Entrepreneurs need to spend a lot of time explaining to the world how their offering is fundamentally different. Cosmetic changes to products that are already in the market don’t cut it anymore. Explaining your product in terms of another market leading product just isn’t exciting. For example, a dating app that is simpler to use than Tinder, or a taxi aggregator that is faster than Uber—that’s a hard sell. That is why innovative startups aspire to define a new class of offerings. To wow the market, the product needs to be positioned as a pioneer in a completely new—albeit small and growing—category. Over time, as the category gets legitimized, so does your product.
As entrepreneurship involves the pursuit of opportunities that are seemingly beyond one’s resources, it challenges you to something that hasn’t been done before. Entre
preneurship is often about solving a problem in a manner that is faster, cleverer, cheaper, or maybe more fun than currently available solutions. Therefore, the element of ‘standing out’ is crucial.
In his best-selling book, Zero to One, Peter Thiel talks about ‘The Founder’s Paradox.’ Thiel explains how some of the world’s most famous personalities—including Howard Hughes, Steve Jobs, and Lady Gaga—have all displayed a certain eccentricity, that X factor, that has helped make them truly distinctive. And while Thiel wonders if they were born with it or merely cultivated it as a way to stand out, he also talks of their need to eventually fit in in order to gain legitimacy.
Once you’re done with successfully differentiating your offering, you are faced with an even tougher challenge. How do you convince your customers that your offering is relevant to them and addresses their pain points?
Like I had written in an earlier blog, if you want to convince people that your idea is indeed a great one, you need to present it to them based on their frame of reference. This is where the ‘fitting in’ part comes in. You need to put yourself in your customers’ shoes, understand their world-view and appreciate their problems as you articulate your value proposition.
For most innovative companies, the positioning journey starts from emphasizing what makes your offering different. Standing out is what gets you the attention, but it also generates resistance. So, once you’ve defined the product and identified your differentiator, then you need to try to fit it in.
What happens when you fit in too much? There is a flip side to that as well. Innovation often comes from the ability to look at situations through a completely different lens. A quote from Thiel’s book reminds us of the balancing act: The single greatest danger for a founder is to become so certain of his own myth that he loses his mind. But an equally insidious danger for every business is to lose all sense of myth and mistake disenchantment for wisdom.
Seeing the world too much from your customer’s viewpoint puts you in danger of losing the unique outsider perspective that you enjoy. Therefore, a balance between fitting in and standing out is crucial.
To elaborate with an example, an enterprise software firm must ensure that their products work smoothly with existing enterprise products. Customers often demand that new products seamlessly integrate it into their existing infrastructure.
But here’s something interesting to consider. The more differentiated and useful the new offering, the more the vendor will be comfortable with integrating it into the existing ecosystem. The less differentiated the product, the more likely the firm is to offer an ‘end-to-end’ solution. Such solutions include several me-too features that competitors already offer. If the offering is indeed useful and differentiated, then the focus will be on getting more customers rather than making more money from fewer customers.
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‘Fitting in’ and ‘standing out’ may be at odds with each other, but they are both necessary: To be truly successful, founders must master how to fit in as they stand out. The question isn’t whether to fit in or to stand out. It is how to do both.
