How the Best Companies Design Experiences to Destroy Competition

What’s happened in the last few years is pretty clear: It’s no longer a competitive advantage to just build a better product.

You have two options to compete in 2018:

  1. Build something truly remarkable that is also the first of its kind. *(e.g. Soylent didn’t build a better tasting shake. They built something that replaced your entire breakfast + coffee in a bottle.)*

  2. Design an experience that adds value to your core product.* (e.g. Amazon’s $1B acquisition of Ring which allows Amazon to deliver packages inside your home, or Google’s acquisition of Nest which allows them to sell usage data to electric companies.)*

Let’s talk about the second option: Experience design.

Think about how you interact with Amazon:

  1. 1-click purchase on any device (Mobile / Web / Tablet).

  2. Order anything with your voice and Amazon will even recommend which products to purchase (prioritizing Amazon products of course).

  3. Buy online, return in store. Bought something big and need to return it but don’t have the box? No worries, just return it to a local Kohl’s and they’ll take care of it for you at no charge.

  4. Press a physical button to re-order household products. Need more detergent? Press a physical button that’s a magnet on your washing machine.

  5. Free 2 day delivery with an Amazon Prime subscription.

    1. Which not-coincidentally gives you access to free premium content.
  6. Deliver packages INSIDE your house (upcoming as part of Ring acquisition).

_Amazon didn’t just build a better website and mobile app, they built a better experience. And with over 100M prime subscribers, they built an amazing moat. _

The best companies don’t just build great products. They build experiences around their core product (Which results in way more $$$)

Apple is on track to make more money from their services than they do selling their phones, which is remarkable and a huge indication of where other hardware manufacturers are heading.

The services category includes iTunes, the App Store, Apple Music, iCloud, Apple Pay, and AppleCare.

Now, these services are worthless if Apple doesn’t sell their devices. And that’s why companies should think about their trojan horse.

It’s also not a surprise that AMC now offers a movie subscription pass so customers can go to 3 movies a week for one flat fee.

Hardware is a trojan horse to building a better experience for your customers

Let’s say you are a company who sells traditional and "smart" charcoal grills.

You sell great grills and have been for the past 30 years. No one is going to come up with a better charcoal grill than you. You have that locked down, or do you?

In the past, you owned the market because no competitors could compete with your brand awareness and quality of charcoal grills, but now things have changed.

You now have to worry about two things:

  1. What if someone creates a completely new way to grill food? (Like Soylent did with breakfast.)

  2. What if someone creates an average grill but builds an amazing experience around it which locks customers into using their grill & services.

Creating a "smart grill" is a given and shouldn't be a shock. The next question is, “How do I use this data collecting, internet connected smart grill to build a better experience.

Here are examples of how you can build an experience around charcoal grills and generate subsequent revenue from your services.

Let’s break down the different stages of a grill owner and some ideas of how we can build an experience and subsequently build revenue from your services.

The best companies offer utility (Even if you’re not their customer)

A great example of this is the company Peloton. Their core business: Spin bikes.

They released a new app for customers and non-customers .

Peloton doesn't want consumers to just think of bikes and treadmills when they hear its name. It wants them to think walking, yoga, strength training and basically every other fitness word they can come up with.

Utility. The best companies recognize that they offer utility in addition to their core product.

So, let’s go back to the charcoal grill example. Here is how they can provide more utility.

  1. Researching / Buying

    1. Rental service that allows you to rent multiple massive charcoal, or propane, or elegrills for cookouts.

      1. Could bundle certified grill masters to cook for your cook-out.

      2. Partner with propane companies who can be a distribution partner.

    2. Use Augmented Reality to help customers visualize where the grill will fit outside their house.

    3. Use VR to "experience" everything a grill has to offer close-up.

  2. Buying ingredients to grill

    1. Suggest grilling recipes and deliver all ingredients on-demand with a local delivery partner.

      1. You can bundle other accessories & a subscription service to charcoal / wood chips.

      2. Press a button and get charcoal delivered straight to you.

      3. Also, in tandem with renting grills, bundling everything as part of the package could make an amazing experience for someone who wouldn’t normally interact with your brand.

    2. Auto-send propane tanks when gas is detected to be low. [This exists]

  3. Cooking

    1. A subscription service to help people cook better. Can include an on-demand video chat with grilling experts while you’re grilling.

    2. A smart grill or thermometer that helps you cook to the right temperature every time. (Many grill companies offer this already.)

  4. Maintenance

    1. Ability to "trade-up" with other grill owners via a simple-to-use interface. Similar to how grills are purchased.

      1. You can charge maintenance contracts similar to how phones are purchased.

      2. Instead of a one-off purchase, you can charge $9.99 per month with the ability to upgrade your grill.

The best companies build rapid prototypes to test out the market and get internal buy-in

What I’ve seen personally is that our clients openness to trying new services related to their core product has grown substantially. Similar to how companies approached mobile in 2009, with only one foot in the water, they are taking the same approach with new services and experiences around their core product.

The difference is this time, the best companies expect that their first version isn’t going to be the best, but they will learn and iterate. Rapid prototyping is at the core of how companies are pushing out innovation.

I truly believe we are in the infancy of experience design, and I believe rapid prototyping should be at the core of any company pushing new experiences.

The realization is that it’s not about building a smarter product. It’s about building a great product, with a great experience that can be the basis of a new revenue stream.

The goal is to either build a transformative product, or build an experience around your core products. I don’t think any idea is outrageous and deserves to be tested.