Want to Turn Heavy Competition Into an Advantage? Copy Your Competitors' Best Features. The old advice, "Focus on your own business; your competitors will only distract you," no longer applies.
By Matt Smith Edited by Dan Bova
Opinions expressed by Entrepreneur contributors are their own.
Although Snapchat is still a major player among the platforms populating today's social media landscape, influencers and their advertisers are starting to abandon the platform.
Related: Creating an App? Know Your Competition First. (Infographic)
CNBC recently reported, for instance, that Harris Markowitz, a nominee for the Shorty Awards' "Snapchatter of the Year," had left Snapchat to pursue greener pastures on Instagram. CNBC also reported that after Snapchat went public last March, by June its shares had plummeted almost 20 percent. This was due, at least in part, to Instagram's replication of Snapchat's model.
Instagram is still continuing to make it hard for Snap to acquire new users, for several reasons. One is that Snapchat's closed network makes it difficult for interested companies to see those user numbers, so companies can't tell which influencers have a large or engaged audience.
By contrast, Instagram's analytics and transparency make it easier to track followers and engagement levels while growing a business -- so it's no wonder why so many Snapchat users are jumping ship.
What the Snapchat vs. Instagram competition means
What their online combat means for the rest of us is that competition breeds innovation. Had Snapchat gotten ahead of the curve on advertiser-friendly analytics, it could still be dominating the influencer market. Startups and small businesses need to learn from this example and find the value in their own competition before they fall behind.
What does "finding the value" mean? It means that they can learn by looking at those competitors, then offer something they don't.
But of course this has to be done carefully: Copying your competitors without understanding their motives won't result in your creating a valuable product. You can't just look at what others are doing; you need to understand why they're doing it, what makes that move successful and how it could be done better.
Using the following tips, you can help your business grow and evolve by keeping close tabs on your competitors.
Related: 3 Reasons You Should Spy on Your Competition
1. Find the best elements of your competitors' products.
Don't copy blindly. Look at other products and services and ask yourself which features work -- and why.
When Facebook and Instagram copied Snapchat, they didn't clone that platform. Instead, they observed which features were getting the most engagement -- namely, Stories -- and then slowly rolled out their own version, which leveraged their own customer base and data.
Instagram co-founder Kevin Systrom weighed in with this on Recode about competing with Snapchat: "[Snapchat] adopted filters because Instagram had filters, and a lot of others were trying to adopt filters as well," he wrote. "And you could have said the same thing at the time: 'We're copying each other,' but . . . that's just the way Silicon Valley works. The question is, who executes the best?"
My own company, Later, similarly has features that were inspired by other products in some way. For instance, other companies have tools that are similar to Linkin.bio, Instagram analytics and Search and Repost. As we grew, we knew that we needed to expand our product offering. We also knew that if we could integrate these additional features into our existing platform, the outcome would be more valuable than stand-alone products.
Related: 3 Reasons to Start Copying Your Competitors Today
Hiten Shah, the founder of Kissmetrics, Quick Sprout and Crazy Egg, explained on his website that the trend toward all-in-one software-as-a-service solutions is pushing companies to copy more strategically: "Your product is going to be a suite of tools," Shah wrote, "and that means it'll look a lot like other products."
2. Listen to customers and move when requests hit critical mass.
At our company, we are constantly listening to our customers and collecting their feedback. A lot of the time, they are using competing products and tend to share which features they wished we offered. Listening to them is key, but if you build everything that anyone requests, you will end up with an aimless mess of a product.
Instead, take their feedback and verify their needs. How many people want the same thing? How would that feature work alongside your product's existing ones? Does this feature fit within your vision and strategy?
Related: 6 Steps to Dominate a Competitor's Social Media Marketing
In our company's early days, I learned that many of our customers couldn't grasp how to get the most value from our product. We listened to their feedback and re-evaluated how to communicate our value proposition to better align with their expectations.
For example, we saw several companies with visual planners for their Instagram pages, which streamlined the scheduling experience. After reviewing this feature, we decided there was no reason we shouldn't offer the same thing -- our customers wanted it, it worked well and it didn't interfere with our product goals. Plus, as Instagram co-founder Systrom said, "The question is, who executes the best?"
3. Raise more money to outspend and outsmart.
Depending on where you are in development, raising more money than your competitors can and moving more quickly than they are, are often the best strategies to win.
Fund-raising, for example, creates a ripple effect. Venture capitalists don't back copycat companies when similar businesses already have funding and great traction. Securing more money not only funds your own projects, but also closes the door on others who might compete with you later. It allows you to put space between you and your competitors.
Some companies are prepared for this: Shopify, for one, has a notoriously large marketing budget to try and edge would-be contenders out of the market. Thanks to this strategy, running AdWords against Shopify is pointless -- other companies have to compete via other means.
But Shopify's saturation is its defense; that saturation means that the only way to enter Shopify's market is to provide something it doesn't.
At our company, Later, we have firsthand experience with entering an extremely competitive market. Back at the beginning, there were some very big players with large budgets outbidding us on relevant search ads.
We could still enter the market, though, because we had a unique solution that no one else had: an Instagram scheduler that was Instagram-safe and approved. We were able to capture a large number of people who needed this specific thing. Then, we started to expand, raise money and put more distance between ourselves and our competitors.
4. Never ignore the competition.
You can't ignore your competitors in today's fast-paced markets. The old advice, "Focus on your own business; your competitors will only distract you," no longer applies. In fact, the opposite is true -- we need to look to the competition and try to stay one step ahead of it at all times.
A good example of a company that understands this is Intercom, the customer-messaging platform that offers apps for sales, marketing and support. When Drift entered the scene with products that looked "inspired" by Intercom's solutions, the two companies quickly entered into a rat race: As Drift started winning market share, Intercom copied (and improved on) Drift's best features.
Then, Drift shifted gears to focus on sales and lead generation, and Intercom again followed suit -- not because it is lazy or uninventive, but because the company understands that to compete in the modern world of software, you can't ignore your competitors. You have to constantly stay ahead of them. You may be able to convince your friends that you're better just because you were first to market or have a better "vision" -- but your customers assuredly don't care.
This race is far from over: Both Intercom and Drift have recently released chatbots to improve their customer experience. By paying attention to the competition and making both proactive and reactive strikes, these two companies have learned how to improve their own offerings and establish themselves as industry leaders.
Related: 3 Reasons You Should Spy on Your Competition
Your competitors have good ideas; it's up to you to figure out how to build on their innovations to further your own goals. Follow these strategies to channel your fear of competition into your biggest source of inspiration.
