TL;DR
- Most teams are not aligned on who they compete with. Each function carries a different bias.
- The buyer's alternative is the only one that matters. In B2B, that is often the status quo or no decision, not a named SaaS rival.
- Different competitors require different positioning playbooks. Beating a SaaS rival is not the same job as beating manual processes.
- The fastest diagnostic is simple: look at the last 50 closed-lost deals and categorize what buyers actually chose instead.
Ask marketing, product, sales, and the CEO who the main competitor is and you will often get 4 different answers.
Marketing will name the loudest brand. Product will name every tool in the space. Sales will anchor on a few memorable lost deals. Leadership may talk about the future category they want to own. None of those answers are automatically wrong. They become dangerous when one of them quietly becomes the company's positioning strategy.
The actual competitor is not the one that feels most vivid internally. It is the option the buyer most often chooses instead. In B2B, that is frequently not another software vendor at all. It is the status quo, a spreadsheet, an internal build, or no decision.
If the company is positioned for the wrong fight, it will run the wrong content, the wrong events, the wrong battle cards, and often the wrong sales motion. That is why competitor clarity is not just a messaging problem. It is a structural one.
The 4 Functional Biases That Distort Competitor Choice
Most internal confusion comes from predictable biases by function.
1. Marketing overweights visibility
A competitor with more events, more ad spend, and stronger social presence feels like the obvious threat even if buyers rarely mention them in deals.
2. Product overweights possibility
Product teams often track the full landscape, including tools that are technically adjacent but do not materially appear in pipeline. That is useful for horizon scanning. It is not always useful for current positioning.
3. Sales overweights memorable losses
One big enterprise loss can distort competitive worldview even if it represents a small fraction of the overall pipeline. Sales remembers pain vividly.
4. Leadership overweights narrative
Founders and executives often position against the future category they want to define. Buyers, meanwhile, are still deciding whether to replace a spreadsheet or keep doing nothing.
Use lost-deal reality before you build the next battle card.
The positioning work is strongest when the company needs a sharper read on who the real alternative is and what kind of fight that creates.
Why the Status Quo Is Often the Real Competitor
Many B2B companies build positioning as if the core fight is head-to-head SaaS displacement. The data often says otherwise.
If a large share of closed-lost deals end in no decision, the buyer is not choosing a named competitor. They are choosing inertia. If deals repeatedly go back to spreadsheets, manual workflows, internal ops work, or a contractor, those are the real alternatives.
That distinction matters because the playbooks are different. Positioning against a SaaS rival emphasizes feature differentiation, migration, and comparative proof. Positioning against the status quo emphasizes the cost of inaction, hidden operational waste, risk, and why the current workaround is already expensive.
| If buyers choose... | Your positioning should emphasize... | What to avoid |
|---|---|---|
| Named SaaS competitor | Differentiation, migration logic, proof of advantage | Broad thought leadership disconnected from comparison |
| Status quo or manual process | Cost of inaction, ROI, risk, workflow pain | Feature-heavy battle cards as the main message |
| No decision | Problem urgency, timing, buyer confidence | Assuming more brand awareness fixes the issue |
| Internal build | Hidden complexity, maintenance cost, speed-to-value | Treating it like ordinary vendor displacement |
Positioning only works when the target is correct. Clever messaging aimed at the wrong competitor is still strategically weak.
How to Find the Real Competitor in 30 Minutes
You do not need a quarter-long research program to get a better answer. Start with your own lost-deal data.
- Pull the last 50 closed-lost deals. Use a set large enough to smooth out one-off anecdotes.
- Sort each deal into 4 buckets. Named SaaS competitor, status quo/manual process, no decision/timing, or internal build.
- Calculate the percentage in each bucket. This is the fastest way to stop arguing from memory.
- Compare the result to where marketing and sales are spending effort. If the effort map and the lost-deal map do not match, positioning is probably off.
- Then check Product DNA. A niche specialist often competes more with the status quo than with a broad-category vendor. A differentiator in an established market may need the opposite playbook.
The point is not to eliminate nuance. It is to stop averaging 4 conflicting internal stories into a positioning strategy that does not describe any real buying situation clearly. Once the company sees what buyers are actually choosing instead, the right narrative becomes much easier to build.
Positioning gets much cleaner once the competitor is real.
If your positioning feels broad, generic, or split across too many fights at once, the company probably has not aligned on what buyers really choose instead.
Different Competitors Need Different Playbooks
One reason this matters so much is that the wrong competitor quietly creates the wrong GTM system. If the real fight is against a named SaaS rival, the company needs sharper differentiation, migration stories, and competitor-specific proof. If the real fight is against spreadsheets or no decision, the company needs urgency, ROI framing, and problem education.
Those are not minor message tweaks. They change content strategy, event selection, sales training, and even rep fit. Positioning against the wrong target means the company can execute well and still feel ineffective because the whole playbook is pointed at the wrong fight.
FAQ
What if we compete with both a SaaS vendor and the status quo?
That is common. The important question is which one dominates the actual lost-deal pattern. The primary competitor should shape the primary message.
How many closed-lost deals do we need before this becomes useful?
Even 20 to 30 deals can reveal a pattern, but 50 is usually enough to reduce anecdotal bias materially.
Should product teams ignore horizon competitors?
No. Horizon competitors still matter for product strategy. The mistake is letting them drive near-term positioning if buyers are not actually choosing them yet.
What if most deals are no decision?
That usually means the positioning needs more problem urgency, economic justification, or buyer confidence rather than sharper feature comparison.
Sources
About the Author
Jake McMahon writes about the structural layer underneath SaaS growth: positioning, category framing, competitive reality, and the way GTM gets distorted when companies fight the wrong battle. ProductQuant helps teams aim their message at the alternative buyers actually choose.
This article is part of the Product DNA series and is designed to connect positioning to lost-deal evidence, not just messaging taste.
Find the real alternative before you sharpen the message.
If positioning feels vague or split, the company is probably still arguing from internal bias instead of lost-deal reality.