In such a saturated digital marketplace competition is inevitable. Regardless what product or service you offer. How this competition affects the performance of your business, starts with your own mindset and approach to it.
In this article I will explore the ways in which you can do so in a healthy way to differentiate and sustain growth. I will also touch on some common pitfalls associated with an unhealthy approach to competition.
When we talk about competition, our initial thoughts are of fear and threat. It is a natural response to others gaining market share, converting potential prospects, or even stealing aways some of your existing customers. But it doesn’t have to be this way at all.
When we approach it with this mindset, we have already formed a judgement about the outcome that competition will lead to. This will reflect in the way we communicate through our messaging and strategies. At times we may come across in a defensive way. We may use aggressive sales techniques, or even discount unnecessarily.
Over time as we see our conversion rates (and margins) fall, we instantly blame, what we believe is the cause. The competition! When in actual fact the most likely reason was the change in our behaviour and approach.
So how can we approach it differently and break this cycle?
If we consider the competition as healthy part of our business growth. There is so much more we could achieve:
Competition leads to more demand
It goes without saying that if a product or service has no demand, then there would be no one providing it and no competition.
If there is a clear need, and more than one company is highlighting and addressing it, then the demand for that product/service will grow.
Example: VA’s have been around for a long time. For many, selling the idea of outsourcing your admin tasks to someone online was the biggest challenge. Yet, since the first lockdown and the focus turning to virtual working. The demand for this service has grown exponentially. With more and more new VA franchises and freelancers highlighting the benefits of this type of service. Keeping up with demand is now the challenge for many!
Competition keeps you on your toes
Knowing there are more businesses out there who can provide the same service or product that you do is the greatest incentive to innovate and differentiate yourself. It helps you to focus in on your own unique features. And helps you to hone your messaging to your customers in a much more targeted way.
Example: Face masks. Up until recently, they were mainly an essential purchase for healthcare providers nothing more. Once they became mandatory for everyone, this escalated to unprecedented demands. This in turn led to the opportunity for many businesses to reposition themselves. Adding their own spin on this staple healthcare product, these have now become a hot fashion accessory. The innovation seen in this area has been a true revelation.
Competition can open new doors
Having a good understanding of what your competitors do and don’t offer is really important. It is a good opportunity to find ways collaborate and form an alliance. After all, we can’t all be good at everything.
Perhaps your competitors have a strength in one area that you find tedious, and vice versa. Why not get in touch and look at a way to come together and offer a more comprehensive service or product. Adding even more value to your customers and growing both your businesses.
This would not only help you to address an area that may have been a weak spot for your own business. But also has the potential of widen your exposure into a new segment or a new target audience.
Example: For many SEO and digital marketing consultants, the focus of a strong digital presence has meant a growth in demand. But for many, the design and build of a website may not be their area of expertise.
Similarly, Web designers may have a weak spot when it comes to content creation for SEO. Or even building a comprehensive digital marketing strategy across all platforms. If the two combined forces, they could provide a one stop shop to customers looking for a solution to enhance their overall digital presence.
Competitors can help you develop your own business
One area we always tend to overlook when we research our competitors, is the opportunity to learn. Taking a step back and looking at how your competition positions themselves. How they position their pricing, what voice they use in their messaging and how they interact with their customers. This provides a great opportunity to learn new methods. It is a great resource for inspiration and ideas that you can adapt and use for your own business.
It also provides a great gage for the market tolerance of how much you should be charging. And what techniques work, and which don’t.
These are just some examples of the positive ways you can adapt your mindset and approach to your competitors. But as mentioned earlier, I also talked about the potential pitfalls…
The danger of direct comparison
Regardless of what you sell and how similar it is to another; it is NOT THE SAME! You are unique. So is your approach and delivery. Don’t get too tied up in the similarities, rather concentrate on the differences!
Don’t shoot them down
No matter how strong the urge, avoid using any communication with customers, written or verbal, highlighting the flaws of your competitors or promote yourself over them. This only comes as across as defensive and a reflection of your own lack of confidence in what you offer compared to them.
Price wars – there are no winners!
One of the most common techniques to combat competition is to offer more competitive pricing and discounting. This only serves as a race to the bottom. It will eat away at any margin you make and could end up costing you more in the long term. Believe in the value you have to offer and look at other ways to add value instead.
Spamming is not the answer
Another method is to increase your Social Media and marketing messages to be more visible in the eyes of the customer. Often repeating the same, sales orientated messages and content. This is more likely to switch your customers off than on. It comes across as spam, and a sign of desperation. Keep you messaging consistent and always look to provide value not hard sell.
No one likes a copycat!
As I mentioned earlier, learning from your competition is a great way to get inspiration. That does not mean “copy and paste” though! Your content, services and products should be your own. The most important part of building trust is being authentic. Customers do their research, they will soon see through it.
You need to find the right balance. It’s important to keep an eye on what your competitors are doing and how the trends are changing in customer demand. But if you are constantly worrying about what the competition is doing. Stalking their social media platforms and websites for updates and new developments. Then how will you ever find the energy and time to move forward yourself?
I hope this article has helped you to see how a small shift in the way we think about “Our Competition” can make the world of difference. Between either finding opportunities to grow or simply finding excuses when we don’t.