The solution to stack fallacy is simple but really counter-intuitive. All of the mentioned examples, I mean every single one, indicate a business trying to force its way into the higher level through business channels. For example, when a business wants into a higher level they make it a business priority to create a new product and attempt to drive the priorities of this next level product through their business objectives. That is an epic fail.

It is important to instead concede that you don't know the needs of the consumers in the higher level, and if you think you do it is because you are guessing. The only way avoid the problem is to not attempt to move into the higher level, at least not intentionally and not through business priorities.

This is extremely counter-intuitive because there are generally fewer expenses and greater market frequency at each higher level, which means superior revenue potential. Businesses exist to make money and to ignore moving up to the higher level means denying this potential (vast) revenue source.

This doesn't mean you can't move into the higher level of the stack and be really good at it. It just means you cannot do so both intentionally and as a business objective.

The solution is to double-down on where you already are with what you are already good at and focus on product quality of your existing products. Continue to improve where you are already good. Improvements and enhancements to existing products can gradually yield the next level as the improvements progressively open new potential in an evolutionary fashion. While getting to the next level this way is much slower it is also risk reduced and continues to associate your brand with quality and consume satisfaction.

This will only work, though, if the goal is improving the current product and not acquiring revenue in that desired higher level. Think evolution and not revolution. It has to be a gradual, almost accidental, increase of capability based on meeting current consumer needs.