In the last post, I focused on customer conversations. The post illustrated that asking better questions and capturing answers in a log turns frequent interactions with customers into strategic insights. The log is a lightweight way to surface patterns about what customers were doing, thinking, and weighing before they reached out.
Used consistently, the customer log does more than clarify customer behavior; it changes how you see competition.
When customers explain their decision to reach out, or why they hesitated, you may hear phrases like:
- “I almost tried to do it myself.”
- “I thought about waiting a few months.”
- “I wasn’t sure it was worth it yet.”
- “I was trying to figure it out on my own first.”
None of these phrases reference a specific business. There’s no side-by-side comparison, no feature matrix, no pricing breakdown.
Instead, they point to alternatives. That’s a more useful way to think about competition.
Yes, customers sometimes mention Service X or Product Y. But competition isn’t limited to businesses in your category. It includes anything that can help someone make progress, or delay it.
The goal of this post is to extend customer conversations into a clearer view of your market, grounded in the real alternatives customers consider. By the end, you’ll have a practical way to move from customer conversations to competitive clarity, and from clarity to better decisions about where to focus.
We’ll revisit Jobs to Be Done to frame alternatives as competition, introduce four categories to organize what you’re hearing, and walk through a simple way to translate those insights into an “analysis” of opportunities, gaps, and weaknesses. At the end of the post, we share a template you can use immediately.
If this way of thinking about competition resonates, I share short updates like this as I develop the rest of the series—focused on clarity, follow-through, and sustainable growth for small businesses.
Alternatives as Competition: Jobs To Be Done and Making Progress
In the previous post, we introduced Jobs to Be Done as a way to understand why customers reach out in the first place. People don’t buy products or services because of categories; they “hire” them to make progress in a specific situation. When thinking about competition, this idea becomes even more useful.
If someone hires you to make progress in their life, the real question isn’t, “Who else looks like me?” It’s:
What/who else could they hire to make that same progress?
From a Jobs to Be Done perspective, competition is defined by the job, not the category.
Here’s what that looks like from the perspective of a business owner:
| If My Business Is… | And the Job My Customer Is Trying to Get Done Is… | Then I’m Also Competing With… |
|---|---|---|
| Leadership coaching | Feel confident leading my team and navigating change | An internal HR conversation, a management book, a podcast, peer advice, waiting for the issue to resolve itself |
| Interior design | Make my home feel more intentional | Rearranging existing furniture, buying from a big-box store, Pinterest inspiration, postponing the project |
| Marketing agency | Grow my business | Hiring internally, increasing ad spend, buying a course, trying DIY marketing, delaying until “things slow down” |
When you define competition around the job, the market expands and clarifies. Competitors are all those alternatives a customer considers to make progress in their situation.
That shift is small, but it changes what you listen for and what you do next.
Four Categories of Competition
Looking at the table above, the list of alternatives can feel scattered or overwhelming.
One way to make sense of these alternatives is to group them into a few categories based on how they compete with your business.
1. Direct Competition
Direct competition is the alternatives that look most like you: other businesses in your category, other providers offering similar services, or other tools solving the same problem in a similar way.
This is the type of competition most business owners think about first, and often the only type they consider (and the narrowest view of competition).
Direct competition requires differentiation: How do I make what looks similar feel distinctly more valuable?
2. Substitute Competition
Substitute competition are alternatives that solve the same job albeit in a different format.
If you’re a marketing agency, substitutes might include:
- A course
- A freelancer
- An internal hire
- A DIY template
- A software tool
If you’re an interior designer, substitutes might include:
- A retail store
- An online mood board
- Rearranging what the client already owns
Substitutes don’t look like you, but customers select them as making progress on the same job.
Substitute competition requires reframing: How do I show that what looks different still solves the same job and solves it better?
3. Priority Competition
Sometimes the decision isn’t between you and someone else in your space. It’s between you and something else entirely.
A client may decide between:
- Marketing support and upgrading IT equipment
- Leadership coaching and hiring a new employee
- A home renovation and saving for a vacation
Priority competition has less to do with how well you solve the job and more to do with how that job ranks against everything else in the customer’s life or business.
Priority competition is hard to see if you only focus on the job itself. Understanding the broader context the customer is operating in is required to understand priorities. No feature set can outrank something the customer sees as more urgent.
Priority competition requires repositioning: How do I help someone see this job as more important or urgent than the alternatives?
4. Inertia
Inertia is the most underestimated category of competition. You’ll hear it as:
- “I’ll think about it.”
- “Maybe next quarter.”
- “It’s not urgent yet.”
Inertia wins when:
- The pain isn’t sharp.
- The outcome isn’t clear.
- The effort feels too high.
- The risk feels uncertain.
In many small businesses, inertia is the most overlooked competitor because it disguises itself as simply “not deciding.”
Inertia requires motivation: How do I create enough clarity, urgency, or confidence for someone to act now instead of later?
These four categories won’t capture every nuance, but they are good enough to make the landscape manageable.
