Your biggest competitor is obscurity
Do you know who your biggest competitor is? It might not be as straight forward as you think. Let’s use FreshBooks as an example. You probably think QuickBooks is our greatest competition. They’re not. Our greatest competition is obscurity.
Despite our success over the last 5 years, virtually no one knows they need online invoicing because it’s a new concept, and the truth is pretty much no one on this planet has ever heard of FreshBooks. The lesson here is that when you are a small company doing innovative things, don’t spend time thinking about your competition – focus on getting the word out. Eric Karjaluto writes a great post about why startups fail. It’s not because of the incumbants, it’s because they don’t get the mind share and attention they need to survive.
The bottom line is that you need to fight to be heard. You don’t need to focus your energy on the 800 pound gorilla, though many startups make that mistake. If there is an 800 pound gorilla, then they’ve proven there is enough market to go around, and its not them who you are losing to. And if that’s true, it’s the fact that no one knows about you that’s standing between you and success.
So get out your fog horn and make sure the world knows all about you, and while you’re at it, feel free to mention FreshBooks – we’ll take all the help we can get. 
Copyright © 2000-2009
2:17 pm
This is great advice! I’ve often wondered why good ideas don’t take off.
Social media can help change this in a price-efficient way.
-Josh
6:54 pm
Online invoicing is sure new concept but do businesses really need it? I don’t want to be negative but most businesses don’t need online invoicing otherwise everybody would know about Freshbooks by now…
Did people need good search engine like Google? Sure they needed, that’s why after 5 years whole world knew about them. The same thing we can say about Facebook and so on.
You need to solve a problem that whole world needs to be solved and frankly, online invoicing is not solving any problem.
Once you start solving problems, then you are onto something, until then, you’ve got nothing. That’s my piece of advice.
10:41 pm
I hear ya. Smart businesses don’t slander their competition and recognise that mutual growth is beneficial to both of their bottom lines.
Second Cup might not welcome Starbucks into their neighbourhood but at the end of the day, more customers are buying premium coffee, which is good news for both.
Good on you guys with extending your API, it is all about having confidence in your product and being open to sharing it.
1:08 pm
Great post and so true.
8:47 pm
[...] this post from the FreshBooks folks today: Your biggest competitor is obscurity Do you know who your biggest competitor is? It might not be as straight forward as you think. [...]
9:41 pm
“Marketing” is usually the weakest part of any business plan. There is always a much larger “business” that needs to surround the “product.”
The scope of most new entrepreneurs simply focus on the product … but I guess that is how it all starts.
9:06 pm
Thank you for linking to ideasonideas – went & read that post. So much of it parallels my own experience – both as an observer of and participant in – the startup world.
I’m signing up for freshbooks tonight. Rock on.
12:52 am
I agree with the post.
I also feel like the lack brand power is also a big obstacle for new businesses. It’s hard for good content or a good product to tip if the person behind it is not well known etc which gives them leverage.
So because of that, I feel like people try to copy their competitors. However, doing what the big guy does to market themselves may not be appropriate for you. Overall, start-ups need to recognize their position in the market and market themselves from that unique position.
Cheers
12:51 pm
I think the post is very general in scope in its statement, staggering between marketing and an internal management solution. Online invoicing is a somewhat new concept and there is a growing demand for it. It is of greater benefit to certain or more specific revenue models. A firm utilizing a recurring revenue model or that has a vast product offering with mixing and matching services, will certainly find more benefit in an online billing and payments management system. Implementation of such a system will indeed solve problems such as cutting operational costs, creating efficiencies and streamlining operations. All of these outcomes lead to an increased bottom line….problem solved!
1:13 pm
wellcom
2:07 pm
Well said, Mike!
I adopted an online billing solution a few years ago, and have loved it since Day 1. But I think I am unusual, because of how little I knew about the subject at the time, and how fanatical I have always been about the cloud even before it was called the cloud. (I was an early adopter of efax technology, was one of the first to dump Outlook for “all web-based email client, all the time, for all my POP accounts,” etc.
A lot of people “know” too much about invoicing. So they’ll use the 800 lb. gorilla.
And those that know very little about it may not know exactly what it is they should be looking for.
Somehow this is all about reaching that second group, not the first.
2:53 pm
A market is always comprised initially of early adopters – those ahead of the curve who get in early because they understand their need for the product and how it will benefit them. At this stage a company really needs to focus on gaining recognition whilst keeping its’ customer happy.
I understand that 98% of Freshbooks users recommend the product to their friends and colleagues. That is a fantastic achievement for Freshbooks that should be applauded.
The product is still in the early adopter stage though, the next couple of years will really see a move towards online and net-based applications as people seek greater savings and reduced overheads, and more people begin to generate revenues online.
I see Freshbooks becoming a mass adopted product within this timescale, as exponential growth is seen – providing the product stays as good, the customers remain joyous and the marketing allows the word to spread and the sales funnel to grow.
Rob
11:06 am
[...] Obscurity. [...]