Second week of an audit, a client's VP wrote three logos on the whiteboard and capped the marker. Those are the competitors. All three had been in the same trade publication that spring. Two of them had raised money recently.
Then we went and talked to eleven of their customers, including four who had evaluated the product and bought nothing.
Not one person mentioned a logo on that board.
What they mentioned was a spreadsheet somebody built in 2015 that basically works. A guy on the team who already knows how to do it. A cheaper tool bought for something else entirely and quietly stretched to cover this. And, most often, simply not solving the problem this year, because the problem was annoying rather than urgent and the budget cycle was tight.
Your competitive set is not the companies you are benchmarked against, it is the full list of things a customer could plausibly do instead, and the largest entry on that list is almost always nothing at all.
Trade press competitors are seductive because they are legible. They have positioning you can put in a grid. They show up at the same conferences, they hire from the same pool, and beating them feels like a scoreboard you understand. Comparing yourself to a spreadsheet feels undignified, so nobody does it, so the spreadsheet keeps winning.
Reed Hastings said last year that Netflix competes with sleep, and everyone treated it as a clever line. It is not clever, it is an accurate description of the frame of reference. Stumptown is not primarily fighting other roasters, it is fighting the pot of coffee already made at the office for free. Salt & Straw is fighting the pint in your freezer and the general inertia of a Tuesday evening in the rain.
Comparing yourself to a spreadsheet feels undignified, so nobody does it, so the spreadsheet keeps winning.
The fix is not complicated, it is just uncomfortable to run. Ask buyers what they were doing about this problem the day before they found you, and write down the answer in their words. Ask the people who did not buy the same question. Then build your competitive set from those two lists rather than from the analyst report, and rank the entries by frequency instead of by how impressive they are to name in a board meeting.
What you usually discover is that your positioning is aimed at a rival almost nobody was considering, and it is silent on the alternative almost everybody was. That silence is expensive. It is also the cheapest thing on the list to fix, since it costs a message rather than a roadmap.
I am writing this at Ovation with a four dollar cup, and there is a perfectly good French press at home that lost this morning for reasons that have nothing to do with coffee.