Your competition is the wrong measuring stick
How to beat your competitors by focusing on the right metrics and having a (healthy) obsession with your customers.
Competition is a funny thing. It can make founders go crazy. It can turn them into obsessive, win-at-all-costs lunatics. “How much did they just raise?”. “Who did they just hire to run marketing?”. “What did they add to their latest release?”. “Who just offered to buy them? How much?”.
Measuring your company against competitors is an absolute waste of time. Even if you’re in an extremely competitive space, your competition should never act as the measuring stick for your success.
Now don’t get me wrong, I’m not saying you should ignore them. You need a healthy sense of paranoia and should look over your shoulder every now and then — but make it a few times a year, not a few times a week.
What should you use as the measuring stick for your business then? The amount of money you’ve raised? How many times you’ve been mentioned in the press? The number of sales people you have? Your share price?
Of course not.
The key to successfully growing your business is to have a healthy obsession with constantly 1) measuring and 2) improving a handful of metrics that determine the health of your business.
Choose 3 metrics from the list below as your starting point:
- How’s your Net Promoter Score changing each quarter?
- How’s your conversion rate from free trial to paying customer?
- How’s your customer retention or churn rate?
- How’s your revenue growth and profit?
- How long does it take to get up and running with your product?
- How’s your company’s culture? (we can help with that)
It all comes down to a 4 letter acronym, OOTC:
The best businesses in the world do. Think about brands like Apple, Virgin, Zappos, Amazon, Southwest Airlines and Gillette, just to name a few.
Here are some questions to help start your own customer obsession:
- How can you deliver 10x the value to customers, relative to what they pay you?
- How can you improve your product so much that customers feel like THEY are ripping YOU off by not paying enough?
- How can you help solve their problems even faster and with even less work required on their part?
- How can you provide damn-thats-incredible customer service that knocks their socks off every time?
These are all questions worth spending a heap of time thinking about. You can bet that if you have a competitor who is experiencing more success than you, they’ve probably figured out the answer to a few (if not all) of the questions above.
It’s how Uber is beating Lyft. It’s why Apple Music can’t touch Spotify. And it’s why Virgin can dominate almost any product category they enter.
Be the best you can be for your customers and you’ll end up being better than your competitors anyway. True story.
The next time you see a competitor win a big customer, raise a heap of money, release a new product or get featured on your favorite news site, just stop for a minute. Take a deep breath and think: OOTC.
Then get back to work. Create something great. Something your customers will love that you can tell your grandkids about. Life’s too short to obsess over your competition. Obsess over your customers instead.
Get my new book “SANE: How To Build Your Business Rapidly Without Going Insane” at http://www.dontgoinsane.com 📚