To compete or not to compete

February 17, 2016 - 5 minutes read

Some time ago in a group somewhere on Facebook, there was a discussion among business owners on the concept of competition. Someone said that there is no such thing as competition and that remark just blew my mind.

We can pretend that there is no such thing as competition under the guise of business spirituality, or positive thinking, or whatever type of business values you work by, but in reality, competition is there and ignoring it is not a very smart thing to do (to put it nicely).


Competition is there if you want it to be or not. Simply because your (potential) client – be it a business or a consumer – can only spend his money once. So on that level, you may be competing with totally different products and services in a different category that you yourself provide. If you are a boutique with cute clothes, you may be competing with a new phone, a pair of boots, groceries, or a night out when it comes to share of wallet. And the same thing applies to businesses. They too have to choose how to spend their money.

When your potential customer has decided that a certain part of the budget should be spent on a new printer for the office of a new pair of boots for winter (if it is a consumer), then you start competing with other businesses who can meet that same need. And based on the need competition can differ; check out my post on what you can learn from who your competition is. An alternative for boots could be other types of warm shoes. Within the product category of boots, the competition can come in all kinds of forms and shapes. It can be local, it can be online. In the case of the boots, it can be mass produced or handmade. It can be offered at different price levels, service levels, generic or as a well-known brand. And it depends on your customers’ preferences what they will choose and if they will choose you.

Sustainable advantage

Competition exists and you have to deal with it. That doesn’t mean you have to keep track of all your competitors in order to imitate them. To the contrary, you have to know what they are doing in order to do it differently. You have to have – what competition guru Michael Porter calls – a sustainable competitive advantage. By that, he means that you have to do something different, better than your competitor and that something should not be able to be easily copied.

As a marketing nut, I am continuously observing the world around me and it never ceases to amaze me that so many businesses offer the exact same thing. In Spain, the average restaurant seems to try to be as average and as much the same as any other restaurant as possible. Their interior and menu are pretty much interchangeable. And if everything is the same you can set yourself apart by the level of service or the price level. And you do not want to compete on low prices, as only one can have the lowest prices. By the way, in Spanish restaurants, they seem to go for low prices and poor service.

Another example is the sale of souvenirs. We were in Sevilla some time ago and street vendors and souvenir shops all seem to be selling the same stuff.  It doesn’t leave much room to compete. The stalls at the Plaza de España in Sevilla say it all. They all sell the same things. I am thinking that these sellers have a hard time even though they are in a prime spot.

So what do you do to distinguish yourself from your competition? What is your sustainable competitive advantage?

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