rivals’ features is not enough to win the race. To do that, you need to use different differentiators like better quality, superior customer support, better customization, or greater usability.
  • To differentiate your product successfully, conduct market research, track product usage, and collect feedback to identify user needs.
  • Product-market fit is a good indication of how competitive your product is.
  • An MVP (or MLP) helps you collect real-life data on what your customers need and how to best satisfy them to get the edge in your target market.
  • Before you commit to building new features, validate your ideas with fake door testing and prototyping.
  • Building features that your user asks for may be necessary to stay competitive. However, before you comply with their requests, make sure the feature will serve the majority of your users and not just select a few. Also, check how it fits into your product vision.
  • Instead of simply copying a feature, think of innovative ways to meet the user requirements.
  • If you want to differentiate yourself from competitive parity products through features, focus on developing killer features that give users a unique experience that nobody else can deliver.
  • Curious how Userpilot can help you avoid product parity? Book the demo!

What is product parity?

Product parity is when your product offers the same functionality as your competitors.

Parity products have the same features, solve the same problems and even look the same as rivals.

Even if there are some differences between different parity products, they aren’t relevant to users and won’t sway them towards one or the other.

Product parity definition. Source: AwesomeFinTech
Product parity definition. Source: AwesomeFinTech.

What’s an example parity product? Think about bottled water or mouthwash.

Why you should avoid building parity products

Many brands fall into the parity trap and try to emulate their competitors. After all, what worked for them, should work for you as well, right?

Not quite! Feature parity can cause some serious damage to your brand!

Risk losing competitive advantage

Losing competitive advantage is one downside of product parity. Actually, you will struggle to get any advantage in the first place!

If there’s nothing that differentiates your product from competitors, it’s unlikely to be noticed by potential customers.

Even if you manage to catch their attention, why would they bother to switch from the products they’re already using?

As creatures of habit, we don’t change our ways easily. Because change and the uncertainty that it brings are uncomfortable. It can be quite expensive too.

We’re wired like that, and if your product doesn’t offer unique benefits, it doesn’t stand a chance against established rivals.

Parity products can’t demand premium pricing

Unless your product has some unique selling points, you can’t really charge more than your competitors.

If your product offers exactly the same functionality and solves the same problems as at least one competitor, it can be easily replaced.

If that’s the case, guess what will happen when you raise prices? Your churn rate will soar and as a result, your revenue will take a dive.

The parity product market is driven by price differentiation

Talking of money, the only way parity products can get the edge over other brands is by lowering prices.

What’s more, if your competitor decides to cut their prices, you will have to match them to retain your market share.

Whoever decides to make the first move, will end up in a race to the bottom. To stay competitive, you will have to cut your profit margins or reduce your overheads, and the latter may come at cost of quality. Most businesses would rather not go that way.

Your marketing and branding strategies will be limited

Without nothing but the price to give you the advantage over competitors, your marketing is going to have minimal options.

As we mentioned, lowering prices is pretty much the only option you have to increase the market share. This applies to the existing markets as much as new markets that you may want to expand to.

How to avoid the parity products trap: build your product and marketing strategy on top of differentiation

As we can see, product parity is hardly ever in your brand’s interest, so what can you do to avoid it?

Understand points of parity

Points of parity are all the features your product needs to offer to your customers to enable them to complete their tasks.

For example, if you are in the cloud storage market, your users need to be able to upload and access their files easily from multiple devices via a mobile or web app available on all the major operating systems.

These are the boxes that you absolutely must tick.

If you don’t, you won’t be considered a legitimate competitor – and won’t get any business.

However, if your product offers exactly the same functionality, it doesn’t necessarily mean it’s a parity product. You can still achieve a competitive advantage by enabling users to get their jobs done better or faster, or with less friction.

Focus on true product differentiation

All great products start with a solid product vision.

Look at the long-term goal you would like your product to achieve. Focus on your audience and the pain points your product will address. More importantly, look at the ways your product could solve them in unique ways.

Having a clear vision will allow you to develop a robust strategy to realize it. All the development, marketing, and branding decisions need to be informed by your product vision.

Good product vision helps avoid product parity.

What factors could differentiate your product?

If you are in the SaaS space, you could get the edge through:

  • superior quality and reliability
  • unique features
  • services you provide – like a self-service resource center
  • customization – to give users the bespoke experience they’re after
  • enhanced product design that is accessible and highly usable
  • pricing – and it doesn’t always mean undercutting your competitors

Your marketing team will probably use a combination of these to get the best results.

Understand what different user segments need

While working on your product vision and strategy, make sure you take time to figure out who your target audience is and what their jobs to be done are.

Different user groups use products to achieve different objectives. Without understanding their needs, you won’t be able to provide them with solutions that help them do their work better.

For new products, thorough market and customer research is a must.

If you are refining the differentiation strategy for an existing product, you have the advantage of access to customer data. Tools like Userpilot allow you to track the engagement of different user segments to identify what brings the most value to them.

