April 8, 2019

Should my product have more features than the one of my competitors? Or is it enough if I'm cheaper?

Hey Indie Hackers!

I'm developing right now a simple appointment booking tool for a certain niche. There is one big competitor and other several small competitors.

So basically my plan is to focus on the main functionality of the tool and not add other unnecessary features which are probably going to be used by 10% of my clients.

So I know for example that a big competitor charges a fixed fee of 35% for every appointment booked. So if a customer books an appointment over that platform for 100 dollars , the business owner needs to pay 35 dollars to the big competitor/platform. So thats adds up and surely they will be paying like over 1000 dollars a month, because people book daily over this platform.

The other "small" competitors, charge 30-50 dollars. But to be honest their design doesn't look very user friendly, but the main functionality is there.

I personally would charge around 80-100 Dollars and have the same features, but with better design. I don't know if the other small competitor have a beautiful admin dashboard (the big competitor has a beautiful one). Do you think people would buy from me, because I have a more beautiful design for the customer/admin dashboard(for the business owner) and the same functionality?

And what would you respond, if your client says: Well the option X is cheaper?

Also a general question: Do you need to have more functionality than your competitor or should you be cheaper, if you have less features?

Thanks for taking your time and reading until here. I hope you can give me some advice!

#ask-ih

  1. 4

    Hi Aaron,

    There are a few considerations beyond the price tag; what would be the cost of switching systems to your client? (retraining staff and their clients, downtime, transfer data, etc.)

    Furthermore, there are usual several 'markets'. For instance, instead of focusing on potential clients who are already using the competition, are there potential clients who are underserved? Or is the market diverse, the one size fits all solution of competitors not perfect, and you can focus on carving yourself a niche?

    I would highly recommend 'Jobs to Be Done' by Anthony Ulwick, I read it last year and it was extremely useful in analysing the market and the product features. (Free e-book available on their website. https://jobs-to-be-done-book.com)

    In general, I'm wary of competing purely on price. It can become a race to the bottom and a battlefield where only the largest, better funded players can win. If you can find an angle to be differentiated and charge enough to develop and grow your business you are winning.

    Hope you found this helpful,

    AVB

    1. 1

      Thanks for your answer.

      Well basically my platform, hasn't any publicity. So the business owner (hairdresser) should basically tell the clients to book over the new platform and not the old one. He wouldn't be able to gain new customers on this platform, until it gets more publicity.

      I don't think I can really pick a niche. Because it's a local appointment booking software. So basically it's about hairdresser's. I mean there isn't really a big difference between the gender's or hair types. It's basically seeing the public calendar of a hairdresser and then choosing your time.

      What do you think about a freemium model? If the business owner books maybe about 35 appointments or more per week a paywall will pop up and then he needs to pay a monthly subscription? I mean it's kind of spotify like.

  2. 2

    If you really want to smash your competitors make it completely free and find a different monetization model. Selling the extra features as a small subscription per feature?

    Free vs a 30% cut will make people choose you every time. The advantage you have as a solo dev is that you can do stuff big companies can't.

    1. 1

      Yeah, I think I'm gonna go with a freemium model, and then ask for a payment, if the business owner exceeds a certain limit of weekly bookings. What do you think about that?

  3. 1

    When I read your approach. You are leaning to something (features, price) that will automatically sell your product. I hate to tell you this. NOTHING will work.

    Learn how to sell! Bottom line.

    1. 1

      This comment was deleted 5 months ago.

  4. 1

    Pricing is a factor, but if you do not otherwise differentiate yourself with a key feature or two, you aren't going to get very far. The more entrenched the competitor the more no's you have to overcome.

    As others have mentioned, switch costs matter.

    Anyone heavily invested in the other technology is going to be against you.

    Just one other competitor (and you mentioned others than the big one) with an additional feature that serves a vertical and better marketing is going to beat you.

    1. 1

      Hmm. I know what you mean. But what would you do, if the service is about an appointment booking software for hairdresser's. I mean what type of features could I implement additionally?

      1. 1

        If you want to make it about hair or the 'beauty industry' then you need to get neck deep in what that's all about. That could mean selecting various options at the time of booking so that it calculates time it takes to do X, Y, Z (for those getting their hair done during a limited amount of time) or something similar.

        Some also want to set appointments with specific stylists that work at the same location.

        Also consider the scope of the customer - needs of a shop of 3 vs ship of 12 stylists, etc.

  5. 1

    Hi Aaron, I suggest you set your price less than your competitor if you are planning to penetrate the market.

    Provide them extraordinary features, better than the big giant at less cost. I know you will be in loss for a couple of years, but when you see a bigger picture you are in a win-win situation. A client will trust you as a brand,and once that happen, you can charge high on other product or on value added features. The problem is to get in.

    1. 1

      Yeah, I think I'm gonna go with a freemium model, and then ask for a payment, if the business owner exceeds a certain limit of weekly bookings. What do you think about that?

      But what would you do, if the service is about an appointment booking software for hairdresser's. I mean what type of features could I implement additionally?

  6. 1

    Do you receive and hold the money from customer end, then distribute back to merchant? If I am the merchant who is considering looking for a booking site, I would first consider it's credibility (because you take care of their money) of a platform, therefore, usually big platform wins in this case (they want their money back!).

    From end customer point of view, I would say the main reason to use your platform is you have the good services or products that offer by your merchant, not just the platform itself.

    1. 1

      It's basically an appointment booking software for hairdressers. I do not receive the money directly. The big competitor for example, wants 35% of the service price paid by the business owner. The platform doesn't hold any money.

      I would basically solve the problem, that somebody needs to pick up the phone and have these conversations about which time slot is free, what kind of service etc.