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29 Comments

Mentally Dealing with Competition

Hi all,

Lurker here... first post, so be nice. :-)

How do all of you think about competition? Feeling honestly depressed today as I go down a well-worn path:

  1. Think of an idea that solves a pain point in a great way
  2. Start to research what solutions are already out there
  3. Find a company doing exactly what my idea was, and get discouraged

Does this happen to you all?
How do you keep it from discouraging you?
Does it stop you from pursuing your idea?

I explained this to my wife, and she pointed out there's UPS and Fedex, Zillow and Trulia and RedFin, etc. Her point is there's lots of successful businesses that are out there that own a portion of a market, and I don't have to own it all. I agree with that on principle, but don't you all feel like you should be working on a problem that you are solving in a unique way? If not, why not?

Even though I thought of this idea independently, I still kinda feel like a copycat if it's not any different than how they're solving the problem.

Appreciate any thoughts.

  1. 8

    If you can't find any other company doing what you want to do, that's probably a massive red flag that what you want to do might not support a viable business.

    As for dealing with competition:

    I spent most of my career in HR tech, building a product that basically did the same thing as dozens of other products by the end of my time in that world. Despite the dozens of competitors selling against us, the vast majority of the time when we sold a new deal the "competitor" we displaced was a homegrown system, email, or spreadsheets.

    Realizing that despite the huge number of competitors out there, most businesses we encountered weren't using any of them was a big wake up call for me - a well-sized market can support a lot of companies doing very similar things and even though you might see a dozen "competitors", your potential customers might not have even heard of any of them.

    I try not to look too much at what competitors are doing unless I'm directly selling a deal against one. Otherwise, they're useful to know and keep tabs on to track trends in the industry, but if the market is big and you know your place in the market, they'll be plenty of space to grow and you shouldn't spend much time focused on them.

    1. 2

      +1

      OP should reverse your thinking - competition is a pre-requisite for any idea, otherwise you've got to do all the validation yourself. When there is competition, now you've just got to figure out how to make a better product / have better marketing / leverage some kind of advantage (note competing purely on price tends to be a bad idea)

      1. 1

        Thanks Christopher! I like the framing and will borrow that... competition is a requirement to pursue an idea.

        But humor me, what if your solution was exactly the same (sure, some marketing differences or whatnot)... how would you get up every day, motivated to work on it? In that situation, I feel like if anyone interviewed me "so why did you build X when Y already existed?" and I wouldn't have an answer.

        The problem isn't that I wouldn't have an answer for them, it's that I wouldn't have an answer for ME. And thus how to stay motivated? Just by sales? Thanks for any insights on this.

        1. 1

          You'd find ways to make it better. It's very rare that two products are identical. And honestly, if your users are happy and you're adding value to their lives that's all that matters.

    2. 1

      Thanks, David. I like this perspective that so many of these competitors weren't directly competing with you but for just customers with no solution yet. I think having not much differentiation factor means you could still get customers with no solution yet, but probably won't get any customers to switch from a competitor's solution to yours.

      I guess where I get hung up is if the company I found is doing things exactly like I planned to... and they look like they're doing a good job at it. Like, it's not like their website looks like it's from 2005 or their solution is just a dumb way to do it.

      In those cases, where it feels like I'd be entering the space as an exact copycat, is it still worth pursuing, in your opinion? Sounds like that was the case for your HR tech product. Maybe as I got going, I'd see opportunities to be better, or I'd have better internal processes so my profit margins would be fatter. But for arguments sake, and just knowing myself, I always want to be doing something that's better or more clever in some way, and so I feel I wouldn't pursue such a space. I'm just wondering if I'm doing that at my own detriment, because maybe it's practically impossible to be truly unique in today's global connected world?

      1. 2

        One way to think about it is that no competitor is going to be an exact copy of what you do, even if the feature set is identical.

        Some differentiators that aren't product features:

        • How you structure and staff your company
        • What your company's values are and how those values influence how you do business
        • How you position your features in the market
        • Who you sell to and how you sell to them
        • How you support your customers
        • Your industry knowledge and credibility
        • Relationships and trust with key stakeholders and industry influencers

        Those might not seem exciting differentiators when you're thinking about all the cool stuff you can build but what I encountered constantly in the sales process was that our customers cared a whole lot more about the overall experience they were buying than they did the features we offered. Features matter but very rarely did a feature seal the deal on a new sale.

        The reason for this is the old sales maxim of selling value, not features. Features are easy to copy, and most buyers are looking for solutions to pain points, not comparing a list of features. The buyers that are just looking for features X, Y, and Z are often really poor long term customers, in my experience.

        The most impactful differentiators we had were all things related to our business model and our way of selling and supporting our customers. Eventually some of what made us different ended up being embedded into our product architecture that came with interesting and unique engineering problems to solve to make those processes scalable.

        Those differentiators were truly unique and extremely difficult to copy but they weren't things that we created on day one - we had to learn the space and find our niche first before deciding how we would build our moat.

