This is pt.3 of our three part series on competitive spying. In our first post, we talked about the top 6 tools we like to use for competitive analysis followed by how to find the best companies to copy. In our last instalment of this series, we’ll talk about your true competitors, who (hopefully) might not even be companies at all.
The Biggest Opportunities
When you were fundraising, did you convince your investors that your market is huuuge? Fact is, the truly enormous markets are notcompetitive in the beginning. They usually take one of two shapes:
Creating a whole new category (like eBay, Twitch or Slack) or,
Democratising and expanding an existing under-served category (like Uber or Spotify)
In both cases, your largest pool of prospects aren't using any dedicated product, because no practical option exists. But some of them might be using a workaround.
For example, before Spotify became the music streaming giant, people illegally shared MP3s. And before Slack existed, teams sent messages internally using desktop clients from P2P messaging tools like Skype and IRC. And it seems like every B2B SaaS company’s biggest competitor is Excel.
Workarounds are a big business. So, how can you spot these huge unmet market needs? First, don't worry about competitors! Instead, start by understanding your customers, where they’re struggling, and especially how they’re coming up with workarounds to address these needs.
In B2B, workarounds can mean hiring people to fill gaps (look through common tasks & search terms on UpWork?) or some combination of “duct tape” type tech solutions (Google Sheets, Zapier, Airtable, Notion, etc.) cobbled together to make a process.
But most importantly, just ask them! There’s a special interview technique designed to uncover workarounds that represent huge unmet needs. My partner Nopadon explains it all in this three-minute clip below. (But ignore that very last thing he says, he's totally crossed the line).
Speak soon!
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Video Transcription:
Hey, guys, it's been a while.
I hope you're well, so. We work with a lot of startups, and we know lots of teams are obsessed with our competition. What are they doing? What are they advertising? What are the keywords they're optimizing for?
There are loads of tools, tools that will help you do this.
Similar web SEMrush. Don't get me wrong. I have an issue with these tools. I think they're fantastic. But what if I told you you are missing out on your hidden competitors?
I'm Nopadon from Startup Core Strengths, and today I'm going to show you how to find your competitors that are hiding in plain sight and what to do with that information.
Look, it's no secret. We're huge fans of the jobs to be done methodology, and we use it with all of our teams. One of the key concepts in jobs is alternative solutions. You compete with whatever your prospect is using to make progress.
Guess what? It's rarely a direct competitor, some sort of a hack workaround to help them achieve their desired goal.
So here's an example. Who does BA or your favourite airline compete
with? AA, Delta Virgin. But the hidden competitors are any of your video conferencing systems.
If your goal is to have face to face meetings, then yeah, web conferencing competes with business class travel.
All right, let's try another one. What's one of the biggest competitors to the New York Times or your favourite news provider? If your goal is to stay informed, then many people use Twitter to keep current with what's happening around them.
So how do you find your hidden competitors? And what are you supposed to do with that info once you've got it?
All right, we're going to chat with loads of prospects or people who recently signed up or paid the fresher, the better. Ask them, "how are they solving their problem before finding you"?
Let them tell you their story, try to understand their circumstances. What were you trying to do? How did you go about doing it?
Listen carefully for the workarounds. Ask them what else did they consider? Finally, listen for things that aren't direct competitors or solutions that aren't even your product category. Chances are they're not the only ones solving the problems this way. And in fact, we often find way more prospects using the alternative solution, aka The workaround, than those using the existing products. And getting these insights can open up a vast, untapped universe for you.
So you want to find more of these people? What do you do?
You could potentially create blog posts, or you could create content targeting people searching for or how to make progress without alternative solution.
So if you're Expensify, you might do something like "how to create an easy expense forms in Google sheets" or create a landing page and target those keywords with PPC.
There are loads of possibilities once you know what your hidden prospects are looking for.
Look, if you enjoy our content, please consider Liking and Subscribing. In addition, we put out a weekly newsletter that's super short and super helpful.
Just like my partner, Matt.
I hope you're well.
Talk to you soon.
Bye.