Once you know that, work on developing that functionality and make sure your users know about it. Use in-app guidance to highlight new features and their benefits.

Event occurrence tracking in Userpilot
Event occurrence tracking in Userpilot.

Ask for feedback from your users

User feedback is another source of invaluable insights into customer needs and you should really be collecting it all time and everywhere.

And with the segmentation and adoption tools available now, you have no excuse not to.

If you’ve released a new feature, make sure you follow it up with an in-app survey that’s triggered when they use it and see how well it satisfies their needs.

If you can see a decrease in daily or monthly active users, send an email survey to the churned users and ask how you can improve the experience to bring them back.

Apart from actively soliciting user feedback, allow them to leave passive feedback whenever they fancy.

NPS or CSAT surveys are quick and convenient but make sure you collect as much qualitative feedback as possible too.

And once the feedback starts coming, act on it! It’s unbelievable how many companies still fail to close the feedback loop and implement improvements based on user input.

Apart from the opportunity to improve their product, they miss the chance to send a powerful message to their users – that they care. This on its own could be a great differentiating factor that could allow your product to stand out.

Collecting user feedback will help you avoid product parity
Collecting user feedback will help you avoid product parity.

Regularly check you still have product-market fit

Product=market fit is the ultimate indication that you’ve built a successful product with the right features for the right market.

But reaching it is just the beginning.

To maintain it, you need to constantly keep your hand on the pulse. Run PMF surveys regularly and track how well you’re doing.

Product Market Fit Survey
Product-Market Fit Survey built with Userpilot.

When you see that users stop appreciating your product, follow up with more in-depth research to identify the causes and start iterating until you get back on the course.

Focus on the minimum viable (MVP) and minimum lovable (MLP) product first

If you’re just starting out, trying to build a functionally equivalent product may not be possible. What’s worse, by copying competitors, you may end up in the feature parity trap.

Copying competitor features leads to product parity
Copying competitor features leads to product parity.

What’s the alternative?

A minimum viable product (MVP) or better yet – a minimum lovable product (MLP) is all you need.

Build a product with enough features to make it interesting to the users. You won’t be able to charge much if anything, but it will allow you to collect data on your users and their needs.

This will allow you to fine-tune your positioning strategy and make informed choices about future development.

Test new features before building

If you think you have an idea for a good feature that will blow your competitors out of the water, it may be tempting to jump right into development. Hold your horses though!

No matter how brilliant an idea may seem, there’s a chance that nobody will actually use it.

To avoid wasting time and money on a feature that nobody will use, take your time to validate the idea first!

How can you do it?

Fake door testing is a cost-effective way to verify the assumptions behind your ideas and test the potential demand.

An imaginary fake door test designed in Userpilot
An imaginary fake door test designed in Userpilot.

To carry out the test, you need to make the user believe that the feature is already available. You can simply add it to the menu and then use your favorite onboarding tool to design a tooltip or a hotspot and bring it to users’ attention.

By tracking how many users click on the new feature, you can decide whether the feature is worth the effort or not.

Of course, you can’t leave your users hanging out there like. You will need a modal explaining that you’re still working on the feature and offering early access once the feature is available.

Don’t forget to ask them to sign up for email updates! You’re going to need beta testers when you finally release the feature.

Don’t build just because users ask

It’s not uncommon for users to get wowed by a competitor’s new shiny feature and they want the same from you.

Building the feature might as well be the best thing you can do. But it might not be.

First, check who is asking. Power users tend to be the most vocal group, but they only stand for 1% of your user population, and what they want may not benefit the majority.

Moe Ali on the 1% trap
Moe Ali on the 1% trap.

Next, check how the requested feature fits into the product vision. Is it going to bring you closer to your overarching goal? If not, scrap it. You can’t solve all the problems in the world.

Finally, look into its functionality and see what needs it satisfies. Are these needs legit? Do your target users share these needs? If not, bin it.

If there’s a genuine gap though, look at a better way of satisfying the need. Instead of playing catch-up with your competitors, find a way to outperform them. And watch them eat your dust!

What are your killer features?

Killer features are those that differentiate your product from your rivals. However, they are not just any features that other products don’t have. It’s the features that improve your value proposition.

Despite what we’ve just discussed, adding features can improve your competitive advantage. You just need to add the right ones.

Phil Fernandez about one of Marketo’s killer features
Phil Fernandez about one of Marketo’s killer features.

Product discovery, user feedback, usage tracking, and rigorous testing of your ideas will help you identify the features that will make a difference – to your business and to your users.

Once you find them, focus on incremental innovation to maintain their relevance and make them even better for your customers.


Product managers should avoid product parity because it limits the marketing and branding options. Instead, they should focus on developing functionality that helps users achieve their objectives better than competing products.

If you’d like to see how Userpilot can help you discover your killer features and avoid product parity, book the demo!

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