        But for arguments sake, and just knowing myself, I always want to be doing something that's better or more clever in some way

        I think this is an important mindset shift to make, and is a good way to wrap up this too long reply.

        Try to expand your idea of what "better and more clever" is outside of features to build.

        Even if you identify a great new feature that no one else has, that feature will immediately be copied by your competitors 100% of the time. Instead, focus on how you can build a company that wins in a niche in a way that can't easily be copied. You're still solving problems, you're just using a broader set of tools.

        Build the core feature set you need, even if it isn't unique, and then iterate on the feature set AND the business as you learn from customers what they need and where the market is lacking.

        (Sorry this got so long, I really enjoy talking about this particular topic!)

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          Thank you, David. This is fantastic! (And not too long.. if you couldn't tell, I'm verbose myself :-)

          I need to make that mindshift -- that I can differentiate my offering in the business itself, not just the product or its features.

          However, I strongly agree, those aren't as exciting as a cool new technology approach! I have to admit... those would likely soon be copied (unless you could patent them or they were network-effect or switching-cost type moats).

  2. 4

    What I misunderstood about business for the longest time:

    • You start with a weak imitation.

    • You identify what makes the imitation weak.

    • You iterate on the imitation until it’s better than the original.

  3. 2

    Thank you all. After digesting and replying to many of the responses to my original question, it's clear to me that everyone agrees that it is a great thing (especially in a crowded market) to have some sort of differentiating feature or aspect to your business.

    One thing I wondered is how people can be motivated when their product isn't that different from other solutions on the market. I'm counting price and marketing strategies as insignificant differences here, for sake of this question, because they don't have anything to do with the product or solution itself (more like go-to-market approaches).

    I didn't get many thoughts on that sub-question, but in sum, it sounds like what motivates people in those situations could just be:

    • A strong passion for the problem. A love for it, or a "life's work" type of calling.
    • The fact that many of your new customers won't have heard of your competitors anyway -- the real competitor here is their current homegrown solution or inaction. Of course, your product needs to be better than that! :-)
    1. 1

      Great summary, @JoelWigton.

      Within your addressable market, you'll have two types of prospective customers: ones who are problem-aware, and ones who are solution-aware.

      The first are your dream customers. They don't know about your competition, because they've never looked. All they know is that you solve their problem.

      The second are your validation, and if they switch to you from a competitor, you're doing something right.

  4. 2

    I think it's great when someone has already built the thing I imagined - that means I don't have to! If you are only moderately interested in the problem, stop there and find a different problem.

    But if you are in LOVE with the problem, and you recognize the competitor is not getting full traction.... try this. Try to find 10 people with the problem and try to sell them on using the competitor's product. Say, hey I found this great solution. I am putting the word out and helping people sign up.

    Now you start REALLY learning about the problem space. Because you find out why people aren't buying that idea you had.... and you didn't have to build it!

    If the competitor's produce is really easy to sell, just a slam dunk at a high profit margin... then they have a sales problem and you can copy and steamroll them. But it's more likely... there's something wrong with your big idea... and you will leapfrog 6 months ahead in your learning based on the other guy's work and expense.

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      Thanks, Jesse. That's an interesting strategy.

      I think much of my root problem may lie here --> "If you are only moderately interested in the problem, stop there and find a different problem"

      I get a lot of ideas. I'd say all of them I'm only moderately interested in. (HIGHLY interested with each when I first come up with them, and that high lasts for several weeks. Like, can't think of anything else for that time). But I can't think of a single idea I've had where I'm like "I want this to be my life's work" like Patrick Brown of Impossible Foods or something.

      Any advice what to do in this case?
      Keep looking for my Impossible Foods, even if it takes me years?
      Pursue something I'm moderately passionate about to pay the bills and get some success under my belt? Perhaps the passion for the idea will follow after working on it and getting my headspace into it more.

      Thanks for any more insights you may have.

      1. 1

        I probably can't help someone find their life's work - that's really personal. But I still say, if you're obsessed with something in the short term and find someone has built "your idea", by all means find 10 people and sell them on using it.

        You will learn a lot more about the problem space and find out how good "your idea" really was. You will build that skill of having a solution in hand, trying to get users, and then finding out what the real obstacles are.

        Honestly, it's probably easier to do this kind of thing and find a product you are well suited to sell and grow... then build it later.... than come up with an invention from scratch and build it and THEN find out if you're able to sell it.

  5. 2

    A few thoughts

    1. If the problem is a burning, real and genuine one, there will be solutions out there.

    2. Independently coming up with ideas that have been executed by others is actually a good sign that you are thinking about solutions the right way

    3. There are 2 types of problems, ones you observe and ones you experience.

    The ones you experience ar the ones you are likely to have deep insight on, because when you faced the issue you probably evaluated existing solutions.

    Typically observed problems are in the category that you describe. Try and look for deep insight is my suggestion

    1. 1

      Thank you, Ishwar, I agree.

      I typically experience problems rather than just observe them, but that's when my "idea-generation" part of my brain kicks on right away. I end up "inventing" the solution to the problem without first even searching for or evaluating existing solutions. So in a way having an inventive mind can be a curse instead of a blessing, as I don't feel the pain long enough to evaluate solutions that are already out there, I just rush to solve my own pain point right away, because I can.

