Instead of copying what top competitors do well, analyze what they do poorly or neglect. Excelling in those specific areas creates a powerful differentiator. This is how Eleven Madison Park focused on rivals' bad coffee service to become the world's #1 restaurant.

Related Insights

A powerful heuristic for innovation is to use your own irritation as a guide. Jerry Seinfeld, annoyed by the formulaic nature of talk shows, created "Comedians in Cars Getting Coffee" as its direct opposite. By identifying friction points in existing products, you can find fertile ground for creating something better.

A powerful innovation technique is "humanization": benchmarking your product against the ideal human experience, not a competitor's feature set. This raises the bar for excellence and surfaces opportunities for deep delight, like Google Meet's hand-raise feature mimicking in-person meetings.

Established industries often operate like cartels with unwritten rules, such as avoiding aggressive marketing. New entrants gain a significant edge by deliberately violating these norms, forcing incumbents to react to a game they don't want to play. This creates differentiation beyond the core product or service.

Startups often fail by making a slightly better version of an incumbent's product. This is a losing strategy because the incumbent can easily adapt. The key is to build something so fundamentally different in structure that competitors have a very hard time copying it, ensuring a durable advantage.

When facing massive incumbents, avoid the trap of creating a slightly better version of their product. Instead, focus on being fundamentally different. Gamma chose to break the 16x9 slide paradigm that PowerPoint established, creating new primitives for visual communication.

Instead of comparing to competitors, compare your product to the ideal human interaction. Google Meet aimed to be like a real conversation, not just better than Zoom. This 'humanization' framework pushes teams to think beyond features and focus on a more intuitive, emotionally resonant experience.

Instead of imitating successful competitors' tactics, deconstruct them to understand the underlying psychological principle (e.g., scarcity, social proof). This allows for authentic adaptation to your specific context, avoiding the high risk of failure from blind copying which ignores differences in brand and audience.

In a crowded market, the most critical question for a founder is not "what's the idea?" but "why am I so lucky to have this insight?" You must identify your unique advantage—your "alpha"—that allows you to see something others don't. Without this, you're just another smart person trying things.

In the advertising-heavy personal injury law market, John Morgan’s firm wins by being exceptional at trying cases. He claims 95% of competitors are marketers who can't win in court and must settle for less. His firm’s reputation for securing massive verdicts allows them to reject low offers and achieve superior results and margins.

Adman Claude Hopkins turned Schlitz beer from fifth to first in market share by simply telling the story of their brewing process. Even though the process was standard, no one else was telling it. This highlights that "boring" operational details can be compelling marketing differentiators.