Competition: Is it a good thing or bad thing for my business?

LatestDeals
LatestDeals
Tom Church
Co-Founder
LatestDeals.co.uk
In association with
The Pitch 2016
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Competition is an invisible pressure on the mind. Every day it makes you think, how can I do this better and faster? It's almost as if it were the atmosphere itself; one tonne of air pressing down on your shoulders and yet, at the same time, unnoticeable. 

You compete on price and you compete on position. You benchmark your competitors and keep a watchful eye. Keep your wits, stay consistent and you'll have your slice. But, as I've discovered, there's a problem with this. 

It is what W. Chan Kim and Renée Mauborgne, professors at business school INSEAD, describe as a Red Ocean Strategy

By focusing on the competition you voluntarily walk into their ocean. You watch how they fight, you learn their tactics, you copy what's been done before. It's competing on their terms, turning the ocean into a bloody shade of red. 

What if you could make the competition irrelevant? What if you could create your own ocean? A new market without labels, categories and existing benchmarks. 

Cirque du Soleil did this by blending opera, ballet and circus. NetJets did this by creating fractional jet ownership. Dyson did this by inventing cyclonic vacuum cleaners.

New markets, without competition.

I wish my business, LatestDeals.co.uk, started like this. Instead, I followed traditional advice. I did the market research (deals and voucher codes), saw there was space and entered. I benchmarked ourselves to our competitors and joined the red ocean. 

In the deals and voucher code industry there are benchmarks everyone measures: number of users, size and quality of discounts, prices charged to brands and Google rankings. The latter is still the largest source of revenue for all of these companies, a fact that has worried one of the largest groups, RetailMeNot. They stated in their last financial report they were still too overly reliant on search engines and were trying to diversify.

Our company got off to a good start. We were achieving steady growth and we were breaking even. But the others had a 10-year head start. Some have over two million users. 

So I wondered, how can I make the competition irrelevant? How can I make a Blue Ocean all for myself? That's the day I began to ignore our competitors. I turned my attention to the future, to the unknown. 

We launched products that hadn't been done before: a tool that finds discount codes for every Domino's store in the UK. A stock checker that tells you when hard to find products like the Nintendo Switch are in stock (Nintendo is a brand that admits to consciously employing Blue Ocean Strategy).

We started to focus on the long-term; years, not months. We're researching the use of artificial intelligence to help with price comparison. Using advanced image recognition to bring the world of bargain hunting to augmented and virtual reality. The impact of smart assistants such as Siri and Alexa that will help you save money. 

These are markets that don't exist yet. There are no competitors here. It's just us and a lovely blue ocean. Yes, they may follow - but that's the point. You take the lead.

So what can you do with your business? How can you make competition irrelevant? Blue oceans are waiting to be found.

Latest Deals' sister company Latest Free Stuff was a finalist of The Pitch 2015. The Pitch is the UK's biggest small business competition, and we're proud to say 2017 is our 10th year. With our inspiring programme of awesome advice, ideas and events, we want to educate and empower entrepreneurs and early-stage startups to succeed in business. Find out more here.

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10th May 2017 11:19

Hey Tom
I like your article because its thought provoking. Some will read it and dismiss it, probably quite rightly becaiuse its simply not practical for their business.
BUT, many should take the hint and ask themselves the question, could I make my own market of 1? good strategic challenge.
BUT, remeber if and as and when you do, you face the very real task of CREATING a market. E.g. We are elephants dont forget and we are in a bucket of 1 - which on one hand is cool. no competition. On the other its a bummer because what do people search for.
if people are used to horses and dont know what a car is they type "faster horses" into Google. All your competitors own that space. You own "cars" but nobody knows about cars in that blue ocean world.
We have lived this for the past 4 years and eventually we have concluded that we do actually have to enter the red sea or we have to spend the most serious amount of money educating the market that we exist.
so in conclusion. LOVE the article and the strategy nudge from the sidelines. But careful whast you wish for it a big ocean and small things are hard to find in big oceans! connect with me on Linked in please.

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