Stop Copying Competitors (They're Probably Wrong)

“If you want something new, you have to stop doing something old.” — Peter F. Drucker

The Business World’s Most Dangerous Strategy

“What are our competitors doing?”

This seemingly innocent question is perhaps the most dangerous one in business. It begins innocently enough—a reasonable desire to understand the competitive landscape. But it rarely stops there. It morphs into a pervasive copy-paste mentality that undermines the very distinctiveness that creates market gravity.

In boardrooms and strategy sessions around the world, teams pore over competitors’ websites, dissect their features, and reverse-engineer their business models. They create competitive comparison spreadsheets, conduct SWOT analyses, and plot market position matrices.

All of this analysis might seem like diligent strategic thinking. But lurking beneath is a dangerous assumption: that the path to success lies in replicating what successful competitors are doing.

This assumption has created industries full of companies that look remarkably similar, say remarkably similar things, and offer remarkably similar experiences. Most businesses invest tremendous energy trying to be slightly better versions of their competitors, rather than becoming distinctly themselves.

The problem? When everyone follows the same playbook, the game becomes predictable. And predictability is the enemy of attraction.

The Context Fallacy: Why What Worked for Them Won’t Work for You

The most obvious problem with copying competitors is the context fallacy—the mistaken belief that what worked in their specific context will work in yours.

When Monzo disrupted the UK banking industry with its digital-first approach, countless fintech startups rushed to create similar offerings. Most failed spectacularly, not understanding that Monzo’s success stemmed from a unique combination of timing, market conditions, founding team capabilities, and regulatory factors that couldn’t simply be transplanted to different contexts.

The context fallacy manifests in four crucial ways:

Different Market Context

Your competitors operate in a market space with specific dynamics that may differ substantially from yours. Perhaps they entered earlier, when customer acquisition costs were lower. Maybe they’ve built network effects that create defensible advantages. Or they might serve slightly different customer segments despite surface similarities.

When ClassPass launched its fitness subscription model, many independent gyms and studios tried to copy their approach without recognising the fundamental difference in positioning: ClassPass succeeds by aggregating excess capacity across numerous providers, while individual studios can’t create the same value proposition on their own.

Different Internal Capabilities

Every company has a unique set of capabilities, resources, and limitations. Your competitors’ strategies likely emerged from their specific strengths—capabilities you may not possess in the same measure.

Attempting to copy Apple’s integrated hardware-software approach without their design capabilities, manufacturing expertise, and ecosystem advantages is a recipe for failure. Microsoft learned this the hard way with products like the Zune and original Surface devices, which attempted to mimic Apple’s strategy without the underlying capabilities to execute effectively.

Different Timing Advantage

First-mover, fast-follower, and late-entrant strategies each have distinct advantages and challenges. A strategy that worked perfectly for a company that entered a market in 2015 may be entirely wrong for one entering in 2025.

When Instagram introduced Stories to compete with Snapchat, their timing and market position enabled success. When Twitter launched Fleets years later, the same feature fell flat—not because it was inherently flawed, but because the timing advantage had evaporated.

Different Essence and Authenticity

Perhaps most importantly, your competitors’ strategies emerge from their unique essence—that irreducible “why + how” that drives their approach. Copying their visible expressions without sharing their underlying essence creates an authenticity gap that customers quickly detect.

When traditional banks add “digital innovation labs” and adopt startup language in an attempt to compete with fintech disruptors, they often create disconnected experiences that feel inauthentic rather than truly transformative. The visible strategy doesn’t match their operational reality or cultural essence.

The Danger of Backward-Looking Strategy

Beyond the context fallacy, competitor copying creates another significant problem: it guarantees you’re always looking backward rather than forward.

Consider the cautionary tale of Blockbuster. When Netflix emerged with its DVD-by-mail model, Blockbuster eventually responded by copying this approach. By the time they’d implemented their version, Netflix was already pivoting to streaming. Blockbuster again followed, but by the time their streaming service launched, Netflix was investing heavily in original content. This pattern of perpetual following eventually led to Blockbuster’s demise.

