Posted by: OurKudos | April 11, 2011

Who is our competition?

As we ‘old folks’* say “when I was young and naive”, when people asked me about my competition, I would say we had none, or maybe one direct competitor. In those days, my company made one of the only real-time video image processing systems. In our niche market, we really had very few direct competitors. We owned that field.

But who is our competition? Let’s look at the real competitors we had during the mid 1980’s.

We had a disruptive technology. Until that time, most people in our target market were using film and 35mm cameras or movie cameras. Because we were trying to shift the market from using film to video, we were actually competing with companies like Nikon and Kodak – companies with entrenched technologies.

Who else were we competing with? In a sense, we were competing with the status quo – people used their eyes for many observations, so we were competing with a “free” solution to the problem.

Fortunately, we did indeed have a disruptive technology that was so compelling, that early adopters were willing to spend $50,000 for our product! And then, when we brought the price down to $17,000 a few years later we achieved even greater market penetration. But still, compared to 35mm cameras and film, our was a premium solution. We didn’t know who are real competition was.

*I’m around 47 now, definitely old by internet startup standards.

Today, I see things with much wider open eyes. Competition is all around. Our product could consider all the big players as competition on some level – Google, Facebook, Twitter, Foursquare. Even email could be considered a competitor.

And so when we have strategy sessions, it’s easy to be intimidated. But I see it differently. By honestly assessing the competition, you can analyze their weaknesses and capitalize on your competitive advantages.

These pictures of bicycle races are representative of the competitive landscape. Yes, that’s me in blue and white.

There are racers who love riding off the front of the field. They don’t see the competition riding just behind them, using vastly less energy. They feel like they have no competition. And in many cases, these rider are some of the strongest in the bunch. But if you don’t know your competition and understand their strengths and weaknesses, they’ll swallow you up.

In racing, I’m constantly evaluating my competitors. Who looks strong today? Who has a cold? Who is tired from a race yesterday? Who is wasting their energy today. Who is my real competition today? Who are the smart racers? Who use poor judgement?

I usually scoff at sports analogies, but in this case, it fits incredibly well. If you don’t know both who your competition is and what their capabilities are, you’re likely to lose the race.

Let me finish with a question – have you gained (or lost) a competitive advantage due to your competitive analysis?

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