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24 Comments

If a competitor exists, then what?

There's no right answer, and a lot of it just "depends" on various angles. BUT, I think generally, during the idea/validation phase competitors are pretty disheartening.

What are people's general thoughts on how to deal with finding DIRECT competitors during the idea/validation period?

Is it a deal breaker, or just a hurdle?

  1. 7

    Competition is a very strong signal that there is money to be made in the market. It means that people are already familiar with the concept and not hesitant to part with their money. Basically, you swap an idea validation challenge with a sales and marketing challenge. Just make sure you are not entering a winner-takes-all type of market (e.g. social networks).

    1. 1

      hey @jmstfv, thanks for the comment. Interesting... you're saying, if competitors exist then the concept doesn't need validation.. instead you can do the same concept but with better sales/marketing?

      Hmm that's really interesting. And what about differentiators. Sure the stance/position/focus needs to be a little different, but HOW different does it need to be.

      Many times I see different services in a space which all almost reach what I want ideally, but none quite reach it.

      In that case, is it worth launching yet another player which is only slightly different...?

      1. 1

        And what about differentiators. Sure the stance/position/focus needs to be a little different, but HOW different does it need to be.

        Your product doesn't have to be a carbon copy of your competitor's product.

        You can differentiate by price (probably not a good idea), by niche (you build the product tailored for the specific group of people), or by a particular combination of features (which others in your market don't have). One avenue where early-stage companies can excel over incumbers is in providing great support. Having a unique voice also helps to stand out from the crowd.

        Mix and match until you get where you want to be.

        instead you can do the same concept but with better sales/marketing?

        Unfortunately, more often than not, better-marketed products win over better products.

  2. 6

    For me, it's a good thing. Essential even. If there's no one already in that market place then it's almost always best avoided. Plus when there's a competitor it means you do clever things like market to their followers on Twitter etc

    1. 1

      hey @aciddrop, hmm, interesting. You're saying, if there's a competitor there's even already a market to target... Hmm.. I guess I'll ask the same question I asked in a another comment... And what about differentiators. Sure the stance/position/focus needs to be a little different, but HOW different does it need to be.

      Many times I see different services in a space which all almost reach what I want ideally, but none quite reach it.

      In that case, is it worth launching yet another player which is only slightly different...?

  3. 3

    A competitor always exists.

  4. 3

    You can use this table to find your sweet spot: https://i.imgur.com/f7n9KSH.png

    Your unique features and your niche market can overcome any competition. Also remember that big companies are usually slow to react to a new player.

    1. 1

      @anicetix hmm that is VERY cool! Is I remember the lean dashboard from back in the day! I should really fill one of those out before I start.

      So you're saying, within the market, find a niche market and produce a product suited specifically to them thus resulting in unique features (unique for the niche market).. is that the idea?

      So I start with defining that niche market, and figure out the unique features that would serve them?

      That's a nice approach of the crossover for niche and unique to survive with competition. Can you think of any examples?

      1. 1

        You should easily find the examples that you need. It only depends where you want to go.

        Here are two more concepts that can help you switch the lightbulb on:
        https://en.wikipedia.org/wiki/Disruptive_innovation
        https://www.investopedia.com/terms/d/disruptive-technology.asp

  5. 3

    Sometimes there's room for multiple players. Depends on your ambitions and competitive advantage (of which there can be many). If competitors exist it means the likelihood of that product being in demand is higher -- it's your validation in a sense (unless they are also a startup and you have no idea how long they've been around).

    Tons of things existed when new players came into the scene and completely dominated incumbents.

    1. 1

      @genemachine hmm yes someone else said a similar thing but you've articulated it very nicely.

      So, in your thoughts, if a competitor exists then the idea is validated. So what am validating?

      Other suggested one needs to differentiate... in which case, aren't you looking to validate the differentiated positioning? Am I right? Or is differentiation not needed and you can build a better version of the same feature set and focus on product quality, marketing etc etc?

      1. 1

        Plenty of products with minor differentiation exist - making plenty of money. This is why I said it depends on your ambitions - do you want a 20k/mo product or 1m/mo?

