How does GoPro keep Competitors at Bay?

Is it the Hardware?

Let’s dig a bit deeper into why GoPro’s success is so exceptional. How does the company keep competitors at bay? We can safely assume that a GoPro camera offers a superior value for customers, compared to a competitor’s camera. We can also assume that this is the main driver for the camera’s success.

Yet, this doesn’t explain why no one else is able to replicate this offering. We know that Polaroid developed some groundbreaking innovation. But today’s consumer electronics space in which GoPro operates looks different. Its technological development is at an advanced stage. Most competitors are in a position to manufacture equal products. It is like the Formula 1 auto racing. You may be leading one season, but all of the key teams have the resources to catch up and beat you the next season. In GoPro’s case the names of those teams are Sony, Canon or Nikon. Those three as well as other consumer electronics companies have the technical as well as distribution and marketing resources to launch a possible GoPro Killer. Even smart phones today are able to record video in HD quality.

In the league of markets, that offer only little room for differentiation combined with cut throat competition, consumer electronics certainly makes the top of the list. Not without reason, we haven’t seen many IPO’s in this jungle. It is dominated by large and powerful players.

In its IPO, GoPro raised $427 million at a valuation of $2.96 billion. There is something in particular remarkable about this. The company not only raised the money in the consumer electronics sector, where large IPO’s have become rare. It also raised it based on a single product.

So we are talking about a company, which managed to build an edge in a mature market. And so far GoPro seems to be successful in keeping competitors at bay. I fully realized the extent of this advantage at the 2014 ISPO, the biggest trade fair for sports equipment. A small number of GoPro copycats exhibited at the fair. They offered products, which were similar to GoPro. While the booths of the copycats seemed to be almost invisible, GoPro’s booth was packed with enthusiastic fans that celebrated the brand, like it had just won the Formula 1 championship.

This raises a puzzling question. We know that Polaroid had built its competitive advantage on its innovation capabilities, technological advantage and patents in the earlier stages of the imaging market. But how is GoPro able to keep its competitors at bay in this late and mature stage of the market?

… or is it Hardware meets Content meets UX?

This question has two answers.

First, the fans at GoPro’s ISPO booth were not celebrating a physical device. They were celebrating something intangible. GoPro is not only selling the physical device but the experience of capturing and sharing adventures. Users don’t capture videos and images just for themselves. They want to share them with their friends and family, fellow athletes or fans. The growth of the popularity of social media and in particular of YouTube makes this sharing much easier for them. GoPro managed to not only deliver the camera, which captures the experiences, but it built a community around the sharing of those experiences. The main residence of this community are GoPro’s YouTube channels. GoPro’s main YouTube Channel has close to 3 million subscribers. For comparison, Apple has 2,3 million subscribers. So is all of the content on this channel user-generated and GoPro is just hosting it? As an accommodating landlord, GoPro goes beyond just hosting the videos, which are created by the community. The company has an in-house editorial staff, which curates and also produces content. Thus, what used to be a hardware company, a camera manufacturer, has implemented elements of a media company.

The community is only one reason why GoPro managed to keep competitors at bay. The second is the functionality of its product design. Unlike Polaroid, GoPro did not build its technological advantage through fundamental innovation. GoPro’s advantage is based on optimization of the usability and functionality of an existing technology. GoPro builds products that provide superior convenience to a specific customer group.

The quality of the cameras is, of course, excellent. These devices shoot in HD and offer wide angle shooting. Yet, this is rather an enabler than a differentiator. What differentiates the cameras is that GoPro’s are built very robust. Even extreme athletes don’t need to worry about breaking the camera during an accident. Using it is simple and they can be set up easily during sports adventures. The small form factor helps athletes carry the camera wherever the adventure takes them. In addition, lots of useful accessories and mounting options help users in filming whatever activity their adventure consists of. They can mount GoPro on their equipment, whatever they do. This usability is what makes customers go for GoPro.

Now why is it hard for competitors to match that usability? On a first glance it doesn’t sound too hard, does it? To develop such usability, an understanding of the specific customer groups and their needs is critical. And this is where GoPro shines. GoPro’s founder is a customer himself. He built the first camera for his own surfing activity. Conducting product development meetings doesn’t really help companies understand customer needs. Living the life of a customer however does. It’s not for nothing that consumer goods companies, such as Proctor & Gamble make the effort to send their product development teams to live with customers. When the Gillette brand launched a new product in India, the team spent two weeks living – and shaving – with local families, as A.G. Lafley describes in his book “Playing to Win”. If a deep understanding of customers helps to build a better razor blade, just think what it can mean for a video camera.

By being close to their specific target customers, GoPro managed to take an existing technology and both optimize its user experience and find new use cases for it.

image credit: Redd Angelo / Unsplash

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