Differentiation vs Table Stakes
Balance the roadmap between what attracts new customers and what they require to switch at all
- Difficulty
- Easy
- Time to result
- ~weeks to results
- Steps
- 3
- Confidence
- 93%
A deliberately simplified version of the Kano model for auditing a product roadmap. Every feature falls into one of two buckets: differentiation (what's different and better in ways customers actually care about — the attraction) or table stakes (the boring entry-requirement features you need just to play the game). The framework forces you to ask, for each roadmap item, which one it is and which matters more to customers right now.
Origin
Paul Adams of Intercom credits this as a crazy-simple distillation of the Kano model, developed from Intercom's own repeated mistake of over-indexing on differentiation while lacking basic reports and permissions customers needed to switch.
Core principles
- 01Two forces drive adoption: attraction of the new solution (differentiation) and the entry requirement to play (table stakes).
- 02Differentiation only counts if it's better in ways customers care about — being novel in ways nobody values (e.g. Google Wave) is worthless.
- 03Table stakes features are boring, basic, easy to ignore and easy to skip — which is exactly why they get neglected.
- 04A startup entering an established category must over-invest in differentiation because it can't match decades of incumbent table stakes; balance shifts toward table stakes as you mature.
- 05Judge roadmap items by what matters to customers, not to you.
How to run it
- 1
Classify every roadmap item
Sort each proposed feature into differentiation (attracts, is better in ways customers care about) or table stakes (basic entry requirement to be considered at all).
Pro tip For differentiation, add the test: is this better in a way customers actually care about? If not, it's vanity.
Watch out Teams from design/craft backgrounds are naturally pulled toward differentiation and under-build the boring table stakes.
- 2
Ask which matters more to customers right now
Look at the whole roadmap and ask which of these things matters more — not to you, but to your customers at this moment.
- 3
Set the mix by company stage
As a startup in an established category, weight heavily toward differentiation (customers will buy you alongside incumbents). As you mature, build table stakes so customers can fully switch and rip out the incumbent.
Pro tip Intercom ran as high as 70/30 in either direction over a year or two, settling near 50/50 at scale.
Watch out Without enough table stakes, customers love you but literally cannot switch — they can only add you alongside the incumbent.
In the wild
Early Intercom had modern messaging differentiation but none of the table stakes of Salesforce/Zendesk/ServiceNow. Customers bought Intercom alongside the incumbent's 'big giant bag of table stakes' rather than switching. Over years Intercom built enough table stakes that customers could finally swap the incumbent out entirely.
→ Differentiation-first entry won the beachhead; later table-stakes investment unlocked full replacement and switching.
Common mistakes
Being different in ways nobody cares about
Google Wave was an amazingly innovative product no one cared about — differentiation without customer-valued relevance fails.
Chronically under-building table stakes
Intercom repeatedly over-invested in exciting differentiation and lost deals because it lacked a basic report or permission feature the customer required.
Is it for you?
Best for
Product teams auditing a roadmap, and startups deciding how to enter an established category
Not ideal for
Brand-new categories with no incumbent and therefore no established table stakes to match
From the transcript
“there's kind of two driving forces one is the attraction of the new solution and that's you that's basically differentiation what so what's different and…”
“they couldn't because we didn't have the basic report that they needed or we didn't have the basic permission feature that they needed”
“if you're startup you need to invest a lot more in differentiation and then over the years I think you start to balance the books…”
From the episode
What AI means for your product strategy
Paul Adams (CPO of Intercom)