Unlike Larry Page, You Do Have Competition

In a recent interview with Wired Magazine, Google CEO Larry Page gave a candid look into his philosophy on competitive strategy… or rather, lack thereof. Rather than putting words into his mouth, I’ll take them straight from the page:
 

I worry that something has gone seriously wrong with the way we run companies. If you read the media coverage of our company, or of the technology industry in general, it’s always about the competition. The stories are written as if they are covering a sporting event… How exciting is it to come to work if the best you can do is trounce some other company that does roughly the same thing?

His message is clear: don’t worry too much about your competition, and shoot for the moon with your products.
I actually do think there’s a place for this philosophy, but it’s in very early-stage startups, universities, and R&D departments like Google X. These fields aren’t expected to be economically viable, so they aren’t as crowded with competitors. They’re also a very small slice of the overall economy.
The rest of us, especially in technology, are attacking very old problems in new ways, which means we still have an abundance of competition.
When Google launched Gmail, there were already a number of email providers. But it also, less obviously, faced a ton of additional competition from traditional media companies jostling for advertising dollars, and old-school telecoms competing for consumers. Without having a great answer to the questions, “why would I place my ad on your website instead of a billboard, TV, or Yahoo?” and “why would I use email instead of snail mail or a fax?” Gmail would never have made it. They did have great answers to both those questions, and that’s why Page is where he is today.
Most startups that I’ve come across resemble Gmail from a competitive standpoint: there are low-tech solutions to the same problem as well as a handful of less mature high-tech ones. But for the rare company that is attacking a brand new problem, any whiff of success and competitors will show up in droves. Google’s self-driving car may not have a whole lot of competition now, but when they start selling them, you can bet Toyota won’t be far behind.
Companies get in trouble when they take Larry Page’s advice literally and act as though they’re a unique snowflake. In a non-competitive market, convincing someone to buy a self-driving car is about convincing them they have problems that the solution will resolve:

• Robots are way better drivers than people
• If your robot does get into an accident, you can sue Google for the damages
• You can get drunk after work and it will drive you home
• You can sleep off your night of drinking during your morning commute

First of all, you’ll notice that even though there isn’t competition in self-driving cars, the messaging still implicitly acknowledges that the alternative solution is the low-tech solution of driving a car yourself.
The status quo is also a type of competition. But it won’t remain your top competitor for very long.
Once Toyota enters the market, the customer doesn’t care that you can sleep through your morning commute if you buy Google’s car. Toyota’s car does the same thing. All they care about is how the two are different:

• Google’s car gets better gas mileage
• You look cooler when you drive it
• Leather seats come standard

Too many companies market as though they’re in the first category and tackling a totally new problem, when what makes them unique and new isn’t the problem itself but their technology and execution. The second category might sound less cool and startupy, but it’s much more effective if your customers realize they have options.
Larry Page and Google X don’t have to worry about competition at all if they don’t want to.
But if I’m those competitors, I’m licking my chops.