Why cannibalization in product doesn’t have to be bad

Cannibalization, often seen as a negative market phenomenon, can be strategically leveraged to maintain and expand market share. It occurs when a product diminishes the market share of another product, and can be intentional, unintentional, or cross-market. Intentional cannibalization, as seen with Apple's transition from iPods to iPhones, can sunset older products in favor of more profitable ones. Unintentional cannibalization may occur within the same industry, such as credit cards overtaking checks, while cross-market cannibalization results from technological disruptions, like smartphones impacting the digital camera market. To utilize cannibalization effectively, companies should focus on providing greater value rather than just additional features, and should test and iterate rather than fully committing without understanding the market dynamics. Companies must consider other factors beyond the product itself, such as pricing and distribution, to avoid negative outcomes. Ultimately, cannibalization, when executed thoughtfully, can be a part of iterative thinking that drives innovation and market leadership.