A strong competitor that only a few people care about and how that giant is key to winning the market (Competition part 2)

As we have discussed in my previous article about how to know your competitors, we have together realized that competition is such a defining and decisive factor to success in business, especially in startups. We went deep into different ways that people normally recognize their competitors and things that you should pay attention to because once you wrongly identify your competitors, you find yourself making wrong moves and failing to win the market.

Last week,  I promised that Today we will now explore together a giant competitor that only a few people in the ecosystem care about and how that overlooked stone became the cornerstone of those who cared about it. 

Most of the time, when Someone starts a business or enters a new market, one of the moves that most people take is to analyze the market. The market analysis includes identifying competitors because almost everyone now knows that to win the market, you have to beat the competition. The problem is neither the market analysis nor the identification of competitors, they are both important. The trap that I want to reveal here is what we overlook in this whole process yet it is one of the important parts of competition analysis or identification.

Who is that giant?

I named this giant competitor the “INITIAL USER SELF-ARRANGEMENT”. I will be referring to it in the article as “self-arrangement” to make it short and easy for me. This “self-arrangement” competitor is defined as the initial reaction or arrangement that the users or the target customers used to solve their problems. Let’s dive deep into it to get more clarity.

If you are working in a startup/company or if you are trying to find one, I assume there is a problem that you are trying to solve, maybe you are helping people to make money or anything but I know there is value you are offering to the market. Ask yourself, before I come, how were things being done? If it’s a problem you are solving, ask yourself, how are they dealing with this problem right now? If it’s a game that you are building for entertainment, ask yourself how are they having fun now.

That initial arrangement that users do while trying to solve their problems is the biggest competitor that you will ever have to face, especially for people who are bringing a new product that has no other competitor in the same market. You will find people using their arrangements to fix their problems, so convincing them now to leave their arrangements is not a simple challenge as some of you think.

In the book “The lean product playbook”, Dan and Olsen wrote about how problems define markets, and they told us the story in that book of Scott Cook the founder of Intuit ( The company that owns a popular financial software called Quickbooks) when he was Speaking to a group of product managers, Scott asked them, “Who is TurboTax’s biggest competitor? (TurboTax is tax preparation software)” Multiple hands shot up. At the time, the other major tax preparation software in the market was TaxCut by H&R Block. After someone confidently answered, “TaxCut,” Scott surprised us all by saying that the biggest competitor to TurboTax was pen and paper. He pointed out that, at the time, more Americans were still preparing their taxes by hand using IRS forms than all tax software combined.

The same scenario happened to a startup that was developing a retail app for helping small businesses with bookkeeping. I was doing consultancy with that Startup and I remember when we were introducing the solution to the market, our biggest competitor was not other software products but a pen and a notebook. People were telling us that they don’t have any problem with their books, and that’s when I learned that the “Initial user self-arrangement” is the main competitor to beat if you want to position yourself well in the market.  Let’s talk about why it’s important to analyze that competitor first.

Why is it important to analyze it first?

The first reason why we should analyze the “initial user self-arrangement” is that It helps to better understand the real market situation. When you observe how people have been trying to solve their problems, you will have a very deep understanding of the real problem that they are facing, what they prioritize or which problem they want to be solved the most, their pain points, and what problems they don’t care most about. 

And those questions you ask yourself are the most difficult questions to answer when you are doing the discovery. Most people choose the easiest way of talking to people, but if you have done discovery for quite some years, you know most of the time people tell you what you want to hear, they don’t like to hurt your feelings. I am not saying that asking or talking to customers is not a good way, No, I am a fan of talking to customers, but you cannot rely only on what they tell you and build a great product.

The second reason is that “your other competitors didn’t necessarily get it right”. I used the word “necessarily” because I know that those other competitors are very important also to analyze, with them you can see how they tried to improve the “initial user self-arrangement” and how it’s working for them. It also inspires your moves.

But we also have to keep in mind that they are not always right, some of them brought their solutions without even taking into account the “initial user self-arrangement”, and when you are only counting on them for inspiration, you will also be misled. Because as a new business, your solution needs to have reflections of the "initial user self-arrangement". You have to be solving their pain points and looking at how you can keep whatever they enjoy or find helpful in their current solution.

So when you are in the discovery process, both in the problem space and solution space, When you analyze how users are trying to solve their problems, you understand both the problem they have and also the solution that can improve their situation and bring more value to them.  Not even when there are other competitors in the market, You should analyze both them and the “initial user self-arrangement”. This is a better way of obsessing with your customers than your competitors.