This backward-looking approach creates four compounding disadvantages:

Perpetual Follower Status

When your strategy revolves around responding to competitors, you position yourself as a follower by default. You’re always one step behind, responding to yesterday’s innovations rather than creating tomorrow’s.

This dynamic is particularly visible in technology hardware, where companies spend years trying to catch up to Apple’s latest iPhone innovations, only to find themselves perpetually behind as Apple continues evolving. By the time competitors added fingerprint sensors, Apple was moving to facial recognition. By the time they added facial recognition, Apple was refining the experience and moving toward new interaction models.

Diminishing Returns

Markets reward originality and penalise imitation. The first company to introduce a meaningful innovation generally captures disproportionate value, while followers receive diminishing returns.

When Warby Parker disrupted the eyewear industry with their direct-to-consumer model, they created a billion-dollar business. The dozens of “Warby Parker for X” companies that followed—selling everything from mattresses to luggage using similar approaches—generally achieved progressively smaller outcomes, as each new entrant further commoditised the model.

Authenticity Gaps

Customers have remarkably sensitive authenticity detectors. They can sense when a company is executing strategies that don’t align with its true nature, even if they can’t articulate exactly what feels off.

Banking giant HSBC’s attempt to adopt Silicon Valley-style innovation labs and startup language created a jarring authenticity gap with their traditional banking operations and conservative culture. This disconnect contributed to widespread cynicism about their transformation efforts, particularly given their long-established institutional identity.

Industry Homogenisation

Perhaps the greatest strategic danger is the collective effect of widespread copying: entire industries become homogenised, with companies that are barely distinguishable from one another.

In the airline industry, decades of competitive copying have created remarkably similar experiences across carriers. The same seat configurations, the same boarding processes, the same meal options, the same loyalty programmes—all slightly different in details but fundamentally interchangeable. This homogenisation creates vulnerability to any truly distinctive new entrant.

The False Comfort of Best Practices

Industry “best practices” deserve particular scrutiny as a major culprit in competitive copying. These codified approaches create a false sense of security while actually undermining competitive advantage.

The problem with best practices is that by the time they’re documented, they’re often past practices. What worked brilliantly in yesterday’s context may be wholly inappropriate for today’s reality.

Best practices create four specific hazards:

They Represent Average Thinking, Not Excellent Thinking

Best practices typically document what works reasonably well across many organisations—which means they represent average approaches, not extraordinary ones.

In e-commerce, “best practices” suggest free shipping thresholds, abandoned cart emails, and prominent trust badges. These approaches work adequately, but they’re precisely what every online shop implements. They create functional but undifferentiated experiences that do nothing to establish competitive advantage.

They’re Often Based on Outdated Circumstances

Best practices codify what worked in specific past contexts, but market conditions constantly evolve. Yesterday’s ideal approach may be totally wrong for today’s reality.

Marketing best practices in 2010 emphasised Facebook organic reach, which delivered excellent results until algorithm changes decimated organic visibility. Companies that continued following these “best practices” after the context changed experienced dramatically deteriorating results.

They Frequently Lack Rigorous Evidence

Many supposed best practices are based on anecdotal evidence, limited case studies, or correlation-based observations rather than rigorous causation-based research.

The widespread belief that open-plan offices enhance collaboration persisted for decades despite mounting evidence that they actually reduce face-to-face interaction and productivity. Companies continued implementing this “best practice” because everyone else was doing it, not because evidence supported it.

They Create Pressure for Conformity at the Expense of Distinctiveness

Perhaps most significantly, best practices create normative pressure that makes deviation feel risky, even when differentiation would create competitive advantage.

B2B technology companies almost universally follow the “best practice” of gating content behind lead capture forms, creating nearly identical customer experiences across vendors. The rare company that breaks this convention by making valuable content freely accessible often creates meaningful differentiation precisely by rejecting the industry norm.

The Hidden Opportunity in Contrarianism

The good news? While most companies rush to copy what market leaders are doing, the most powerful competitive opportunities often emerge from deliberately taking the opposite approach.

