How do you look at your competitors? Do you feel that they’re putting you out of business or even that they’re stealing customers from you? Or do you feel that they are actually helping you to grow?
In a capitalist economy, competition is part of the game. If you don’t have competition, you are not in business. The more competition you have, the greater the demand is for your services and the more potential you have to grow. Competition builds awareness: it creates public need for a product or service. And you can benefit from competition if you give people reasons to satisfy their need with your company.
You should be thrilled if your competition spends money advertising the need for your product or service. Research shows that ads make people remember the need that the product or service can satisfy, even if they don’t remember which company took out the ad. This leaves a lot of people who are looking to fulfill a particular desire. To benefit from your competition’s marketing efforts in a crowded field, you should find your own unique niche. General ads build a need in the general market for your product or service, and that broad audience can then be split into niches.
How to handle competition
As a general rule, never make critical comments about your competition. People don’t like to hear that you are better than your competitor, even if it’s true and even if the client knows that it’s true. All you have to do is to explain why others use your company and what keeps them coming back.
Don’t ever use competition as an excuse for not succeeding. Never tell yourself, “I’d have no problems if it weren’t for this big competitor that took away all my business.” This is never true, even if your competitor is much bigger than you are and has many more resources than you have. There are always ways to keep your clients if you are committed to listening to their needs and then go out of your way to fulfill them.
When you look around, you’ll see that no business has ever failed because of competition. Companies that adapt quickly to market changes thrive even when their competitors are ten times bigger. Either they grow to be big players themselves or they get brought out by the competition for a nice profit. The only way competition can really put you out of business is if you decide in your own mind that you can’t compete. Difficulties also come if you don’t differentiate yourself from your competition: the other fellow, after all, was there first and will usually stay one step ahead of you.
But the biggest reason businesses fail is because they don’t adapt fast enough to changes in the marketplace. Bill Gates was once asked what his biggest business mistake was. His answer was that when the internet started to come into view, he knew that he needed to change his business model–but this was number 4 on his list of importance. Then when the internet took off, Microsoft simply wasn’t ready to respond. It took the company years to catch up, although some experts feel it will never catch up. The reality is that the business world is constantly changing and you have to be flexible to adapt to new developments in the market place. Sticking to what you’ve done in the past will put you out of business fast.
EXERCISE OF THE WEEK
Look for ways to build relationships with your competitors in order to create win/win situations. Why not support each other by focusing on different niches and then send business back and forth? This may seem impossible at first but a lot of companies have, in fact, done it. All you need to do is to open your mind. Come up with a plan to work collaboratively with your competitors and then present it to them. If one won’t accept it, someone else may well. You’ll never know unless you try.
QUOTE OF THE WEEK
“I”m not in competition with anybody but myself. My goal is to beat my last performance.” Celine Dion
© 2008 – 2011, Written by Keren Peters-Atkinson, CMO, Madison Commercial Real Estate Services. All rights reserved.