Competition is fundamentally good. It is a confirming sign of a market need. Competition allows for different companies to serve different segments with different customer needs.
How you choose to compete is one of the most strategic decisions you can make as a start-up. It is essential to find your strengths and focus. Going head to head with direct competitors, especially established competitors, is a recipe for failure. Targeting an underserved market segment is a recipe for success.
There is no one way to create your niche. But there are some frameworks you can use. At the core, you need to find a person who is struggling to get a job done and make it easier for them. Think about what the competitors focus on and find those customers who can’t access the current solutions and how you can better serve those customers. Here are some go-to strategies to create your competitive position.
- Simplicity: less features, easier to use, all-in-one bundling. This strategy targets a user who is a novice or occasional user. The basic features get the job done. No need for the Pro version – think WordPress, Canva, or Quickbooks.
- Convenience: easier to access, easier to find, accessible to more people. Many people value their time and will pay to avoid a hassle – think Amazon, MedExpress, Sheetz, or DoorDash.
- Affordable: lower price point to increase the number of people that can afford. Affordable often goes hand in hand with simplicity. To be at a lower price, the product must in fact cost and eliminating features is a great way to accomplish that goal. A lower price point broadens the market opportunity – think Canon desktop printers, the Ford Focus or Walmart.
- Outcomes: improve the outcome or reliability against key customer measures. This strategy is essential for Business-to-Business sales. Companies care about performance and always have key performance indicators. If you can move the needle on something the company cares about, that’s a win for everyone.
Watch this video to see a great conversation on how to create a positive competitive perspective and find YOUR unique position to meet the needs, wants and values of customers YOU strive to serve vs. the alternatives you feel you must compete against – and bear the related costs of doing so.