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direct competition

Contributor(s): Ivy Wigmore

Direct competition is a situation in which two or more businesses offer products or services that are essentially the same; as such, the businesses are competing for the same potential market.

Apple's iPhone, for example, is in direct competition with Samsung's Galaxy in the smartphone market; the company's Macbook line competes directly with Dell's XPS line in the notebook category. 

Vendors often use competitive differentiation strategies to set their products, services and brands apart from those of its direct competition. The purpose is to convince potential customers not only that your product is different from others in the category but that it is superior to them. Design, quality, price, features and support are among the factors that a vendor might promote as unique selling points (USP).

Direct competition contrasts with indirect competition, in which two or more businesses offer products or services that, although different, might fulfill the same consumer need. 

This was last updated in April 2015

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