# Competitive Moats And Category Design

Purpose: Use this file when Compete must reason about durable advantage, category creation, PLG competition, pricing posture, or developer-experience competition.

## Contents

- modern moats
- ERRC and Blue Ocean framing
- category design
- PLG competition
- pricing intelligence
- DX competition

## Modern Moats

Feature moats compress quickly. Prefer advantages that compound over time.

| Moat | Why it lasts |
|---|---|
| SEO | long accumulation and discoverability |
| Brand | trust compounds slowly |
| Taste | design judgment is hard to copy |
| Speed | organizational execution habit |
| Data | learning flywheel |
| Trust | deep customer relationship and reliability |

Common properties:
- time-dependent
- experience-dependent
- system-dependent

### Moat Assessment

```markdown
## Moat Assessment

| Moat | Strength (1-5) | Build Time | Relative to Competitors |
|---|---:|---|---|
| SEO | | | |
| Brand | | | |
| Taste | | | |
| Speed | | | |
| Data | | | |
| Trust | | | |

Composite moat: [...]
Weakest moat: [...]
Reinforcement priority: [...]
```

## Blue Ocean Framing

### ERRC Grid

| Action | Question |
|---|---|
| Eliminate | what does the category keep that buyers do not truly value? |
| Reduce | what can be cut below the industry norm? |
| Raise | what deserves more investment than the norm? |
| Create | what valuable element does the category still not offer? |

Use ERRC when the task asks for differentiation rather than parity.

## Category Design

| Zone | Description | Risk |
|---|---|---|
| Green | compete inside the existing category | red-ocean pressure |
| Blue | vision is too far ahead of the market | adoption timing risk |
| Sweet Spot | vision leads the market by `2-3 years` | best category-design window |

Use category creation only when the value curve is meaningfully different from incumbents.

## PLG Competition

Key signals:

| Metric | Signal |
|---|---|
| SaaS companies using PLG | `58%` |
| planning to expand PLG investment | `91%` |
| reporting sustained growth | `27%` |
| AI app spend coming through PLG | `27%` |

### PLG Evaluation Axes

| Axis | What to inspect |
|---|---|
| Time to Value | how fast value appears |
| Freemium Design | upgrade path and value exposure |
| Onboarding | guidance quality and drop-off points |
| Viral Coefficient | sharing and invite mechanics |
| AI Integration | personalization or automation in product |
| Product-Led Sales | handoff from self-serve to sales |

Heuristic:
- products needing more than `60 seconds` to reveal value are exposed to faster PLG alternatives

## Pricing Posture

| Signal | Data |
|---|---|
| value-based pricing adoption | `78%` |
| AI-driven personalized pricing in enterprise SaaS | `65%` |
| usage-based pricing adopted or planned | `85%` |
| hybrid pricing adoption | `61%` |

Value-based pricing outcomes:
- revenue can improve by `30%+`
- ARPU can improve by `23%`

Use pricing analysis to decide:
- whether the category is moving toward value-based, usage-based, or hybrid pricing
- whether a competitor is winning on lower price or clearer value capture

## DX Competition

| Signal | Data |
|---|---|
| high-quality DX improves delivery flow likelihood | `31%` higher |
| top DX teams outperform | `4-5x` |
| top developer velocity performers grow revenue faster | `5x` |

### DX Comparison Axes

| Axis | What to inspect |
|---|---|
| Documentation | completeness, freshness, searchability |
| SDK / API quality | consistency, errors, typing |
| Onboarding | time to first success |
| Community | forum, Discord, GitHub activity |
| CI/CD integration | build, test, deploy friction |
| Support | response time and knowledge base quality |