This isn’t contrarianism for its own sake, but a strategic recognition that meaningful differentiation requires questioning the fundamental assumptions that drive industry norms.

The most distinctive businesses often succeed precisely because they identify and challenge these assumptions.

Questioning Dominant Industry Logic

Every industry operates on a set of shared assumptions about what matters and how things should work. These assumptions often go unquestioned for years or decades, creating opportunities for those willing to challenge them.

When Pret A Manger entered the fast food market, they deliberately questioned the dominant logic that “fast food must be unhealthy and prepared in advance.” While competitors focused on shelf-stable ingredients and frozen products, Pret built a successful business around the opposite approach: fresh food made daily in each shop. Their contrarian stance on preservatives and pre-made meals became a central element of their market position.

Solving Problems Competitors Ignore

Industry blind spots—problems that most competitors systematically overlook—often present the greatest opportunities for differentiation.

When Dyson identified that existing vacuum manufacturers were ignoring the loss of suction caused by traditional bag systems, James Dyson created a billion-pound business by solving a problem that competitors didn’t even acknowledge. His willingness to address issues that the industry systematically ignored became a powerful market advantage.

Creating Distinctive Approaches to Universal Challenges

Even when addressing widely recognised challenges, taking a fundamentally different approach can create powerful differentiation.

When Monzo entered the banking space, they recognised that all financial institutions faced the universal challenge of building trust. While traditional banks adopted standard approaches like emphasising their history and physical branches, Monzo took the radically different approach of radical transparency—sharing their product roadmap, involving customers in development, and openly discussing their challenges. This distinctive approach to the universal trust challenge created meaningful differentiation in a crowded market.

Embracing Constraints That Others Avoid

Many of the most powerful contrarian strategies involve embracing limitations that competitors work to avoid, turning apparent weaknesses into distinctive strengths.

When MUJI entered Western retail markets, they embraced constraints that other retailers fought against: no visible branding, limited colour palettes, simple packaging, and unfinished aesthetics. By turning these apparent limitations into a distinctive brand philosophy, they created a retail experience that stands apart from competitors who constantly add more colours, features, and prominent branding.

Case Study: How BrewDog Questioned Everything

Perhaps no company better illustrates the power of contrarian thinking than Scottish craft brewery BrewDog. Founded in 2007 by James Watt and Martin Dickie, they entered a UK beer market dominated by centuries-old breweries and multinational conglomerates with seemingly insurmountable advantages in scale, distribution, and marketing budgets.

Rather than attempting to compete on the same terms as these established players, BrewDog systematically questioned and inverted nearly every industry norm:

• When large brewers obscured their ingredients and processes, BrewDog made their recipes completely transparent.
• When competitors spent millions on polished advertising, BrewDog created provocative, low-budget marketing stunts.
• When established brewers emphasised smooth, approachable flavours, BrewDog created intensely hoppy, high-alcohol “extreme beers.”
• When industry giants raised funding through traditional investment, BrewDog launched “Equity for Punks”—allowing customers to become shareholders.
• When competitors maintained professional corporate communications, BrewDog’s founders communicated in brash, unapologetic language.

This systematic inversion of industry norms wasn’t random rebellion but a deliberate strategy to create meaningful differentiation where they couldn’t compete on traditional terms.

The result? In just 15 years, BrewDog grew from a garage operation to a £2 billion valuation, building a global brand while most traditional brewers struggled with declining relevance. Their contrarian approach created precisely the distinctiveness that generated natural gravitational pull in the marketplace.

The Industry Norm Inversion Exercise

So how do you identify opportunities to differentiate through contrarian thinking? The Industry Norm Inversion Exercise provides a structured approach for questioning established practices and discovering distinctive alternatives.

Step 1: List Industry Norms

Begin by identifying 8-10 “standard practices” that nearly everyone in your industry follows. Focus on approaches that are so common they’re rarely questioned—the “that’s just how it’s done” aspects of your business.