      I have considered using my competitor's product because, for now, I still do have the original pain point that sparked this off. Perhaps as I use it, I will find something they're doing that could be done better, giving me the deeper insights you mentioned.

  6. 2

    Getting started with my venture, the more time I spent trawling through IndieHackers, Twitter and Facebook, the more discouraged I got seeing other people trying to solve the same problems I was.

    My advice: focus on YOUR business.

    If there's a big competitor doing something similar, that's fast validation there is product/market fit. Run your own race and look forward, not over your shoulder. You'll feel much better. I'll echo what David said above, in that I also rarely spend much time looking at (or worrying about) what our competitors are doing.

    1. 1

      Thanks, Lachlan. I feel the same way -- maybe that's a clue that I'm following those competitors too closely?

      After writing my post, I came across this Twitter thread that I think puts a good perspective on it. https://twitter.com/shreyas/status/1284160537366953985

      Short summary.. use competition to:

      1. validate people are paying to solve this problem
      2. understand customer segments, value prop, advantages and disadvantages to their approach, and their go-to-market strategy

      Make a table of these for a few potential competitors.

      But a key point being that you shouldn't be SO focused on what they're doing that you just copy everything they do. Conversely, you also shouldn't blissfully ignore your competition at all. Don't fixate on them, but be aware enough simply to understand your market better.

  7. 2

    I think there's a positive way to frame this, people often like to say that competition just means that you've found a problem worth solving. In many fields, you don't need to be #1 to be profitable and build a valuable company.

    On top of that, being first can actually be a bad thing. Historically, there are a lot of examples: think of MySpace and social networking or some of the early Slack competitors.

    If you are entering a crowded market, it is definitely important to find a unique value. "Obviously Awesome" is a great book on positioning if you haven't read it. Maybe you have a unique feature, pricing model, or audience that your competitors haven't thought of?

    When I started my app 8 years ago, it was one of only a couple of gratitude journal apps. Now there are dozens (hundreds?) of gratitude journals, mood trackers, and therapy apps. Being first isn't an advantage unless you can stay ahead of the pack and if you find a compelling niche, be sure there will be a pack of followers!

    (I'm constantly stressed about competition btw!!)

    1. 2

      Thanks, Matt! Obviously Awesome looked like a great resource too, just ordered a copy.

  8. 1

    So, I started Leavetrack 10 years ago. I just actually missed the 10 year anniversary of buying the domain name.

    In those ten years, I have done nothing to promote the product - it was a side gig and I guess I thought people would just find me!

    I look at competitors now and recognise the feelings you have - one of my main competitors quotes 8500 customers. If I had put the effort in ten years ago that I'm putting in now, I'd be retired. :)

    But, that shows there is an active market for the product and key is figuring out my place in that space. What makes me different? At the moment, it's personalised service - I am but one man so can be responsive and proactive with customers. I know my customers by first name.

    That won't last forever but finding your space in a well-trodden sector is perfectly do-able and you know then that the opportunities exist.

    1. 1

      Thanks, Robin.

      And if being able to scale up to those 8,500 customers would mean losing your differentiating factor (one man, highly-personalized service), would you still have done it?

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        Haha - good question.

        I don't know if I would have made the leap from solid full-time employment to my own business. A year after starting Leavetrack, I had my first child so while I'd like to think yes, if it had grown quickly then I'd have probably looked to sell.

        Now it might be a different question. Flexibility and managing my own time is more important to me even if it meant a temporary/partial reduction in income while I scaled.

  9. 1

    Competition means the idea is valid. You can totally launch your product and get differenciated on other aspects than the solution itself of the problem (pricing, extra features, brand image...). You can also get inspiration from what these competitors are not doing well enough and offer a product that improves what is a flaw for other companies

  10. 1

    IMHO, finding companies doing the same thing is also a validation of your idea.
    And most of time market is big enough for multiple players to survive and also thrive.

    TBH, I have created ASMI (https://asmiapp.page.link/c8Ci) with same intent that Breathing marketspace is very large and irrespective of the players who are already there my product will extend its benefits to its fair share of users.

    So let's not drop our heads. Instead, work our ass off and create products that users will love.

    CHEERS

    1. 1

      Thanks for the encouragement!

    1. 1

      Thanks, Kishore! That was a great read. I enjoyed the original Twitter thread from Shreyas Doshi as well.

  11. 1

    Your wife is right. You can be successful doing the same thing as others( mostly by finding something they aren't doing right/lacking and doing it right ).

    Note: This platform was acquired by Stripe but there are subreddits/forums/fb groups with the same idea as this platform. This platform just removes so much noise and focuses deeply on a group of individuals.

    What I think: Realizing that your ideas are already being implemented when you search means you are on the right track. It's a mental exercise of learning how to come up with good ideas. Be glad you came up with an idea out of the blue and others are already making $mm out of it. One day it'll be your $mm to claim and when that is up, seize your moments

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