Respect the competition

March 17, 2010 · 1 min read

In business it's easy to over-focus on the competition. Knowing the competitive landscape is indispensable; your product has to be differentiated and ideally you are building defensible assets. But your primary focus must be on the customer or user and the value you create for them.

I was reminded of this today when I read a post by Garry Tan quoting an article on Netscape and how they over-focused on Microsoft. Garry says that "having an enemy can focus you in intense ways, but might focus you on the wrong things" (and adds that for a startup, "your competitor is the back button"). I agree.

I'd go further: It's wrong to think of competitors as enemies at all. Business is not war. You shouldn't aim primarily to fight your competitors or to hurt them. The right model is a sport or game: we're all aiming to be the best in the same field, we play fair according to established rules (law and contract), and at the end of the day, we shake hands and congratulate each other on a match well played.

You should be glad to have competitors: together you form a market that attracts and retains customers. You should be glad to have competitors who have gone before you: they educated the market on your product category (creating a new product category is extremely difficult). You should be glad to have good competitors: bad competitors give your product category a bad name.

When you discuss competitors internally, don't trash them. Respect them. Be sportsmanlike. Don't be afraid to praise them for what they do right. Make sure you know what you do better and where you are uniquely positioned to create differentiated value. Find your confidence in that, rather than in putting down competitors.

Externally, it's probably best not to discuss competitors at all. Amazon has a long-standing policy of not commenting on the competition publicly. It certainly seems like a no-win situation: If you praise them, you promote them. If you criticize them, you open yourself to rebuttal. Either way, you give competitors publicity you could reserve for yourself. So maybe it's best to keep your mouth shut.

So go forth and compete, don't fight—and may the best man win.