How much should I pay attention to my competitors?Lindsay Says
When you bring a distinctive and motivating benefit to your customers, competitors cease to matter.
Peter Thiel once lectured that “Competition is for losers.” While I don’t love calling anyone a loser, I doggedly embrace Thiel’s premise. Your focus as a leader should be on the customer, not on the competitor. Focusing on competitors creates a zero-sum dynamic. It limits the value you bring to the customer, thereby limiting your business’s value.
When you focus on your sweet spot customer and your uncommon ability to solve a problem for that customer, competitors become decreasingly relevant. Solving a large customer need in your ownable way produces an inherent competitive moat.
The more care you devote to outdoing competitors, the less energy and time you devote to expanding your distinctive source of customer delight. Your ultimate competitive advantage stems from focusing on customers, not on competitors.
Spotlight your Uncommon Denominator
Some of you know Ironclad Brand Strategy’s Uncommon Denominator Framework. The Uncommon Denominator is the promise you bring that (1) is motivating and compelling to your customer, and (2) leverages your ownable strengths as a business. The Uncommon Denominator is a resonant promise that you alone deliver. It is inherently a positioning where you win.
When you focus on your Uncommon Denominator promise, you increasingly:
- Expand your ownable strengths
- Delight your customer
- Enlarge the pie. Avoid the zero-sum dynamics of continually seeking to steal market share
Leader Myopia & Availability Bias
If you're focused on the competitor, you become blind to the larger business opportunity of solving a customer problem in an ever more compelling way.
The availability bias is our cognitive tendency to over-credit information and stimuli readily easy to see and recall. All of us, including the most superb leaders, suffer from the availability bias and the resulting myopia. Buzz about competitors is often more readily available to our cognitive attention than is customer delight. Unchecked, leaders’ attention often rests on competitors.
Avoid this trap. Identify your Uncommon Denominator promise, and then make it starkly visible to yourself and to your teams. This way, the availability bias works in your favor.
All Ships Rise
Don’t mistake this as advice to pretend you lack competitors. That would be neither practical nor beneficial. Rather, consider this advice not to fetishize competitors. Direct your precious resources to amplifying your most distinctive and customer-motivating capability.
After all, it is your customers that you are in business for! Through your offering, you are asking prospective and current customers to part with their hard-earned money. They are the ones who deserve your attention! When you are laser-focused on fulfilling customers’ unmet needs, competitors fade in importance. This inspires a flywheel of customer delight and value creation.
Is there ever a scenario in which you should focus on competitors? Yes. In a shrinking market.
If your business’s offering is in a declining category, such as fax machines, you indeed face a shrinking pie with zero-sum dynamics. You therefore must fight for every point of market share, because you face a dwindling universe of customers open to buying fax machines.
So, if you sell fax machines, you can ignore my advice. Go ahead and focus on duking it out with competitors. (Then again, if you run such a business, I imagine that you are not reading articles about brand strategy!)
Amplify Your Uncommon Denominator
Customers don't care about your competitor. They care about themselves. You should too! If you're building something of huge enduring value and growth potential, then you drastically limit yourself by focusing on the competitor. You miss the opportunity to win the hearts of customers and expand your moat.
The more you amplify your Uncommon Denominator promise, the more your brand becomes the only relevant option for your sweet spot customers, and the less that competitors matter.
Your ultimate competitive advantage is the result of NOT focusing on competitors.