The Competition Doesn't Count!?!?!?

This old refrain popped up recently while I was interviewing for a consulting project. When asked about his competition and their impact in the marketplace, the business owner told me his philosophy: “The competition doesn't matter. Just do a good job, and the customers will come to you.”

I've heard this line before, and my response is 3 simple words:

Ba. Lo. Ney!

This attitude harkens back to a simpler, more gentile business environment. During the Eisenhower administration, maybe. But that was long ago.


Today, Your Competition Most Definitely Matters.

It sets the parameters for the conversation you have with your customers. Every one of your sales prospects has an idea of the products available in the market, and their price. Where do they get all of that information? From your competition.

• They listen to the ads,
• research their websites,
• and talk to their sales people.

If your competitors offer a similar product to yours for about $100, and you are priced at $120, your customers will be asking questions.

If the competitors have the product in stock, but you need 4 days to deliver, your customers will expect you to have a solid reason for doing things differently.

If the competition allows people to place their orders over the web, but you make them come in and talk to a sales person, your customers will want to know why.

The buying public won't allow you to operate within a vacuum. They'll evaluate everything you do in the context of what the competition does.

I read a great line recently: “we live in the age of transparency”. That is absolutely true in the sales environment. Your customers are familiar with your competition, their products, services and prices. And that frames the conversation when you begin your sales pitch.

So how do you operate effectively in this atmosphere? You need to arm yourself with two critical sets of information:

1. An understanding of your primary competition, and how they are viewed by the buying public.
2. Some key points of differentiation that will help your prospect see you in a different light, and perhaps justify increased margins.

Those two statements are simple to write, but might take a small business years to master. However, in them lies the difference between being a top contender in the marketplace and being just an also-ran. The competition sets the parameters of the game. How well-equipped are you for the challenge?

Practical Tip of the Day:

• Don't ignore the competition; embrace the challenge.
• Do a “shelf-space” analysis of your competitors, inside the head of your customer base. Do some extensive interviews with customers and prospects. (If you are the Boss, do this yourself. Don't delegate!)
• Figure out why you aren't considered at the top of the list, and develop a plan for the next 12 months.

HOWEVER, don't try to become #1 by mimicking the current #1. But more about that later.