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Competing With Existing Products

My company is just about to finish development of our first product. Our idea isn't terrible original, but there are only one or two other players in our niche and we think we can do better. We also added an additional feature or two that the competitors didn't have that we feel adds quite a bit of value. However, we just found out that the our main competitor will be lauching a new version of their product with new features very similar to our own.

Needless to say we're a bit discouraged. We think our product does a lot of things better, but it's very similar to existing products that have had more time to mature.

What should our top priority be at this point? Find some new features that give us a clear competitive advantage? Work on refining our existing product and feature-set to a level beyond the competition? Any advice would be helpful.

Sam Thomas
Saturday, March 06, 2004

Stop paying attention to your competitors. Repeat after me:

Listen to your customers, not your competitors!
Listen to your customers, not your competitors!
Listen to your customers, not your competitors!

There are dozens of competitors for our bug tracking software and I have no idea what they do or why they're better or worse than ours. I couldn't care less. All I care about is what my customers tell me, which gives me plenty of work to keep busy.

Ship your thing, ignore the competition. You're going to get some customers who just haven't HEARD of the competition. Maybe not a lot, but it's a start. Talk to your customers regularly and make sure there's an email address on every page of your web site. You'll start to notice trends ... features that keep coming up which explain why some people are not choosing your products. With FogBUGZ 1.0, it was the ability to attach files to bugs. We added that for FogBUGZ 2.0. Do our competitors have that feature? Beats me, I have no idea. It's not worth the ten minutes it would take to find out. All I cared about was that people were telling us that they wouldn't buy our software until you could attach files to bugs. So now you can.

Strategy Letter III has some discussion of understanding the business of getting users to switch from an entrenched competitor:

http://www.joelonsoftware.com/articles/fog0000000052.html

But for now your action item is to ship, then listen to your customers and almost-customers to figure out what to do next.

Joel Spolsky
Fog Creek Software
Saturday, March 06, 2004

Primary Action Item... <g>

Does not paying attention include initial features?  Did you research any competitive products during design?

I did, should I feel shame?

B#
Saturday, March 06, 2004

If your competitors have a messageboard, you might want to browse through it a bit. Often there is a "feature requests" area. Though these forums often just contain weird stuff that one or two users might want, you may see stuff that is requested by many and makes sense.

Browsing help forums/mailing list archives/newgroups in general will give you an idea which features are the most popular etc.

Eric Debois
Saturday, March 06, 2004

" We added that for FogBUGZ 2.0. Do our competitors have that feature? Beats me, I have no idea. "

Yes.
So now you know. Furthermore, it's tremendously important.

old_timer_at_home
Saturday, March 06, 2004

Seems that if some due diligence were done (i.e. examining what the competition had already done), file attachments could have been added to FogBugz 1.0 instead of FogBugz 2.0, thus making for happier 1.0 customers.

Not a bad way to "waste" 10 minutes, if you ask me.

Mr. Nobody
Sunday, March 07, 2004

Trouble is if you delay release to add features then if the competitor is doing the same he will delay too - add some extra features and so on - the thing will never get shipped by either of you - you got to get it shipped then be ready to start working on it again once you get some user feedback. I would tend to agree with the last comment though - it might have been worth looking at other products initially to get some of the ideas they have that you might not have thought about but which are essential.

Fothy
Sunday, March 07, 2004

This is a really important point.

Version 1.0 doesn't have to be perfect. The sooner it's out, the sooner you can figure out what's next. Even when you think you know what should be next, even when you'd stake your life that you know... you don't know, because you don't have customers yet.

I've seen enough of this to know that it's right. Get something out as quickly as possible, then start figuring out whether you got it right or not.

Brad Wilson (dotnetguy.techieswithcats.com)
Sunday, March 07, 2004

You might find this article interesting :

http://software.ericsink.com/Choose_Your_Competition.html

Serge Wautier
Sunday, March 07, 2004

Interesting. So it seems Eric's view of things differs from Joel's. Eric is saying "choose your competition carefully" while Joel seems to be saying "ignore your competition completely".

It seems to me the most important thing is to develop a product that your team can execute succesfully on, but I can't imagine entering into a market without first assessing the strengths and weaknesses of your future competitors.

greg
Sunday, March 07, 2004

It is possible that customers or even prospective customers will tell you, "Hey, Company X's Product Y has Feature Z and your Product Q doesn't.  I like the look and feel and price of Product Q, but that Feature Z is really a deal breaker for us here at Company N.  I could convince my boss to buy Product Q if you would only add Feature Z."  If Feature Z shows up enough times, you add it.  Enough times might even be only once if they are placing an order for a 100 seat license.

Now, I'm not sure if that's how Joel does it or not, but if I were basing a product solely on customer input, that's how I would do it.

However, one thing that's missing in this discussion is the fact that Fog Creek dogfoods - they are their own first customer.  They have to have a pretty clear idea of what they want the product to do for their own purposes, and they code to that first.  When Joel says he listens to customers, I think he's including Fog Creek in that list.

Aaron F Stanton
Sunday, March 07, 2004

That's a very good point, one I over=looked!

B#
Sunday, March 07, 2004

Serge & greg, Eric Sink is talking about using telemetry about customers to choose what product to build.

Joel is talking about what to do once you've chosen a product and are in the process of delivering it.

I don't think Joel is advocating the idea of building an operating system, or a web browser, or even an Outlook competitor, without giving serious thought to the competitive implications. He's just saying that once you've chosen a direction, you will get better information from customers actually using your stuff than you will from the actions of your competitors.

I don't agree with that statement, but it's not contradicting Eric Sink's.

Thomas H. Ptacek
Monday, March 08, 2004

I wouldn't necessarily say Eric's take is all that different from Joel's.  At the end of the article he says:

"Make sure that one particular niche of your market segment has a very good reason to favor your product over the more established competitor.  Make the people in this niche love you.  Until they do, you can ignore the rest of your market segment."

I this is basically what joel was getting at.  When deciding whet to develop, you should know your potential competition and do all kinds of research, but once you are in a market, you better pay more attention to your customers than your competition.

ken
Monday, March 08, 2004

Did anyone hear of F.W. Lanchester?

Aside from good advices how to attack enemy airplanes,
he's got a theory that small guys need to compete with
established major players where big players are weak. Like,
excel where your competition sucks. End if you become
major player, all you have to do is imitate what innovators
are doing.

Seems like in both cases watching competition and making
your moves in accordance is very important.

In other words, do what Microsoft was always doing.

VPC
Monday, March 08, 2004

If you're using your competition to guide you, then you are always, by definition, playing catchup.


BTW, Michael Dell talks about this extensively in his book (Dell Direct, I think).

It's like a chase. You chase the competitor who (may be) chasing the customer. You can slip around the competitor by running straight for the customer.

And remember, competitors make mistakes.  I've been worried (needlessly) on several occasions about competitor's new features then when I considered implementing those myself I realized "that'd dumb. Expensive and no one really wants that feature"

The real Entrepreneur
Wednesday, March 10, 2004

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