Industry Competition: Look Outside of your Own

It’s risky to box yourself into your own industry when others outside of it are solving customer problems in a different way.  You might be familiar with the traditional definition of an ‘industry’ as something like, “a specific branch of manufacture and trade.” For many applications, this perspective is perfectly adequate. But for the purposes of competitive intelligence, this approach can be limiting.

When a customer sets out to buy something, they are hoping to solve a specific problem. Their search will be framed in terms of how well any product does this, and they are likely researching many different kinds of solutions.

In other words, customers are considering solutions from everyone, not just you or your traditional competitors.

Looking at just your own ‘industry’ keeps you from seeing all of your competitors.

Consider your non-industry competitors

Kaego Rust is the CEO of KHOR Consulting working with organizations and non-profits like the Nelson Mandela Foundation, and she puts this perfectly when advising new clients on their competition:

“Your competition may be whomever your customers decide to spend their money with, instead of using your product. E.g. Even if you are the only restaurant in town, you may be competing with movie theatres, bars, convenience stores, or food trucks.”

Every one of your products is a solution to some customer’s problem, and other companies might solve that same problem in a very different way. TomTom competes with Apple because the iPhone’s maps software solves for a user’s problem of navigating while driving. They’re not direct competitors, but their product features are.

In some cases, the customer can even become a non-industry competitor. Take the hotel industry as an example. The traditional market of demand and supply has been entirely upended for hotels, where they are now competing with homeowners on platforms like Airbnb as well as other hotels. In essence, their customers (or potential customers, at least) have become their competitors.

Dinesh Sharma from Digitalist Magazine breaks it down and appropriately states:

“If you think about it, this is the actual consumer need the hotel industry grew to resolve, but the solution became the industry along the way.”

Companies that have defined themselves and their industry in these standard terms will miss opportunities and limit their reach by putting themselves in a box. An ‘industry’ should be defined as a set of potential solutions to a customer’s problem.

Stepping back to look at multiple solutions to a customer problem allows a company to take advantage of every possible market and sale. Moreover, a firm customer-centric understanding of how products and services meet needs can help maintain focus when positioning or developing new efforts.

How can you stay in tune with industry and non-industry competition?

The first point of call is to ensure proper competitive research is undertaken before you launch any new feature, solution, product or service. And once you do, you can implement a competitive intelligence program to guide everyone in your organisation; from marketing to sales, finance to executives, your company will be a better position to make strategic moves, and win more in competitive situations.