For a traditional accounting firm, these might include:

• Charging by the hour or using time-based billing
• Organising around technical specialties (tax, audit, advisory)
• Formal office environments and professional dress codes
• Partner-track career progression over many years
• Client communication primarily during tax season or reporting periods
• Technical language in client communications
• Hierarchical firm structure with partners at the top
• Conservative brand identity and marketing

Step 2: Question Origins

For each norm, explore its foundations by asking:

• Why did this practice start in the first place?
• Is the original reason still valid in today’s context?
• Who benefits most from maintaining this standard?
• What assumptions does this practice make about customers?

Continuing with our accounting example, questioning hourly billing might reveal:

• Origin: Began when accounting work was more manual and time directly correlated with value created
• Current validity: Much less valid now that technology automates many processes
• Primary beneficiary: Benefits firms by removing pricing risk, not necessarily clients
• Underlying assumption: Assumes clients value accountant’s time rather than outcomes

Step 3: Explore Inversions

For each norm, consider what would happen if you took the opposite approach:

• What if you did exactly the opposite of the standard practice?
• What if you eliminated this practice entirely?
• How might you accomplish the same goal through a completely different means?
• What customer problems does the current norm fail to address or actually create?

For the hourly billing example:

• Opposite approach: Fixed outcome-based pricing regardless of time invested
• Elimination: No formal billing at all, replaced with subscription model
• Alternative means: Technology-first approach with minimal human time
• Unaddressed problems: Current approach creates client anxiety about calling with questions (meter always running), incentivises inefficiency, and makes costs unpredictable

Step 4: Evaluate Potential

Rate each potential inversion based on four criteria:

• Differentiation potential: How distinctive would this make you in the market?
• Value alignment: Does this better reflect your essence and values?
• Feasibility: Can you execute this with your current resources?
• Customer benefit: Would this create meaningful value for customers?

For the fixed pricing alternative to hourly billing:

• Differentiation: High (few accounting firms use outcome-based pricing)
• Value alignment: Medium-High (if your essence includes client empowerment)
• Feasibility: Medium (requires new estimation and scoping processes)
• Customer benefit: High (creates cost certainty and aligns interests)

Step 5: Select Signature Inversions

Choose 1-3 high-potential inversions to develop into signature approaches that will define your distinctive position. The best candidates typically score high across all four evaluation criteria.

For our accounting firm, the outcome-based pricing inversion might become a signature approach that drives the firm’s entire positioning: “We’re the accounting firm that guarantees results, not hours.”

Counter-Example: Marks & Spencer’s Digital Transformation Missteps

To understand the dangers of competitive copying, consider Marks & Spencer’s digital transformation efforts in the 2010s. As online shopping grew, M&S found itself lagging behind digital-native retailers and sought to catch up by implementing what appeared to be industry best practices.

Despite investing over £150 million in their digital transformation between 2018 and 2021, M&S struggled to gain digital traction. Their approach largely consisted of attempting to copy elements from successful competitors:

• Website features from John Lewis
• Loyalty programme mechanics from Amazon Prime
• Distribution model elements from Next
• Digital marketing approaches from ASOS

While each of these elements worked effectively in their original contexts, the combination created a disjointed experience that lacked a distinctive essence or purpose beyond “being more digital.” The transformation offered no compelling answer to why customers should choose M&S online over the competitors they were imitating.

This copying approach led to fundamental strategic missteps:

• The complex website design contradicted M&S’s traditional strength in straightforward shopping experiences
• The loyalty programme failed to leverage M&S’s unique cross-category potential across food and clothing
• The distribution model didn’t account for M&S’s distinctive store footprint and product mix
• The digital marketing didn’t reflect M&S’s heritage and unique brand voice

Had M&S spent more time questioning industry assumptions and leveraging their distinctive essence rather than copying competitors’ surface features, they might have developed a truly distinctive digital approach worthy of their substantial investment. Instead, they created an expensive amalgamation of copied elements without the underlying coherence that made each original approach successful in its native context.