In my previous article, I talked about the need for the right mindset or philosophy when looking at competitive products.
Here, I want you, dear reader, to realize that the competition is sometimes where you don’t expect it to be.
There are two types of competitors: the tactical, and the (for want of a better term) strategic.
Tactical competitors are companies or products you compete with toe-to-toe for the same market. For example, in an RFQ process, your tactical competitors are the other companies bidding on the same RFQ. Examples of tactical competitors are McAfee and Symantec in the PC security/anti-virus space.
Strategic competitors are those, which if successful, will wipe out your raison-d’être. They will cause such a large paradigm shift that your market will disappear beneath you. In the example of McAfee and Symantec, think about what will happen if Apple were to grab 95% of the PC market tomorrow. While Apple’s OS X operating system is not 100% malware proof, it is so much better than Windows that the need for McAfee or Symantec security products will mostly disappear. Yet you don’t think of Apple as a competitor to McAfee or Symantec.
Strategic competitors are harder to spot because they are often not on your radar screen. Most times, they are outside of your space, yours or your company’s area of expertise.
The only way to spot strategic competitors is to be ecosystem-aware i.e. know what makes up the ecosystem of products or services in the space that you are in, and understand the effect on the ecosystem if something changes either within it or on the periphery.
Every time a new product comes out, think about what the impact it will have on the ecosystem. This is particularly true for products that are launched with a great deal of buzz. The publicity surrounding these products can result in a snowball effect (of similar or complementary products) that can topple a pillar propping up the ecosystem.
You also want to watch influencers like Apple whose latest-and-greatest often change the world order, and cause a ripple effect on multiple ecosystems.
When you do spot a strategic competitor, can you do something about it? Most of the time, the paradigm-shift is larger than any single company.
The solution here is to be agile enough to re-tool and ride the new wave. Being able to do this counts towards beating your competition as most of your less savvy tactical competitors will probably not survive the shift.
