Who wouldn’t want less competition in the market?
How easy everything would be.
You could charge much more.
Clients would stick with you longer, maybe forever.
And you’d grow like there is no tomorrow.
It’d be a dream come true for every executive.
Well, there are ways to reduce your competition legally.
The obvious option is to buy them out.
But that’s not possible for most companies.
And you can only buy so many of them.
So leaving that out, there are two ways.
The first is by reducing your target market.
In other words, getting more specific with who you target by sacrificing some client types.
The moment you say you target “consumer fintech” companies, you stop competing with businesses that target healthcare, hospitality, or manufacturing.
Hundreds of thousands of competitors, gone in a second.
The second way to reduce your competitors is by reducing the services you offer.
The logic is the same.
If you only offer “pricing strategy for consumer fintech apps,” you don’t compete against compliance, UX, or IT consultants who also target consumer fintech businesses.
So get specific on your who and what, you escape millions of competitors overnight.
Framing specialization as reducing competition makes its importance more obvious.
But executives still have a common doubt when it comes to actually doing it:
“But we are also reducing the number of businesses that can buy from us.”
And that’s correct.
Getting specific with your who and what also reduces the number of total businesses that can buy from you.
But that’s the whole point.
We talked about why narrow positioning doesn’t mean going small.
Because that specialization raises the value you create for specific client types.
Hence your overall conversion rate and pricing power go up.
Without any specialization, maybe 50,000,000 businesses could buy from you.
But you could hardly convert any of them with a generic positioning like “marketing for businesses.”
Plus, you’d have no pricing power as millions of competitors offer the same thing.
When you specialize in “pricing strategy for consumer fintech apps,” you reduce your total market to maybe 50,000 businesses.
But now you only have a few competitors.
Your overall conversion is much higher because you can get specific with your messaging and offer.
So you can charge much more.
In a way, you get away from perfect competition.
And suddenly, your firm behaves more like a monopoly.
That’s why you should also do extensions carefully.
With every new client type and every new service you add, you also add new competition.
Buyers start comparing you to new alternatives.
So if you must grow by extension, it’s a good idea to expand only in one dimension at a time.
Either a new “who” or a new “what.”
It’s never wise to go against too many new competitors and lose your edge.
Remember the Bowling Alley Strategy.
But the moral of the story?
It’s possible to reduce your competition legally.
And it’s through specialization.
By getting specific on your target “who.”
And by getting specific on your “what.”
That way, you don’t struggle trying to out-compete everyone.
You just out-focus them.
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