There have been a few similar posts on here in the past. The consensus is usually something along the lines of... keep building your product. Don't let your competitors scare you. Think of it like driving; if you drive down the highway staring at the car next to you, you're going to crash. Look forward.

Given that you already have a paying customer helping you develop it, and that your product is supposedly easier to use, this doesn't even seem like a difficult decision.