There are two basic ways of competing.
The first is to create a better version of a product in an existing category – you want to win brand preference.
The second is to create a new category and make any competitors irrelevant.
I expect an interesting debate but this does echo thoughts from the Blue Ocean Strategy although I understand that there is stronger emphasis on brand building.
One way to create brand relevance and form a new category is to create a tighter focused strategy towards a narrower group of customers. It has that “just for me” appeal that creates a preference.
Another is to innovate across categories like the Cirque du Soleil example covered in Blue Ocean Strategy or the way the Smart-phones have added extra portable functionality to the mobile phone (look at the impact that the iPhone from Apple has had on Nokia).
Paul Simister is a business strategy coach who helps small business owners to profit from differentiating their businesses, being distinctive in the eyes of their customers and standing out in a crowded marketplace.