Position Against Your True Competition to Win the Customer

And deliver a Mafia Offer your customers cannot refuse.

Most entrepreneurs never bring up their true competition during a product pitch because either they

  • don’t think they have any,
  • don’t know who they are, or
  • don’t want to tip their customers toward the competition.

This is a costly mistake.

Here’s why.

1. Every successful product had true competition

If you haven’t been able to identify your true competition, chances are you aren’t looking broadly enough and limiting yourself to a narrow category.

Your true competition transcends product category.


  • drill bits vs. command strips
  • compact disc players vs. iPods vs. streaming services
  • vaccines vs. social distancing

2. Your true competition is often not who you think it is

Too many startups look to position themselves against other “shiny” competitors in their space also trying to win the customer.

This is typically NOT your true competition.

They haven’t won the customer and maybe never will. Unless your customers use, evaluate, or mention them, they don’t exist in the competitor matrix.

Your true competition is what your target customer is currently hiring to get the job done.

3. Your customers know your true competition

If your target customer isn’t looking for a new solution, they will compare you against their existing alternative.

If they are actively looking for a new solution, they will compare you against new alternatives.

In other words, your customers are sophisticated and will compare-shop anyway. Would you prefer that they compare you to the competition without you in the room when you have no say in the comparison?

Your competition is the elephant in the room, and it’s your job to expose it and diffuse it.

Innovation is about causing a switch from an old way to a new way, and the best way to cause a switch is to break the old way.

This is precisely why a good product pitch shouldn’t ignore the competition but rather do three things:

  1. Name the old way.
  2. Break the old way.
  3. Cause a switch to your new way.

Doing these three things well is how you turn an offer into a mafia offer.

Mafia Offer: An offer your customers cannot refuse.

Let’s see an example of a Mafia Offer in action.

The iPad Mafia Offer


I still remember Steve Jobs’ unveiling of the original iPhone in 2007. As he opened the keynote, he announced that Apple was entering the smartphone market with a revolutionary new device combining three devices: a music player, a PDA, and a phone.

Then he quickly pointed out the problems with existing smartphones: 40% of the phone is taken up by a plastic keyboard (not smart), and they aren’t easy to use. Before showing the iPhone, he teases the iPhone’s UVP with great effect: What if you could have a phone that was all screen? And instead of using a stylus to control the phone, what if you could use your fingers?

That was immediately different and attention-grabbing.

As he walked through the demo, I thought he was performing a magic trick as I had never seen any user interface like it before. I was sold and even stood in line to purchase the original iPhone when it officially went on sale.

Three years later, there were rumors that Apple would unveil a new tablet device— the iPad. This time, however, I was on the fence. I had been an early adopter of several tablets before the iPad and had been underwhelmed by all of them.

Despite my skepticism, I tuned in to watch the unveiling and again bought the product. Fast forward to today, my household has more iPads than people. You could argue that the iPad was even more successful than the iPhone by that logic.

How did that happen?

Do you remember how Steve Jobs pitched the iPad? Even if you didn’t watch the keynote live, can you guess?

What he didn’t do

Steve Jobs could have come on stage and said: “We are Apple, and we build great products that are simple to use. We have built the best tablet in the world, so buy one.”

This would have been a category-centric pitch.

The problem, of course, is that no one, other than a small sliver of innovators and early evangelists, was using tablets at the time. How do you pitch a new category-defining product when the category doesn’t yet exist?

What he did instead

  1. Name the old way
  2. Opening the iPad keynote, he didn’t talk about tablets but set the stage to introduce a new product (iPad) that would compete with laptops and smartphones.
  3. Break the old way
    He then singled out a single existing alternative as the iPad’s true competition: the Netbook. In less than 30 seconds, he breaks the old way for his audience:

  4. “They’re just cheap laptops and not really better at anything—they’re slow, with low-quality displays, and run on clunky PC software.”

    This set the stage for introducing the iPad.
  5. Cause a switch to your new way.
    With the stage set, he then demonstrates how the iPad is better than the Netbook and cheaper. Doing both these things is what sets his pitch apart from others and makes it a mafia offer.

So next time you pitch your product, don’t leave it up to your customers to determine your true competition.

  • Do your homework,
  • Anchor against your true competition, and
  • Watch your customers nod through your entire pitch.

Bonus Section for Newsletter Subscribers: How to Pitch Like Steve Jobs

Steve Jobs was a great storyteller; you might wonder how you’ll ever get to deliver your pitch as naturally as he did. It comes down to preparation and practice.

A good story pitch template is the first key to assembling a good pitch. In this section, I’ll dissect Steve Jobs's iPad pitch step-by-step into a Mafia Offer Story Pitch template you can use to pitch your product.

The Mafia Offer Story Pitch is inspired by the most popular story arc of all time: The Hero’s Journey, popularized by Joseph Campbell in his book: A Hero with a Thousand Faces.

