The Insidious Effects of Competition and How to Escape It

  • Post category:Articles
  • Post last modified:April 13, 2022

No one likes competition (except those that always win it).

And yet, we spend our lives competing — for partners, for jobs, for attention….

A huge volume of books have been written on “how to beat the competition” and expectedly, neither of them are really good.

Except for one: Different, written by Youngme Moon.

Youngme Moon is a Harvard marketing professor and author of what may be the most underrated marketing book.

I probably looked at over 30 lists of “best marketing books” and never once saw Different recommended in any of them.

Shame.

This book is like no other and deserves its place in the top 5 of best marketing books of all time.

Moon’s thesis is that competition transforms companies into perfect replicas of each other.

To avoid this fate, you have but no choice to get out of the competitive ring altogether.

To do so, businesses should follow three recommendations.

  1. Don’t measure yourself to your competitors.
  2. Don’t compete with your competitors.
  3. Escape competition altogether.

Let’s see how it works.


Don’t Measure Yourself to Your Competitors’

Businesses are obsessed with metrics and goals.

It usually goes like this.

Each department gets a yearly target they need to reach. That target is based on the competition’s target.

Some departments (engineering) will outperform while others (sales) will underperform.

At the end of the year, the company looks at what it did right and wrong and decides to focus on the underperforming parts of the business.

This is wrong, and here’s why.

Companies can’t focus on everything.

You whether lead on price, quality, or customer service, but you can’t lead on all three.

When you strengthen one part of your business, you do so at the expense of another.

If your USP is quality and you decide to lower your prices, one side of your business will invariably suffer.

Over time, focusing on weaknesses decreases your strengths. You become average at everything — but best at nothing.

You lose your position, your identity, and eventually, you lose your market.

Credits: auresnotes.com

Competition leads to comparison, which leads to sameness.

The metrics you decide to measure and the goal you decide to reach should be yours and yours alone — not your competitors’.


Don’t Compete With Your Competitors

Businesses mainly compete through differentiation.

This is a problem because it doesn’t work.

Over time, differentiation does not create more different businesses, but the opposite.

Differentiation breeds sameness.

Here’s why.

Companies are relentlessly trying to increase their market share.

Common sense tells them that it’s by having the best product with the most features that they’ll be able to attract the most customers.

So, they relentlessly innovate.

American Airlines introduced loyalty programs for airlines, HTC introduced dual-lens cameras on smartphones, and Hilton introduced air-conditioning in the rooms (a while ago, but still).

All of these ideas were quickly copied.

All airlines now have loyalty programs. All smartphones have dual-lens cameras. And all hotels have air-conditioning.

Did it result in higher market shares?

No.

It just leveled the playing field for everybody and made business harder at the same time.

image 94
Differentiation levels the playing field for everyone.

And the cycle repeats with the next wave of innovation.

Over time, companies that used to be quite different from one another, copy each other so much that they end up being similar.

Be honest.

Can you really differentiate Marriott, from Hilton, from Hyatt, from Radisson?

The multiplication of products within one category eventually confuses the customer.

The category becomes blurry and slowly dies.

Until a challenger comes and does something completely different.


The Real Way to Compete (Is Not Competing)

According to Moon, there are three ways to not compete.

1. Reversal

Reversal is taking away features and promises that the customer expects, and giving them what they don’t expect in exchange.

When search engines multiplied in the late 1990s, they all had a homepage stacked with information like weather, news, etc.

Then came Google. Google took away all of the information (what customers expected) and gave speed and accuracy instead.

The idea of the reversal is to go left when everyone goes right; give nothing when everyone gives everything; and open when everybody closes.

image 95
Yahoo VS Google

2. Breakaway

The breakaway idea is to break away from the idea that customers have of a product.

It’s selling “luxury cars” for a cheap price, cheap food for a high price, or blending together several categories.

Swiss watches had always been expensive and conservative.

There weren’t any for the younger, cooler crowd.

Until came Swatch. Swatch was a Swiss watch, but was everything we didn’t expect a Swiss watch to be — fun, colorful, young, and fashionable.

It became the best-selling Swiss watch brand in history.

Embed from Getty Images

3. Hostile

Hostile brands are brands that don’t fight to be bought.

They are unapologetic about who they are and about who they serve.

They play huge roles in the identity of their customers because of the message they are associated with.

Like Red Bull. Red Bull designed its whole image on rebellion and performances.

The beverage does not taste good, it does not look good, and the company embraced the rumors saying it comes from bulls’ testicles.

It worked.

Red Bull has no competition, and everyone knows what a Red Bull is.

Consuming Red Bull is making a statement.

And effectively, not everyone buys Red Bull.

Embed from Getty Images

Conclusion

Competitors run at the same time to the same place, towards the same direction.

The best way to win the race is to be alone to compete.

The best way to compete is not to compete at all.

To quote Carl Jung, you always become the thing you fight the most.

The more you fight your competitors, the more you’ll become like them.

So don’t fight them.

Don’t mind them.

Don’t look at them.

Focus on your market, take risks, and do something no one’s done before.

Photo by Ricardo Gomez Angel on Unsplash

For more articles, head to auresnotes.com.

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