        Look at how many location mappers, booking software, referral software exist out there. All do essentially the same thing and many doing just fine financially and living comfortably.

  6. 2

    It's good to have competition and we should celebrate this.

    Why?

    1. You're not alone
    2. You've giving target customer an option
    3. The validation and learning process is faster
    4. There's a market need
    5. There's a growth opportunity

    and many more...

    Try to avoid the mindset of "copying", "stealing" or "demotivating". Look at the bright side where you can learn a lot from your competitor and motivate yourself to deliver a better product. @thatandyrose

    1. 1

      Hey @felix12777, you've kind of blown my mind! :-) I love your positive outtake on it. And yes, I love the idea of focusing on learning from, but ultimately delivering a better product.

      I've been reading the other comments and have been asking a similar question so I'll ask again as it's interesting to get different view points.

      In existing markets, I see a lot that I would do differently, that perhaps could be better for a particular type of person (like me perhaps)... but, how DIFFERENT does it need to be? And I'm not talking about stealing. I'm more talking about... sometimes I see products that are ALMOST there, but if I tackled it it would be only slightly different (in features for example, but completely different in look/feel/branding etc). Is a slight difference in features enough

      I'll give you an example.

      There's an anlaytics package I love. I love it's take on how to collect your data.. BUT, I think it does a horrible job at presenting industry standard insights to the user without them having to learn the app etc. I'd love to build an alternative that basically works the same way, BUT the focus is in not requiring the user to learn the app before getting value from it... etc...

      to me that doesn't feel "different" enough to launch etc...

      I'm not asking you to validate my idea, but rather, I wondered if you had thoughts on a that differentiator idea?

  7. 2

    Look at segmenting the market. Look to build a differentiated product (if they've been in the game a while you won't build a better product from scratch). If you gain traction a competitor may become an exit. It also depends of course on how many direct competitors and how dominant they are.

    1. 1

      thanks @rab. What do you mean by segmenting the market? In terms of differentiator, how DIFFERENT does one need to be etc? Thanks again, super interesting.

      1. 2

        Tinder clone for bookworms - perhaps it exists but without knowing much about dating apps I know similar apps are happening - would target a specific segment of the market; a segment unhappy with the current (shallow?) offering. As we know DuckDuckGo have achieved this brilliantly, realising privacy was an issue for many users of Google and have built their business on that segment of the market. Albeit with a differentiated product - but it is interesting to note their product is actually inferior!

        I'm sure we could find lots of successful examples where product differences are marginal. Finding a key issue (e.g. privacy) has to be an avenue to pursue but generally I think there are many examples where having a product that doesn't completely suck with a super-low entry barrier and lots of marketing has been a route to success. Look beyond the product itself for the differentiator as well - such as great customer service , although of course that takes time to prove.

        I saw in another post that you're a bit frustrated having found a direct competitor and/or a crowded market. Makes me wonder about web hosting companies / cloud providers. There are loads and loads, with huge players, but the likes of Digital Ocean somehow cut through that. I may look that up.

        Are you still considering the web builder idea?

  8. 2

    It's signal. Good news. But game theory time. If there are lots of competitors that show up, then the VCs will start to circle and that does affect your business if there are multiple companies that receive big bets. Then it's tough to be an indie. You might want to think 2 steps ahead.

    1. 1

      @jenvandermeer Hmm... really good point I don't think anyone's made yet. So, for an indie, you're saying not worth competing with VC funded competitors...? Can we not be cheaper, more patient etc, or do they just have the capital to kill you however they want?

  9. 2

    Then you have an established market. Good for you. Now figure out how to make yourself different. Who do they target? Who can you target? Learn about Michael Porter's Five Forces framework. Message me directly for more information.

    1. 1

      emailed you Joe :-) thanks so much!

  10. 2

    If a competitor exists it's actually a good thing, it means there actually is demand for your product/service. If you can build a better product than them then (wow that's a lot of "thens") you can succeed.

    1. 2

      :-) so all I need to do is build a better product?! Pfft, easy! ;-)

  11. 1

    Great! If a competitor exists, then you know there is a market for your product.

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