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Key Takeaways
- Your main competitor might not be another company but rather the current methods customers use to solve their needs.
- To identify your true competition, ask customers about their previous solutions — find out what worked and what didn’t.
- Understanding the limitations of past solutions can reveal market opportunities and guide product differentiation.
Your biggest competitor is usually not the product that has similar features to yours. In some cases, it’s not even another company in the same industry.
Your biggest competitor is what your customer is doing right now to do the “job” that they would use your product for. This could be a manual process, a workaround they pieced together themselves, or some tool you never heard of.
Understanding this can reveal opportunities you didn’t see before. To figure out who you’re really up against, start by asking yourself these simple questions.
Related: 4 Things You Should Never Do When Dealing With Competitors
1. How have you tried to solve this problem in the past?
You want to know how your customers’ mind works when they encounter a problem. This question allows you to get insights into their thought process, as well as the resources they have on hand that they’ve considered before your product entered the picture.
For example, if your product is a project management app, and you ask customers how they were doing their job before, they might say through tons of spreadsheets and sticky notes.
This tells you two things: First, that the problem was important enough for them to hack together a system, and second, that there’s a gap between what they wanted and what those tools provided.
By tracing their previous attempts, you’ll see what other options are accessible out there and where those solutions fell short. In the given example, those spreadsheets may have become too messy to maintain or those sticky notes may have been misplaced each time. Each answer gives you valuable clues about what your product must do better.
2. Before this product, what were you using instead to get the job done?
This question might seem simple, but it digs straight into the heart of your competition. Keep in mind that customers rarely start with your product, or any new product for that matter.
They’re replacing something. Whether that’s a competitor’s product, a free tool or even a “non-solution,” that’s for you to find out. Understanding what that something is will help you identify the strengths and weaknesses of existing solutions.
If a customer was using a well-known competitor, you’ll learn what features kept them around as well as what eventually pushed them to leave. If they were using a free alternative like Google Docs, you’ll see what kind of value proposition you need to provide to make the switch worth it.
Think ride-hailing apps. Before Uber, people weren’t asking for another taxi company. They were all just hailing cabs, calling dispatchers or arranging rides with friends. Uber competed with the way people thought about getting from point A to point B.
By asking this question, you put yourself in a position to spot the same kind of market opening, only this time, you know more about what to expect.
3. What worked well, what did you like most about it and what didn’t work out for your old solution?
It’s obligatory to know about past failures, but don’t forget about what worked well. Customers stick with solutions for a reason, and these reveal industry standards you shouldn’t overlook and opportunities you can build on.
If customers liked how easy it was to share files in their old system but hated the lack of version control, you’ve just identified both a baseline requirement (in this case, easy sharing) and a chance to differentiate (a solution for stronger version tracking).
If they loved the price point but struggled with customer support, that tells you how to frame your value against theirs.
By digging into both likes and dislikes, you get a well-rounded picture of what customers expect, what they tolerate and what they wish existed.
Related: How to Beat Your Number One Competitor (It’s Not Who You Think)
4. What was the biggest problem with your old solution, and why is it a problem?
Every product or system has pain points, but not all of them are dealbreakers. That’s why this question matters. You’re looking for the one flaw, among many flaws, that created enough frustration for the customer to finally look for something new.
Let’s say a small business used free accounting software. Maybe it was clunky and lacked some automation, but they managed. Then tax season rolled around, and the software couldn’t generate the necessary reports.
Suddenly, the inconvenience became a critical failure, and they went searching for a replacement. That moment when the old solution stopped being “good enough” is where your opportunity lies. If you can clearly articulate how your product eliminates that problem, you’re sure to win over customers. At the same time, you won’t fall into the same trap as the solutions that came before you.
You want to know what you solve better than the old solution, and you want to avoid having that same problem with your product.
Instead of aiming to become an expert on your product, aim to become an expert on your customer base by asking yourself these four questions. In fact, if you want to stay ahead of the competition, then stay close to your customer.
Key Takeaways
- Your main competitor might not be another company but rather the current methods customers use to solve their needs.
- To identify your true competition, ask customers about their previous solutions — find out what worked and what didn’t.
- Understanding the limitations of past solutions can reveal market opportunities and guide product differentiation.
Your biggest competitor is usually not the product that has similar features to yours. In some cases, it’s not even another company in the same industry.
Your biggest competitor is what your customer is doing right now to do the “job” that they would use your product for. This could be a manual process, a workaround they pieced together themselves, or some tool you never heard of.
Understanding this can reveal opportunities you didn’t see before. To figure out who you’re really up against, start by asking yourself these simple questions.
