Cheese and Ham

Cheese and Ham can replace each other. But they can also work together. When we're building a product, the way we see the relationship between our good and others matters.

When we see ham as a substitute to cheese, our mindset is focused on replacing it. We try to replicate its features and communicate its value in a similar way. This leads to more of the same. More undifferentiated products. Everybody loses.

When we see them as complementary, it's easier to make bets and to build other products that amplify their complementary properties. We can increase the demand for both products and creates more value for society.

Building smaller products and services that complement existing ones can be an effective strategy to enter a new market. We can focus on activities that generate value, learn a great deal about our customers and make use of channels that are already established. It was the strategy employed by Google before launching Google Chrome. Their toolbar for Internet Explorer amplified the latter and required less investment.

Two products can be substitutes and complementary at the same time. Ambiguous goods. We're thinking clearly when we're able to see their ambiguity and when we can operate with both mental models in a strategic way like Google did.