How to Handle Competition

Competition: How should you handle it?

By Douglas Campbell III, The Success Coach

Is the number of competitors in your space growing? If not, will this happen in the future? What stage of the business cycle is your business in today? Or are you in a staid and stable business?

We all have fears about competition, but without “solid” competition, your market may not be validated. When my wife, Gwynne, and I started the first Sylvan Learning Center in Darien on the East Coast in 1984, we constantly faced the challenge of explaining what a professional tutoring center is and what it can do for kids. Now with national TV advertising and a track record with thousands of success stories helping kids catch up, get ahead, and, most importantly, feel good about learning and themselves, we face competitors on every front. They are in church basements, in large group classes, always sitting in front of a computer software program, or working in a tutor’s kitchen. We have always focused on one-to-one instruction with certified teachers in a professional learning environment. We visit schools and sit in on parent-teacher conferences, and most of all we get outstanding results. In fact, Sylvan has a stronger leadership position today than it has ever had. For the most part, we have ignored the competition and focused on what we do best, and it has worked.

Here are 17 grounded questions and answers to develop a plan to respond to your competition:

· Periodically evaluate where your business is now – Know where are you on the product life cycle (PLC) and where are your competitors on the PLC. Know how fast your market is growing. Be clear on what new markets are you going to get into. Answers to these questions will provide you with an overview of the importance of competition.

· Study competitive strategies – Is it to skim (high prices and a small market share ) or to penetrate a market and obtain a large market share? Do you have interlocking partnerships with key companies whose services and products overlap or intermingle with yours? Will you put on a sales or advertising blitz for 4-6 weeks to gain “share of mind”? Are you blocking competitors through written agreements with clients, technology, or great customer service? Are you the expert speaking on your products and services?

· Work constantly to execute flawlessly on your company’s marketing plan – Is a clear marketing mix in place which “fits” your company? Are you differentiated in the marketplace and in your customer’s mind? Do you have a budget, plan and consistent message?

· Pass by and learn from the most common errors. Do you focus on where to compete instead of how to compete? Do you place enough emphasis on your uniqueness and continually reinforce it? Have you hired a business coach to help you define what your uniqueness is and how you can leverage it? Are you ready to compete when the time is right? Are you using appropriate and efficient performance measures?

The next year will be one where business and technology steadily rebound from their recent slowdown. There is more choice in markets today than ever before, and yet even more opportunities to find your niche and differentiate yourself and your company. Watch from afar and up close what your competition is doing, but don’t always respond right away. Many times the second or third player in the market is the long-term winner. You may be able to partner with competitors, so talk to them and explore ideas. And, yes, don’t be surprised if it is the case that your competitors aren’t worth all the attention you give them.

Douglas Campbell III (www.thesuccesscoach.com) facilitates team-building and creativity workshops for companies to build effective management teams. As a business coach, he works to find creative solutions to help entrepreneurs grow their businesses. Additionally, his set of experiences include starting 5 businesses, teaching undergraduates and MBA students, serving as Director of Marketing for a Fortune 100, writing for several newspapers and speaking on a range of business topics.