We all face competition.

Some of you operate in ultra-competitive environments, such as restaurants or retail, where the competition is literally across the street.

Others deal with competition that may not be as close geographically, but that is more potent than ever, thanks to the ability of the internet to shrink the marketplace. I faced intense local competition for years as I built my yearbook photography/publishing business, and I face national and even international competition now in the world of business coaching.

Competition is healthy, it’s part of business, and it’s something that we all deal with. Competition makes us stronger, but it also has the potential to throw us off and make us lose focus.

For example, it often has the effect of shifting a business owner’s focus away from his customers and on to the competitor. The focus becomes on outperforming the competition—offering better products and services, offering them for lower prices, offering new products that the competition can’t match.

Now, none of these ideas are necessarily bad (although in almost every single case, competing by cutting your prices is a mistake).

The problem with this mindset is that what really matters is the experience you provide to your customers. It’s great if your products and services are superior to your competitor’s, but it’s only a small part of the picture. In fact, history is littered with great ideas and great products that never caught on. What really matters is the value that you provide to your customers—and that is something that is easily forgotten when the competition heats up.

Here are three specific areas to focus on in the midst of intense competition:

Focus on the benefits of your products and services that your customers care about. You’ve probably heard me say this before, but your customers don’t care about the shovel… they care about hole they’re going to dig. Don’t get sidetracked trying to beat your competitors in areas that don’t matter to the customers.

Don’t overlook the importance of customer service. The quality of the service you provide is one of the best differentiators you can have—it’s ironic that many businesses are “too busy” to offer great service. Quality customer service should be the last thing you compromise, not the first.

Differentiate, don’t imitate. When you’re focused on the competition, it’s easy to wake up one morning and realize that you are just like them! Don’t lose sight of who you are and what makes you different. Differentiate yourself from your competition and you’ll leave them in the rear-view mirror.