Google Latitude on iPhone became a competitor of my app, what should I do?

Congratulations, based on this new competitor, it seems like you have found a target market that is worth going after with this product.

As far as having a NEW competitor, out market them quickly. The number of people who will want this is finite. So push hard (quickly) to get customers to adopt your product instead of theirs. As a quick push, possibly try advertising it strategically in certain forums and blogs and see if you can get some sales. The graphics on your site look decent, so try some skyscraper ads that feed into landing pages that are duplicates of your home page so you can see what is converting.

I would say focus on exploiting it for as much as it's worth financially (whatever that amount is). Do what you need to in order to sell as much as you can "quickly" (try to saturate the finite set of users with your product) and then possibly offer an upgraded Pro version for a small upcharge to your existing customers to take on some additional sales revenue. Price the Pro version a little behind the competitors product and add some features that your customers are asking for (get feedback from them for this purpose).

Also, if you think it's a head to head product and yours is better, possibly put a comparison of their product and yours right on the front page of your site.

Another thing is maybe think about getting some pro voice over talent for your video. Maybe a local radio station has someone who can do a good job for a low price. You might want to think about using a female voice and a male voice and do some A-B testing on the video. I think it will make the video seem more professional.

The best thing to do is to keep innovating. I assume you are not as large as Google, and therefore have the ability to move faster.

Think about what your assumptions are about what your software can and should do. List them out, and really critically re-evaluate them. I am certain you can come up with something everyone in this game is taking for granted, flip a bit, and outdo the competition.

For example rethink the concept of sharing your location NOW. What happens if your app instead tracks you over time, creating a heat map of your territories/areas, and can predict where you will be going based on past trends. Now you are doing something even more interesting with a much larger market. Involve the user in predicting/changing the location behavior and you may find a much larger audience than you were ever expecting.

There's a million ways to go, make your own way up if you want to!

Maybe push the "shared pins" aspect? Let friends post up local restaurants they like, and then show which of your friends have been there recently, etc. The social aspects is something Latitude is missing. Something like Latitude-meets-Foursquare would give enough extra for people to use it over Latitude.

Also push that you're not google, and therefore the location data on your app isn't tied with other aspects of a persons life. "Your location is ONLY used to share with specified friends". That's a major thing that puts me off Latitude (even though I do use it, it's always on my mind).

You were already competing with a handful of other startups in this space, including the YC-funded Whereoscope.

Genuine question: how much business were you doing before that you're worried about losing it? You wouldn't be the first company to get steamrollered by some random Google/Apple/... side project.

+Make the landing page nicer. Add a better one-liner which tells people exactly what your app does.

+Make it more personal. Be super nice to your users. Do awesome things that don't scale.

+ Start a competition, make a game out of your existing user actions. A Christmas treasure hunt?

+Add user-created map layers building virtual worlds on top of the real world.

STOP thinking about Google. Just do your thing and be so good they can't ignore you.

I want to echo what others have said. Play to the advantages exclusive to small companies.

Having seen your landing page and the video, this about the app:

- I liked the simplicity and the concept of the app a lot.

- Does the msging in any way interact with sending SMSs/IMs?

- It's a great idea to be able to message your sharing friends, but what's the quickest way to reach your friend after you receive a pin from them? Think through the usage scenarios - and flaunt them! "It [the whole scenario] just works" is your best friend.

- Ask your non-techie users/friends about the scenarios and make sure you listen a lot.

The landing page:

- show don't tell. More pictures less txt... (take a leaf from the big A).

- I wouldn't use the word "setup" at all, when you've basically intelligently managed to rid your users of that chore. That's something to flaunt, whereas the very word setup IMO is a turn-off. Just go with "no sign-up"/etc.

- The first paragraph to me looked like filler even if it may be good and true. It would be more appealing to me to directly explain concrete cases where the app can achieve the good things you speak of. (I hope you've watched the FaceTime commercial a lot lately)

- The video is a great beginning, but turn up the voice/eq it (I had some trouble hearing it), and turn down the music a bit?

- Make sure you ask non-techies how it resonates with them. Listen carefully.

- The same operation on your iTunes page, and make sure the screenshots are of very self-explanatory usage cases.

Compete.

See: http://news.ycombinator.com/item?id=2002667

Carve out your niche. Google in your marketplace is not a seal of death - look at Zoho.