Let’s say you work for Work Pups, the newest software-as a service provider for managing corporate dog parks. Big corporate office buildings are adding dog parks to bring millennials back to the office and those offices need Work Pups software to make it happen.
Well, not exactly. Those offices need software, but not everyone is choosing your software. The corporate dog park market is really heating up and Bow Wow HQ is starting to show up in a lot more deals. The Bow Wow HQ product is clearly inferior. They just copied Work Pups’s user interface and hired a third rate designer to make it look different. You’re pretty sure the only reason they win deals is because they have a massive sales team.
When Bow Wow HQ is mentioned in the company chat, everyone piles on. The CEO of Work Pups calls them “Bowser HQ” and even kicked off an internal campaign to see who could photoshop the best Bowser HQ logo. What a bunch of losers.
There’s a lot of excitement about Work Pups. Sure, the product is still new, but the new features are going to be amazing. There’s no question to anyone on the team that Work Pups is going to be the absolute best product in the market.
But is the attitude at Work Pups going to be helpful in meeting customer needs?
About those competitors
It’s easy to pick on a fictionalized software company, but the truth is, when you’re pouring your blood, sweat, and tears into building a product that customers love, it’s easy to dunk on competitors. “Those jokers, what do they know?”
Making fun of the competition has never really felt right to me, but I’ve struggled with explaining why. I mean, when you’re the good guys, why not have a little fun making fun of the bad guys?
The problem with making fun of the competition is that it’s the wrong frame of reference. Every customer who chooses the competition is signaling that they have needs that your competitor is able to meet that your company was unable to meet. Rather than making fun of the competition, we should be asking what unmet needs the competitor is able to meet that we’re missing. This applies to every step of the customer’s journey, not just the product.
“They’re winning because they spend so much on advertising.”
You mean they’re willing to spend money helping customers in the awareness stage of the customer journey to know what solutions may exist for the problem they’re having?
“They’re winning because they spend more on sales than improving the product.”
You mean they recognize that their prospects are sophisticated buyers that need to be educated across multiple tiers of the organization to justify significant spend in a brand new market category?
“They’re winning because they just make checkbox features that are inferior to ours.”
You mean they’ve identified that there’s a significant portion of the market that is content with having their basic needs met and who don’t need additional complexity to solve their problems?
Responding to Competition
You don’t have to like how a competitors chooses to serve the market and you certainly don’t have to try to copy them, but framing competition in terms of needs you weren’t able to meet gives you the opportunity to make a strategic decision about whether you want to meet those unmet needs or not.
On one hand, you might determine that the customers the competition is acquiring wouldn’t be a good fit for your company. For example, if you compete on value and differentiated innovation and your competitors seem to win only the most price-sensitive customers, that’s probably okay. You want the customers who see the value in your product and are willing to pay for it.
On the other hand, if your competitor is acquiring the same customers you would want to acquire, but they do so more successfully, you have to ask what they’re doing to meet customer needs that’s gaining them a superior competitive advantage.
Don’t waste your energy making fun of the competition. Figure out why competitors are meeting customer needs better than you.