I stared at the sea of snow around me. White as far as the eye could reach. A blank, empty landscape.
It was exhilarating at first. No one ahead, no one tailing or overtaking me.
Unencumbered, I was completely alone.
Then I realized I was lost. What direction was I going in? Was I going in circles? Was I even on a path?
It was my first snowboarding trip in Japan and I had taken a wrong turn. And now, the beautiful landscape around me was devoid of anyone, or anything, that might give me a sense of direction.
Years later, itâ€™s this experience that comes to mind when my friends in the startup industry complain about their competitors.
They long for a blank expanse of a market, free of competitors hurling their way forward alongside (or ahead, or behind) them. Itâ€™s an entrepreneurâ€™s daydream: no one to stop you from speeding ahead, eyes firmly on the prize.
Of course, markets devoid of competitors are rare: if a product is worth making, the market around it wonâ€™t stay empty for long. If it does, the product probably wasnâ€™t worth making.
Even so, the appeal remains. And thatâ€™s why weâ€™re often told to ignore our competitors completely.
Shut them out, focus single-mindedly on your product and users: everything else will fall into place.
And itâ€™s certainly true that an obsession with â€˜the competitionâ€™ is a bad idea. When companies get tangled up in rivalries, they often miss out on more important things (while Coke and Pepsi were battling it out, they failed to cash in on the arrival of energy drinksâ€Šâ€”â€ŠRed Bull is now the most popular soft drink in the world).
But do we have to choose between a blinkered focus or competitor obsession?
I donâ€™t think so. If we can adjust our lens, the landscape around us will begin to look different. Blinkered focus can turn into a peripheral vision that is both inclusive and alive with information.
A single companyâ€Šâ€”â€Šespecially a startupâ€Šâ€”â€Šwill naturally be limited in terms of the information it relies on. The combined knowledge of a number of companies operating in the same arena (or neighboring landscapes) is inevitably much more extensive.
And so, we can begin to view competitors as invaluable resources rather than pesky rivals.
The Perks of a Busy Market
Many startups enter an already-crowded market. Thatâ€™s often seen as daunting, or even deal-breakingly negative.
In fact, entering an unexplored arena with no context is much more daunting.
The support that comes with having competitors may not be obvious at first, but itâ€™s real.
By their mere presence, a competitor is already helping you carve out your category, make noise, and educate your users. They are legitimizing your idea, and proving thereâ€™s a market for it.
As Joel Gascoigne, CEO of Buffer puts it:
The real problem startups have is that most people donâ€™t know about them.
Competition can help to shine light on the market, which is often actually more useful than if you were alone.
There are cautionary tales of businesses that became â€˜victims of active inertiaâ€™â€Šâ€”â€Šlazy on their initial strong competitor-free successâ€Šâ€”â€Šand ultimately failed. And there are other businesses that, spurred on by new competitors, kicked their complacency habit to the curb.
Thatâ€™s because strong competition is the ultimate accelerator. Each individual step forward counts as a step for everyone.
Would Nike still be the king of sportswear without Adidas snapping at their trainered-heels? What would Steve Jobsâ€™ legacy be without Bill Gates? Would Salesforceâ€™s boom be as resounding without Oracle pushing it along?
Competition strengthens, rather than weakens, a market. Companies striving for leadership and out-servicing each other to win customers generates tons of value.
Plus, saturated markets are the most profitable. And if your business can thrive in a startup-crowded jungle, it can survive (almost) anything.
The benefits of a competitive market arenâ€™t reaped automatically. What you need is an all-encompassing awareness of the industry youâ€™re inâ€Šâ€”â€Šits peaks and troughs, new players and old-timers, innovations and disasters.
This will keep you nimble and agile, particularly if, like me, youâ€™re in a market thatâ€™s constantly shape-shifting and whizzing forward.
With peripheral vision of the big picture, you can steer fast and respond faster.
And when you adopt this frame of mind, the competitive landscape turns into a goldmine of information to guide you forward.
But how do we tap into this competitive intelligence?
It boils down to three basic steps:
- Gather data from a bunch of different websites
- Analyze the data
- Interpret the results
Of course, we do this kind of stuff all the time. The problem is, it tends to be a tedious, time-consuming process woven with endless opportunities for distractionâ€Šâ€”â€Šparticularly as half of the relevant information will be buried under the noise of the internet.
