How a product or service delivers desired results for users.
Factor (feature, benefit, process…) that makes a product different from its competitors.
For customers, the unique mechanism is what makes them choose a product or service over its competitors.
Mechanism & Market sophistication go hand in hand
How well-aware customers are of the product your sell - in relation to competitors who also offer the same or similar products.
You sell differently based on the level of the market's exposure and understanding about your product.
The 4 levels of market sophistication & what to do at each level
Level 1: When your product is completely new, first in market.
- Customers have never seen anything like your product before. There are no competitors.
- Level 1 comes around once in a blue moon, especially in the highly oversaturated SaaS space.
What to do:
At this stage, make a direct claim. You only need to be put your product out there and people will adopt it.
”This is what we do." or "The world's first and only…"
Level 2: When you start to have competitors who offer the same thing.
- Customers now have alternatives to choose from.
- You need to differentiate yourself to stand out.
What to do:
Extent your original claim with your most powerful features. The point here is to provide users with useful information about your product.
”This is what we do. We do it by..."
Level 3: When competitors start to make bigger claims to outbid you.
- Customers now have the ability to compare between products.
- Most SaaS are competing at this level of market sophistication.
What to do:
Introduce a mechanism = How your product works to deliver results.
Do that by: Add elements that prove your product is better.
- Specific features if you manage to sniff out features competitors aren't advertising
- Pile of features if you have more features than competitors
- Offerings if your pricing is cheaper, you have discounts, LTDs, related resources.
- Promises about efficiency, x time faster, x time success rate, etc
It's tempting to want to upstage competitors. But your mechanism needs to be truthful, only advertise what you can deliver. Trying to counter by making even bigger claims will just make you sound scammy and ridiculous. You will just risk user's trust, degrade your business, or even violating regulations.
It's better to move to level 4.
Level 4: When the market is overly crowded. Competitors have mechanisms too, probably similar to yours.
- Users now are well aware of your product, competitor's products, the general technique of these products.
- Talking about your product won't work anymore, as everyone would be saying the same thing.
What to do:
Shift emphasis from showing off your product to identifying with users. Now it's all about storytelling.
- Appeal to emotions, senses and perspectives.
- The point here is to move past the phase of "getting things done", now it's about "getting things done delightfully", "serving a bigger purpose" or "believing in a vision".
Some ideas you can start with:
- Your business supports the greater good, makes social impacts.
- Novelty: sell your vision, why you do what you do, what changes you're trying to make.
- A unique approach to problems, advanced technology, unique processes.
- Sense of belonging to something bigger: a community.
Example of a SaaS unique mechanism through levels of market sophistication
That’s going at it bottom up, what if we go at top down? You get a persuasive outline for your landing page.
Follow these steps to define your mechanism
- Research. Knowing your industry is not enough anymore. You need to know the level of market sophistication your industry is at, so you can choose the right mechanism to communicate with customers.
- Know what you sell down to the T. Analyze your business, your product to discover all possible mechanisms at each level.
- List your top 5 competitors, discover their mechanisms. If you have similar mechanisms, better not to use those.
- Based on the level of market sophistication, focus on mechanisms which fit that stage or higher.
- You can have multiple mechanisms. Test them out, see which works best and push for that one.
If you have questions or any problems findng a mechanism for your SaaS, DM me on Twitter. I'll be helping you out :)
Onto the next one,
Obvs is a free newsletter and free community. We make Obvs to uplift go-getters who seek ways to succeed at building their own things.
Got feedback so I can do better? DM me on Twitter.