This story arc has appeared in all kinds of epic tales and is still used in most Hollywood blockbusters today. Star Wars, Harry Potter, and Cinderella -- all share this story arc. This same story arc can also deliver a compelling product pitch.

The first step to creating any story is defining the characters.

Define the Characters

Who are the essential characters for a Hero's Journey story? Yes, a hero and a villain.

Who's the hero in your story?

It may come as a surprise... but you aren't the hero in the product pitch, nor is your product. The hero is your early adopter.

You don’t actually want to be the hero in this story. Think back to movies like Harry Potter or Star Wars. The hero's journey is a transformation story that begins with a struggling protagonist who reluctantly accepts the call to become a hero.

How about the villain?

This one is easier. Yes, the villain is your true competition. Your true competition represents the existing alternatives you seek to displace with your solution.

In the case of the iPad, this was laptops (the Netbook).

Your true competition, not only sets up the stage for comparing features, but also pricing. So pick carefully.

So, where do you fit in?

You are the person who guides the hero through their transformation from ordinary to hero. You are the guide character. This is Obi-wan in Star Wars, Dumbledore in Harry Potter, and the Fairy Godmother in Cinderella.

Where does your product fit in?

Your product is the gift you give the hero that makes this transformation possible.

Outline the Structure of your Pitch

The Mafia Offer Story Pitch follows a 4-act structure:

  • Act 1 — Setup (Share the Bigger Context)
  • Act 2 — Confrontation (Break the Old Way)
  • Act 3 — Resolution (Demo Your Better New Way)
  • Act 4 — Call-to-Action (Ask for the Switch)

Act One - Setup (Share the Bigger Context)

Act One sets up the bigger context for your pitch. It establishes your customer as the protagonist and names a big and relevant change (switching trigger) that raises the stakes and drives a sense of urgency for a desired outcome.

Act Two - Confrontation (Break the Old Way)

Act Two is where you name the specific existing alternative you’ll be displacing (true competition), describe why the existing alternative falls short (problems), and break it as a viable alternative for your customers.

Act Three - Resolution (Demo Your Better New Way)

Act Three is where you reveal your gift (your new way) and demonstrate how it helps your customer overcome the obstacles you’ve presented and achieve their desired outcome. This is the job of your demo and where the emotional-purchase happens.

Your demo isn’t intended to be just a collection of pretty screenshots or a working prototype. Instead, it is a carefully scripted narrative that helps your prospects visualize your unique value proposition and believes you can pull it off.

It should walk them from their current reality (riddled with existing problems that stem from their existing alternatives) to your envisioned future reality for them (one where these problems are solved with your solution).

Act Four - Call-to-Action (Ask for the Switch)

Act Four is where you clearly articulate the specific next action you want your customers to take. Too many entrepreneurs cop out at this step and simply settle for verbal commitments because it’s easier. The mindset in play here is one of “lowering sign-up friction.” We want to make it as easy as possible for the customer to say yes and agree to take a chance on our product – hoping the value we deliver over time will earn us the privilege of their business.

The problem with verbal commitments is that they are easy to make and just as easy to break. Not only does this approach delay validation because it’s too easy to say yes, but a lack of strong customer “commitment” can also be detrimental to optimal learning.

This brings us to the first guideline for your call to action.

Don’t lower signup friction. Raise it.

Your job at this point is to find early adopters who are at least as passionate about the problems you’re addressing as you are. The way you do, this is not by lowering signup friction, but raising it.

Position your MVDFP (Release 1.0) as a prize.

Too many entrepreneurs are embarrassed by their first release and use labels like alpha and beta to describe them. Alpha and beta labels frame your product as less than perfect and ask for forgiveness even before your customers get to use it.

If you’ve done the necessary work to meticulously research and define your MDVFP, you shouldn’t be embarrassed but proud. In the customer story pitch, your Release 1.0 is the gift you give your customers that helps them overcome their obstacles and achieve their desired outcome. You should position it as such.

Instead of using alpha and beta labels, I prefer early access, which communicates that your MVP is a prize and will only be released to a select few. It also signals scarcity, which drives up desire—especially for early adopters.

Build your pricing story.

Many people feel awkward or guilty when delivering their pricing model to customers. But if you’ve done your research and followed the customer story pitch until this point, your prospects have already made an emotional-purchase of your new way.

Delivering your pricing model is about making a logical case for how you arrived at a fair price for your product, anchored against the existing alternatives and the value you promise to deliver. There is no need for emotion to creep in. Remember, this is where the rational-purchase happens.

Explicitly anchor your pricing against the old way

You saw how Steve Jobs anchored the iPad against Netbooks and turned it into a great deal. This is a critical and powerful step. Don’t skip it.

Lay out what happens next.

Once you’ve shared your pricing model, clearly lay out the steps for what happens next, and ask for the sale.

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