And really, there are a ton of better ways we could be spending our work day.
Humans arenâ€™t great at dealing with large datasets. Machines are.
Enter botsâ€Šâ€”â€Šclever automated systems. By linking to, and communicating with, multiple APIs (Application Programming Interfaces), machines like our new digital assistant, GrowthBot, can help us map the landscape weâ€™re operating in.
But the potential of automation goes further than this. Our capabilities as humans are finite, and often biased. As important as it is to stay on top of our industryâ€™s trends and transformations, weâ€™ll never be able to know it all ourselves.
Thatâ€™s because we rely on the limited amount of information weâ€™ve come across rather than a complete knowledge of our field (which would be impossible). Plus, we canâ€™t plug in a new server when we reach our information-processing limits.
A smart machine, however, will be able to learn literally everything there is to know about an industry and its players.
It can then summarize and present the core content back to us, bringing us as close to being all-knowing, all-seeing experts as itâ€™s possible to be.
Reducing Trial and Error
Hereâ€™s the thing: all businesses are testing the waters for someone else.
Itâ€™s up to those who follow in their footsteps to capitalize on this.
By paying close attention, a trailing company can cleverly reap the benefits of someone elseâ€™s successes and failures.
Thatâ€™s not as evil as it sounds. Itâ€™s basically common sense, or the â€˜second-mover advantageâ€™.
While the pioneer pays a steep price in creating the product category, the later entrant can learn from the experience of the pioneer, enjoying lower costs and making fewer mistakes as a result.
Imagine if Google hadnâ€™t paid attention to the mistakes in Yahooâ€™s UI, or if Uber hadnâ€™t exploited the public enthusiasm for Lyft?
Indeed, many of the worldâ€™s most successful businesses arenâ€™t built on originality. Instead, theyâ€™re launched by entrepreneurs who simply saw a gap in an existing concept. Perhaps that gap was better branding, smarter customer service or elevated UX.
One example is the way Apple redefined and dominated the market for mobilesâ€Šâ€”â€Ša category which Motorola pioneered.
The point is, this success is built on the swift, agile followingâ€Šâ€”â€Šand then improvingâ€Šâ€”â€Šof an idea; not on being the first to execute it.
Similarly, you can come to a conclusion in seconds (for free) that it might have taken another business hundreds of hours and thousands of dollars to get to.
There are shortcuts everywhere when you start looking. Opportunities to reduce trial and error on the basis of someone elseâ€™s experience.
Maybe similar strategies will work for you, maybe they wonâ€™t. Either way, the more you know, the better-informed your future decisions will be.
Put simply: insights arenâ€™t necessarily less useful when theyâ€™re second-hand.
Collective (Competitive) Intelligence
Collective intelligence within an industry is something we can all contribute to and benefit from, by pooling resources and building on whatâ€™s already been achieved.
Turning a potential battleground into a network, like in case of open-source software.
And along the road somewhere, your competitor could even become your collaborator: enter â€˜coopetitionâ€™ (cooperative competition).
The big players have set the trend: Spot.IM has started using Facebookâ€™s API, despite the fact that their goal is to keep users engaged on websites that arenâ€™t Facebook. Apple and Microsoft joined forces on the licensing of mobile operating system features and patents. Google funded Mozillaâ€™s Firefox. Arch-rivals Amazon and Apple teamed up to distribute Amazonâ€™s e-books through the iPadâ€™s Kindle app.
All these companies have the same target market, but they found that combining forcesâ€Šâ€”â€Šrather than constantly trying to one-up each otherâ€Šâ€”â€Šis a powerful tool.
And this mindset can be put into practice on a smaller scale, too.
As long as weâ€™re keen to grow, improve and adapt, there will always be value in questioning the tactics of businesses besides ourselves. Maybe the answers will surprise us, maybe they will inspire change.
Businesses like ours, yes; but also unrelated businesses we simply find interesting.
So no, itâ€™s not about an unhealthy obsession with our competitors. But itâ€™s not about shutting out those around us to create the mirage of an empty landscape, either.
Itâ€™s about curiosity, open-mindedness, a willingness to learn from others. And with the help of todayâ€™s AI, competitive intelligence can become a competitive advantage.
Source: New feed