[monkeyspaw]

"Oh, so what you're building already exists as a part of this other application"

Perhaps it doesn't focus on that component, then? Can you resegment the competitor's market, at a lower price, so that your product does just the one thing but does it better?

I like the strategy of finding one thing that your competitor does and focusing on that but doing it really well. Makes it easier to explain the value prop, too.

So many times, large offerings are very expensive, have 15 components, but the primarily value for a segment of the target market is just the small piece.

Provide value, price accordingly, and you can succeed.