When AI drops the marginal cost of creating competing products or services to near zero, how do we adjust our Target Market and Marketing Strategy on the V/TO to prioritize proprietary distribution channels over product features?

Question

Tyler Smith · Accepted Answer

When software makes it trivial for anyone to launch a copycat product or spin up competing marketing campaigns, product features cease to be defensible. When execution costs drop toward zero, the enterprise moat moves entirely to proprietary distribution, verified reputation, and captive client relationships.

Review your Marketing Strategy on the V/TO. If your messaging centers on feature lists or delivery speed, you are fighting a losing battle against commoditization. Shift your strategic focus to owning the customer channel. Define your Target Market with extreme precision: identify the specific demographic, geographic, and psychographic profile of clients who value risk mitigation, proven industry track records, and strategic partnership above cheap commodity execution.

Invest your strategic capital into distribution moats that software cannot easily copy. This includes exclusive enterprise channel partnerships, dedicated user communities, and deep client integrations where switching costs remain high. Update your Proven Process to emphasize the high-friction, relationship-dependent stages of your engagement: stakeholder alignment, governance oversight, and custom implementation. When execution is free, distribution and trust capture all the economic rent. Adjusting your V/TO around these proprietary channels ensures your firm retains pricing power while competitors race each other to the bottom.