Almabrands’ Talk at EtMday 2024: “How to Make the Competition Irrelevant”

Almabrands’ Talk at EtMday 2024: “How to Make the Competition Irrelevant”

Almabrands is committed to the Chilean entrepreneurial ecosystem. That’s why, from Thursday, November 21, through Saturday, November 23, we participated in EtMday 2024, the largest networking event in Latin America, where innovative ideas, industry leaders, and major business opportunities come together.

As part of the event, one of the activities that drew a large crowd—over 150 people—was the talk and workshop led by our founding member, Carolina Altschwager, whose thought-provoking title, “How to Make the Competition Irrelevant,” captivated the audience.

Using a practical and participatory approach, Carolina Altschwager shared key tools and insights to help companies stand out and remain relevant. Here are some interesting takeaways:

“Given how many years we’ve been in business, I think we need to view the competition with great humility, but also with a mindset focused on learning—and that’s where the opportunity for entrepreneurs lies. Looking at the competition is a creative act that allows us to discover what we can do better and differently.”

“The challenge isn’t to compete; it’s to be relevant in a world where everything is competing for our customers’ attention.”

Competitive Environment

Defining a company’s strategy requires considering three fundamental elements, he said: identifying the competition, the customer, and the project itself.

Competition should not be viewed in a narrow sense, but rather as a broad spectrum that includes indirect players. For example, television channels compete not only with each other, but also with streaming platforms, social media, and even amusement parks and shopping malls, all of which capture people’s time and attention. Understanding this landscape allows us to discover new opportunities to stand out.

A common mistake is failing to correctly identify the competition. Examples such as Blockbuster illustrate how a narrow focus on a specific format (renting videos) proved detrimental in the face of innovative players like Netflix, which viewed its business as “access to entertainment content.” Similarly, companies like COPEC expanded their offerings by analyzing their customers’ transportation and food needs, thereby creating a more relevant value proposition.

“What Pronto COPEC did was understand how people get their food, how they meet their transportation needs, and even their basic needs in the city or while traveling throughout Chile. And that’s what led them to the offerings they have today.”

In addition to analyzing the competition, it is vital to have a thorough understanding of the customer or consumer. This involves identifying their needs, desires, and how they engage with the category in which the company operates.

On the other hand, companies must reflect on their own mission, highlighting what makes them unique and leveraging their “capital.” This approach allows them to create a sustainable competitive advantage and adapt to the opportunities the market offers.

Of course, keep in mind that the competitive landscape is constantly changing. This means staying on top of how product categories evolve, as seen in the case of potato chips, where variety and sophistication have grown exponentially.

Compete on the basis of preference or relevance

Defining a clear competitive strategy is crucial. Here, Carolina Altschwager echoes David Aaker, noting that there are two main ways to compete (in simplified terms): “by preference” or “by relevance.” Although both are valid and can coexist, they respond to different objectives and methods that impact consumer perception and brand positioning in different ways.

The preference-based strategy focuses on demonstrating that a brand, product, or service is better than the competition’s in specific areas. It seeks superiority in category attributes—such as speed, price, service quality, or even intangible values like happiness, as Coca-Cola does. The key lies in building a differentiation that is sustainable over time, which requires consistency and innovation to maintain leadership in the defined attributes. Classic examples include Volvo, which stands out for its safety.

On the other hand, the relevance strategy does not aim to be the “best” within an existing category, but rather to create a new space in the consumer’s mind. This approach focuses on redefining the rules of the game by introducing categories that transform market needs. One example is energy drinks, which shifted the perception from “quenching thirst” to “getting energy.” Here, innovation is not merely marginal; it must be transformative to establish a unique consumer space that renders existing competition irrelevant.

Both strategies have their merits and challenges. While competing for preference requires maintaining differentiation from established rivals, competing for relevance calls for a creative and bold vision to identify and develop new categories. The key question for any business is which of these strategies best aligns with its capabilities and objectives, and how it can implement it to stand out in a saturated market.

Our speaker and co-founder of Almabrands concluded by emphasizing that creativity and openness are essential for turning challenges into opportunities and making a significant difference in the market.