How do I know who my competitors are?

Gregg Fairbrothers:  The worst thing in the world is to be in an investor presentation and be asked about a company that’s doing something directly competitive with you, and you have never heard of them.  The search for competitor intelligence never ends.

  1. It’s a good question! One of the biggest rookie mistakes is to say, “We have no competition,” or “No one is doing this.”
  2. The first answer is that it’s hard to ever know who they all are, but you should find as many as you can.
  3. Remember, your customer’s wallet is one of your competitors. There is always the option to not buy and just hang on to the money.
  4. And then there is the status quo—what the customer has always done before, or the product they are buying now. It’s a mistake to only look for the competitors who are selling products like yours. Products that fill a need in different ways are competitors too—like the person looking to buy status to show off and can do equally well with a fast car, expensive clothes, or an over-engineered home entertainment system.
  5. There are all kinds of places to look for competitors. The obvious ones are data sources, trade journals, trade shows, web searches. Ask your customers, vendors, investors. The people looking to enter a market are as important as the ones already there.
  6. The next question to ask is, “How can I be better than the competition?” There is no glory to being just another undifferentiated product or solution. That reduces you to a commodity, and commodities only compete on price. You want to think about competitive advantages and barriers to entry.
  7. And the last question to ask is, “What can I learn by studying my competitors?” They are studying you!

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