5 reasons to create a product, despite competition

Let's face it. There are many great equipment/inventory/asset management systems out there. So why are we still committed to, and will still commit ourselves to work on Itefy?

Seth Godin asked in his blog the question: Should I give up? In most cases, there are people who are far more ahead in the game than you are. In business, the same applies with competitors with more customers, more products, more functionality in their software products, and even better functionality.

When starting on a new product or business, I've always been confronted with:

"But there are already companies doing that. It's not a new product".

Implicitly telling me to give it up and do something else. It almost worked, but not entirely. I was probably too curious to find out if I could make it work, than to just give it up.

In some cases, I ended up spending a lot of time on stuff that no one ever used. Some times, it ended up being used by a lot of people, but was never profitable. But you know what? Every time, I learned something. Maybe the hard way, but in a way that I understood. It gave me a gut feeling for the next project, that I would not have had if someone just told me why it wouldn't work.

I few years back, I also learned that compentition is not a bad thing. It's actually a good thing. Profitable competitors with products that are addressing the same challenges as you are, only proves that there is a need for that kind of product. However, if one product is already solving those challenges, what are the reasons there should be more?

1. Niche

"One size fits all" does not always apply. In most cases, solutions specialized for a certain set of needs work better than a general solution. Solutions that works well for a five people bike rental shop, is probably not sufficient for a fifty thousand people oil company, and that huge oil company solution is probably to expensive and complicated for the typical bike rental shop.

2. Flavor

The operating system business is a good example on the matter of flavor. You can usually do the exact same tasks on a Windows PC as on a Mac, or an Android phone versus an iPhone with iOS. Still, the enthusiasts keeps the endless discussion on what operating system is the best, going. The same goes for cars, clothes and most other stuff. 

3. Different directions

When starting my first business, there where always some smart alec who told me to just give it up because there where already other companies offering what I had planned to create. However, unless my plan was to copy another software solution line by line, pixel by pixel, that was simply not true.

My plan was to figure out good solutions to common challenges, starting with the challenges. And that way, the solution might be a little different than what others have made as a solution.

Also, as a software evolve, and with feedback from customers, the solutions normally ends up looking and working a bit different from what the competitors have created.

With Itefy, this has been the plan from the beginning. Although we are aware of what our skilful competitors are doing, our main sources for great solutions is feedback from users and ideas we get when using the product ourselves.

4. Different strengths and weaknesses

As with any product categories, different product has its pros and cons. One product might be cheaper than another, or has a pricing model that is more advantageous for one customer than another. One product might be very good at something that is important for some users, but not for other users. Some customers appreciate great support and perhaps that the supplier is local, while other customers couldn't care less.

When looking at factors like that, it becomes obvious that diversity of suppliers within a single product category is sustainable.

5. Competition strengthens the solutions

"If it doesn't kill you, it makes you stronger" usually applies to competition between similar companies as well. While monopoly might be very comfortable for a company, it's not advantageous for the customers. And in the long run, it makes the monopolistic companies vulnerable as well.
Competition pushes the pricing to a fear level, challenges current ways of doing things and creates disrupted innovation from time to time. 

Conclusion

All in all, there is no point to fear entering or stay in a market with competition. If anything, it's better to have healthy competition than to be alone. And for Itefy, we will continue to do our best to create great  solutions based on the challenges that we see.

Bonus:

Published | By Morten TangerĂ¥s