So you wake up one fine morning, open the newspaper and it suddenly hits you right between the eyes: there’s a full-page ad announcing the grand opening of a new competitor. This does not sound like good news. An emergency meeting hastily takes place at the office and the gloomy faces of your fellow workers speak volumes. “Help – there’s a new competitor! Who’s this new kid on the block and how will he affect our business?!”
According to many economists, if you play your cards right, that new kid on the block will actually affect your business in a positive way. Because believe it or not, competition is not scary for business… it’s healthy.
The presence of competition in the marketplace automatically pushes us all to stay on top of our game and create new strategies that’ll take our businesses to higher levels. Or as a successful client of mine, Eli O., recently told me: “I love having competition. It provides me with a guaranteed way to maintain a competitive edge!”
Still don’t believe it? Then take a look at what happened to a famous company named IBM and how they chose to respond to a serious threat caused by their competition.
For many years, IBM was the world’s leading manufacturer of personal computers, selling high-priced models through its network of affiliated retail stores. During the 1990s, when startups like Dell and Gateway began selling computers directly to customers at much lower prices, the playing field drastically changed and IBM posted a $5 billion loss that threatened to topple the once-legendary company.
Instead of throwing in the towel, IBM executives took a hard look at the direction their company was headed, analyzed precisely how the competition had shifted the playing field, and came up with a novel solution that would not only set the company back on track – but also position IBM on a fixed course toward future success.
The company quickly set about reinventing its business. Instead of focusing solely on selling actual computer “hardware,” IBM borrowed a page from their competition’s playbook and createda new category. They began developing and selling bundles of “software” solutions that were easily compatible with the many different computer brands available on the market. Fact is, thiscleverly-positioned niche singlehandedly saved the company from bankruptcy and created an entirely fresh industry from which to profit.
While most of us are probably not in the computer manufacturing industry, there are still a number of important lessons to learn what you can do to help keep your business immune from the competition. Here they are:
Analyze Them All: Visit the websites of your competition to see what they have to say about their own products or services. Then put yourself in the shoes of your competition by visiting your website and imagining what they would say about your own products or services.
Grab An Angle: After studying the competition carefully, analyze what sets you apart. Then take this information and use it as a powerful marketing vehicle to promote your business in a manner that allows you to clearly differentiate yourself in the customer’s mind.
Always Stay Informed: Tradeshows and seminars can provide you with valuable opportunities to learn what’s happening in your industry. I know this tip sounds overly simplistic, but some of my most successful ideas occurred after attending a seminar or while talking to fellow businesspeople at tradeshows.
And the most important point of all? Don’t be scared to open a newspaper in the morning. Or worry that people may try to compete against your business. Or become anxious every time you hear a rumor about a new store opening down the street.
Rather, view your competition as a solution and not an obstacle. It’ll put you in the proper mind frame to achieve long-lasting success… and will provide you with a fresh sense of appreciation for that new kid on the block.
Onwards and upwards,
Meny Hoffman
