In the vast majority of cases, to break into any given market, a product must be superior in at least a few meaningful ways to its competition. Innovation and introduction of new features, therefore, is crucial for developing a product that will eventually catch on. However, buyer resistance to loss outweighs buyer reception to potential gain. If a product is too distinct from its established competition, it may not be able to compete due to the simple fact that most people have an aversion to giving up what they already have to begin with. If someone is presented with an even chance to gain or lose something of equal value, their aversion to the potential loss will outweigh their excitement at the potential gain, so the potential gain must be far greater than the potential loss for them to take this opportunity.
Loss aversion in the context of buyer resistance causes buyers to undervalue new products they do not have while overvaluing older products that they already have. A product manager can leverage this concept by ensuring the new product being introduced is not only superior and provides a significant potential gain, but is also marketed as similar enough to the established competition in ways that matter to consumers for the consumers to believe they aren’t losing out on much by switching. This gives the consumer the impression of a potential gain that vastly outweighs the accompanying loss. Similarities can be pushed through marketing, user interface, and features that consumers enjoy in the older products, while the newer features can also be emphasized to push the idea of a strong potential gain.
Feature creep is the excessive addition of features to a product. It can potentially differentiate a product from its competition to the extent that the switch would feel like a great loss to consumers. Product managers can avoid this by focusing solely on addressing the most significant consumer complaints.
