SaaS Competitor- Should they scare me away?

[joshy]

I have been working on a SaaS product for a market that is relatively small and the target user is very specific. Think product that only a plumber could use for his plumbing business because it fulfills a specific plumbing business need, versus a product that appeals to any small business owner. Because of this, my audience is small. There are about 1,500 potential users in my state, for example. However, the product is critical to these users' running their business.

When the idea was first developed, the only competitors I found were a handful of terrible, clunky solutions. The industry was not innovating (from what I could find) and it needed a shakeup.

Went to work on this as a side project. Had an industry insider guiding some of the product decisions and advising a bit. Progress was slow for various reasons and we had some setbacks.

While the beta was being built I discovered a competitor across the country. We had kept our ear so close to the ground locally that we didn't notice them. And it turned out they were a couple of years ahead of us. When I discovered them I just couldn't believe it. They had built what we were building. I was pretty discouraged. It was almost eery the similarities in what they had built and what we were building. We kept building.

I've kept a close eye on this competitor and they get rave reviews and are growing at an impressive rate. The older competitors we were excited to crush are losing market share to this new competitor. I think I've found 1 bad review and it sounds like a miscommunication on the user's end. People are worshipping this new company. I can dive into forums and FB groups daily and see more and more users switching to these guys. People who have been loyal to a different product for years are switching and "never looking back".

Now, we are close to finishing up a beta version. Have an email list of about 40 potential users and have influence in the industry circles locally. People who know us and people we've built relationships with.

Compared to this competitor, we have a LONG way to go. I just can't help feeling that we're too far behind. Especially since the market is small and many of the pain points we were tackling have been relieved by this new company.

I feel like I've been working on a product to compete with SEMrush and then Ahrefs reared its ugly head.

 

[Olov]

I "just" make affiliate websites, so I've never actually sold a software or hardware product myself. So take my advice with a grain of salt.

However, I think you might be too hard on yourself. First of all, don't give up all the hard work you've done so far. You don't know for sure that this competitor will dominate the market to 100%. Most likely that's impossible.

Even if the reviews are great, there is always something you can improve and do better. Provide faster delivery, customer support or lower prices. Market your product better than your competitor. Create a better, faster and more easily navigated website. Start doing outreach to plumbing companies giving them a good offer, so that they at least have to try your service out.

This competition is, without a doubt, lacking in some department that you can beat them in.

I understand that you are feeling down as you "missed" this competition, but remember that they are not perfect. Try their service and see what it's like. Put yourself in the customers shoes. What could be improved? What was good? What was bad? Apply it to your business.

You can do it man!

 

[darkzerothree]

Tough.

Take a hard look at what they are doing. Spend the money and subscribe to their software.

- What is good, what is bad?
- Dive into their forums. What features do their users REALLY use?
- What features are never mentioned?
- Which features are hated?

And build on!

 

[Ryuzaki]

Imagine if everybody just pussed out and went home after they had the idea for a vehicle with an engine instead of being horse drawn, and then they realized Ford was already on it.

Imagine if Windows and Apple closed up shop because Xerox already made a GUI for their operating system.

Imagine if SERPWoo didn't launch because there was already a bunch of other research and tracking solutions? Instead they revolutionized tracking with a unique concept and forced everyone else to pivot and copy them. Everyone else suddenly became years behind instead of years ahead.

Imagine if BuSo didn't launch because other forums already existed. Instead it's focused on quality and higher expectations from users. Now it cuts through the noise.

Imagine if (every single vertical, every single niche, every single competitor, every single business, every single website)...

It's super easy to erode someone's marketshare. They'll piss some irrational person off who's looking to be pissed off because they're busy bodies, and that person will become your first evangelist marketer who will give you good reviews just to frustrate the other company. You'll be equally as good and there will be a portion who want to procrastinate so they check out your service and stick around. You'll do marketing in channels that the other company isn't and scoop up customers before they learn of the other company. The market size will grow and so will your marketshare. You'll come up with unique ideas that become unique selling propositions and will gain a ton of users before the other company copies you. You'll go back and forth, maybe settle out at 50/50, and then some new hotshot will show up and it'll become 40/40/20.

Who knows, but there's zero reason you can't COMPETE. If one single competitor is enough to make you give up, I've got bad news for you. There's very few untouched niches unless you can invent one.

I agree. You can do this. But you have to be committed not to only the build and customer service, but to the marketing, the optimization for retention rates and reducing churn, etc. There's not going to be a single moment where it's not fierce work with fierce competition.

 

[CCarter]

Man come on guys, where the fuck is your killer instinct?

If there is ONE competitor you are thinking about folding? Seriously? It's like you want a participation trophy for simply creating. If there is a competitor it means there is a market. It means there is someone to compete against and take on. It means you can go for the kill and take away their customers by being better than them.

If there was NO competition then you literally would have to convince people to pay you for your service that no one has ever heard of. You know how infinitely harder it is to sell an idea that never existed to people - creating a market?

Think about it - there is a market for sawdust. You know what sawdust is? It's the shit on the ground that's leftover when you cut wood. Someone came up with the idea that "I could sell that". And he fucking did it, but he had to come up with a use case scenario to create a market for sawdust. And now other people see how profitable it is and are turning wood into sawdust on purpose!

So it wouldn't matter if you are #2 or #1 to the market, cause as soon as someone sees you generating revenue they'll think "I can do it better" and boom you'll have a competitor sooner or later. And if they market better than you, have better customer service than you, and/or can out maneuver you you'll be dead no sooner or later anyways.

The market doesn't give a shit if you are first, thirteenth, or hundredth and one. As long as you can provide a better product/service you'll win market share. But lets say you can't - you think people are going to hand over their hard earned money to you as a form of a participation trophy?

Dig deep down and get ready to go to war!

 

[Boy]

Bro... I launched a free web service in January, knowing that it's largest competitor has been around for 20 years and is essentially the industry service of choice. Then there are 7 others in the space I can name right now that have been doing what I just started this year for a number of years.

Still didn't prevent me from making $1k this month. On a free service, with the option to pay for features.

 

[Zach]

A product where you only have 1 emerging competitor that does a good job and all the others suck? Sounds like opportunity...

 

[Erayz]

Every product needs an alternative, no matter how good.
Find/develop a point of difference and push it hard.
Maybe look at a freemium model as above too.