I am sure you’ve seen this in most business 101 type books and articles. If you have no competition, you might need to rethink if you are in the appropriate business. But what if you have some competition? One of the first things I learnt as a product manager was never to underestimate your competition. If you go to a customer, who in the business I come from often has a Ph.D. and is a fairly smart person and tell them “XYZ sucks. If you go with our product your life will become so much easier”, especially if XYZ’s product is quite decent, you are likely to be politely told to leave (sometimes not so politely), and you lose a lot of credibility. That is why it is very important to understand what the competition is up to and never to dismiss them either in front of customers and, perhaps more importantly, internally.

So assuming you know as much as you can about the competition, what can you do? First, if you are the market leader, you can continue to make a compelling product and make it difficult for your competitor(s) to gain a foothold into your business. You can also make small changes to your business/product portfolio and go into areas where it will be difficult for the competition to add expertise, especially if they are trying to play catch up. In a more even playing field or if you are a new kid on the block, your best bet is differentiation. Don’t compete feature by feature. Rather find a niche that plays up your strengths, and truly differentiates your product. the differentiation could be in the product itself, or in the business model. Sometimes a different way of selling or product access is as powerful as a set of features. Of course, don’t forget the customer in the process.