What strategies do you use to differentiate your product from competitors in a crowded market?

You want to understand your competitors but more than that, you need to understand the core value of your product and tie that to the customer value you provide. This does not always need to be your product capabilities - it can be your company’s vision, history, or people's expertise, or your community, etc. 

The goal is not to get hung up on features but rather play on the emotional side of why customers should choose you - and then why they should choose you over others.

"How to eat an elephant?"
"one bite at a time"

That's how to approach when thinking about a Market. The question then is, where are you going to bite?

First you need a good understanding of the market:

• who's going after what customers/personas

• how they position themselves

• dynamics of the market - network effects,

• When and how do customers change?

• Is this a mature or fast-growing market

You want to find a segment of the market that you can win - that you have the strength and the possibility to win. Most of the times you not going head-on with the leaders, you find a flanking move, a guerrilla tactic to go to a segment that is less contexted and you have what it takes to win.

That segment can be defined by one or several:

• Price - from discount to premium

• Geography.

• retail channel (digital, stores, supermarkets,...)

• engagement channels - where you contact and engage with prospects - maybe you can be the King of TikTok, Reddit, or even a specific community on those platforms

Find where you can win, even if the segment is small. And go from there.

Now, all the actions need to be coherent with that target. But once you're committed to that, it will be easier to make choices and evaluate results.

• Who cares deeply about your product/promise and is not being addressed by a strong competitor?

• Who are they and where can you find them?

With the market understanding and identification of the segment you can focus on, you should be able to maximize your results comparing to trying to "eat the elephant" all at once.