Adding features to a product adds more power to the product, yet at the same time adds complexity that makes it hard for new users to even get started.
Create a product that competes because it’s taking a fundamentally different position in the market.
Know Your Market
If the market is full of complex enterprise tools, then make a simpler product aimed at individuals.
If the market is made up of fancy, high-end wines, then create one that’s cheaper, younger, and more casual.
If the market is full of long-form text blogging tools, then make one that makes it easy to communicate in 140 character bursts.
If computers are techy and cheap, then make one that’s human and more premium.
Ramifications for startups building initial versions of a product
Don’t compete on features
If your product initially doesn’t find a fit in the market (as is common), don’t react by adding additional new features to “fix” the problem.
Make sure your product reflects the market positioning