Your closest competitor just received great exposure in a major publication and then landed $5 million in venture funding. You are probably thinking that it is time to chase the editor of a great news source then start pitching your company to venture capitalists as well. Before you go and try playing catch up with who you think is your direct competitor, pause for a moment to consider your thought process.
David Cancel wrote a truly insightful post on this very topic, where he outlines that your biggest competitor is customer apathy. It is not the company who sells the same product to your target market, it is customer apathy. Why? For many market segments, especially in this post-recession period, your customer will be making the decision of whether or not to use your product or service or nothing at all. You will be fighting harder than ever to earn their dollar. Positioning yourself against the competition is not the key.
You don’t have to price your products or services below your competitors’ price. Focus on providing the most value to your customers and potential customers, and define your company as one of quality, service and commitment to innovation. However, setting yourself up to be found by customers is equally important. Not worrying about your competitors doesn’t mean that you should not worry about who your potential customer will find first. Optimize your search engine listings, market your brand and be found. Upon being found, focus on the value of your company, and nothing else.
If your business is in a hyper-competitive market, your approach should be to first ensure that the customer can find you, second, that you properly convey the value of your product or service, and third, you should get your customers to take action by making it easy and convenient to make the purchase of your product or service.
Upon taking these steps, you will avoid wasting time on focusing on your industry competitors while putting effort into your customers. This is what matters. Regardless of how amazing or horrible your direct competitors are, apathetic customers won’t buy your product or service. Focus on the big picture and your business will be fine.