How should you describe competition in a pitch deck, and why you should focus more on how you solve your target customer’s problems.
When pitching, here are some do’s and don’ts when talking about the competition:
Competition is inevitable. For any great idea, there is likely someone somewhere else in the world with the same idea. Execution is what matters! That being said, I often see pitch decks where entrepreneurs talk about competition. Here are some do’s and don’ts when talking about the competition. In the big picture however, don’t worry much about competition. Focus on solving a big problem for your customers and control what you can control.
Who are your competitors?
I sometimes meet with entrepreneurs who say they have no competition and are the only ones with their solution. While that could be true (but unlikely), they are missing the fact that customers are usually already solving their problem (even if inadequately) in some way. Competition could be pencil and paper or google sheets. There is almost always some alternative you have to sell against to get customers to buy your solution. I like hearing entrepreneurs talk about the different customer profiles in the market, and how those customers currently try to solve the problem. That shows a much deeper level of understanding of the customer problem and market landscape.
How are you different from competitors?
A common slide I see is the “feature checkbox chart.” An entrepreneur lists 10 product features, shows a check by each feature that their product does, and often shows several competitors with all Xs or very few check marks. So of course that looks amazing right … in fact the opposite. First, it shows me they are focused on product features instead of problem solving. Second, not all dimensions matter equally. Instead, tell me what are the 2-3 most important basis of competition for your target customers. Lastly, tell me more about how you solve that problem better vs. you just have an extra feature. I do like the two dimensional axis chart (i.e. automated vs. manual, enterprise vs. SMB, etc.) where entrepreneurs highlight two differing views of competition and plot several competitors on there. That can sometimes better illustrate how you think about the basis of competition.
What do your customers say?
Regardless of what you or I think, what do your customers say? Tell stories of why customers have chosen you over other options during the sales process. Highlight customer reviews or testimonials that describe your basis of competition. Words from customers speak much more than a feature chart on a slide.
So while discussing competition is important, focus more on how you uniquely solve your target customer’s problems versus the alternatives in the market. At the end of the day, keep that customer focus without being distracted by competitive noise and you can build a great business.