With these categories in mind, who is my competition becomes four questions:
- Is this a direct competitor?
- Is this a substitute competitor?
- Is this a priority tradeoff?
- Is this inertia?
That shift makes customer conversations more actionable and sets up the next step: turning what you hear into something you can analyze.
Applying the Four Categories
Let’s take the earlier examples and label the alternatives using these four categories.
This isn’t about being precise. It’s about building the habit of sorting what you hear.
Example 1: Leadership coaching
Job: Feel confident leading my team
| Alternative | Category |
|---|---|
| Another leadership coach | Direct |
| Management book or podcast | Substitute |
| Internal HR conversation | Substitute |
| Hiring a new manager instead | Priority |
| Waiting to see if things improve | Inertia |
Example 2: Interior design
Job: Make my home feel more intentional
| Another designer or contractor | Direct |
| Buying from a big-box retailer | Substitute |
| Rearranging existing furniture | Substitute |
| Spending money on travel instead | Priority |
| Postponing the project | Inertia |
Example 3: Marketing agency
Job: Grow my business
| Another agency | Direct |
| Hiring internally | Substitute (or Priority, depending on context) |
| Buying a course | Substitute |
| Increasing ad spend instead | Priority |
| “We’ll revisit this next quarter” | Inertia |
Turning Customer Conversations Into Competitive Clarity
The real value of these categories comes when you apply them to your own conversations and data.
(If you haven’t, check out the previous post where I explain the customer log.)
Whether you use a customer log or capture notes elsewhere, start by selecting the last five meaningful conversations you had, and whether someone became a client or not.
Instead of focusing only on what they wanted, focus on what else they were considering.
Review your notes for for:
- What they tried before reaching out
- What they were comparing you against
- What almost stopped them
- What they chose instead, if they didn’t move forward
Now, for each alternative mentioned, do two things:
- Label it using the four categories
- Ask what that alternative reveals
This is where “analysis” begins, not in complex data or market reports, but in discernible patterns.
The Alternatives Sheet
To make this process simpler, I recommend creating a document or spreadsheet similar to the customer log. It should look something like the following:
| Customer / Context | Job | Alternative Mentioned | Category | Why It Was Attractive | What This Reveals |
| Leadership team of 12 people | Feel confident leading team | Management book | Substitute | Lower cost, private, self-paced | Some buyers want low-risk trial before deeper engagement |
| Same conversation | Feel confident leading team | “Wait and see if it improves” | Inertia | Avoids confrontation and spend | Consequences of delay may not feel immediate |
A few notes on how to use this:
- Why It Was Attractive forces you to see the logic in the alternative.
- What This Reveals is where insight emerges.
This isn’t about criticizing the alternative. It’s about understanding the progress it promises.
If you want a head start on mapping alternatives from your own customer conversations, here’s a simple template you can copy and use alongside your customer log.
What to Look For
Once you fill this out for several conversations, patterns start to surface.
You may notice:
- Most alternatives fall into one category.
- Inertia shows up more than you expected.
- Priority tradeoffs appear at certain price points.
- Substitutes win when customers want control.
Those patterns point to something practical:
- Opportunity gaps (where customers are underserved).
- Messaging gaps (where customers misunderstand your value).
- Structural weaknesses (where your offer truly falls short).
From Categories to Decisions
Once you can see your competition clearly, decisions become easier.
Differentiate
If most of your customers and non-customers are mentioning direct competitors—businesses in your industry that are like yours—you may need to differentiate your business through features, pricing, brand, etc.
Reframe
If most of your losses are substitutes, your work may be reframing what you offer as the clear choice for a given set of customer circumstances. The goal is to show why what you offer is the best way to make progress for a given job.
Reposition
If most are priority tradeoffs, your work may be repositioning the urgency so that they choice to take action against that competing priority. This requires a bit of understanding of what that other priority is and for which customers you can shift a priority’s ranking.
Motivate
If inertia dominates, your work may be reducing friction and increasing confidence so action is easier than inaction. This may mean improving the business offering or educating folks about the problem and solution.
We will revisit how to differentiate, reframe, reposition, and motivate in a later post.
A Better Way to See the Market
When you define competition narrowly, the market feels crowded. But when you define competition around the job your customer is trying to get done, the landscape becomes clearer as a set of alternatives.
You’re not just competing with businesses like yours. You’re competing with substitutes, shifting priorities, and inertia. And those show up clearly when you listen closely to customer conversations.
The customer log helps you hear those alternatives. The four categories help you organize them. The Alternatives Sheet helps you see patterns.
That’s enough to move from guesswork to grounded decisions.
In the next post, we’ll look at how to turn these customer and market insights into sharper positioning, and how to articulate your value in a way that speaks directly to the alternatives customers are weighing.
For now, go back to your last five conversations and start labeling what you hear.
Competition becomes much less abstract once you do.
If you want help turning these insights into actual posts, Postful is designed to help you translate real customer conversations into clear, consistent content—and publish it where your customers already are.