Marketing Viewpoint by Ruth Winett
Is the Competition Beating You? Four Probing Questions for Assessing Your Competitors
As soon as primitive people began producing baskets and other goods for trade, they faced competition. To evaluate your competition, you should pose four key questions say Carston Lund Pedersen and Thomas Ritter in a June 5, 2018, Harvard Business Review article focusing on consumer products. Their questions and analysis apply to business-to-business competition, as well.
Assess the Competitive Landscape with Questions
Ask the following four questions to ascertain first "Are there customers to compete for?" and second "Is the competition beating you?"
"Competing for relevance." Do your offerings solve your customers' real problems or satisfy customers' needs? Whether a new technology solves real needs is often unclear. The authors ask whether Blockchain can deliver on its "promises of securing transparent and secure transactions" thereby making brokers and bankers "irrelevant." To ascertain if you have customers--that is if your offering is relevant-- you must have deep knowledge of your customers, their operations, and their needs.
"Competing for dependence. Do your customers provide their own solutions," bypassing your solutions? During the 2008 Recession, many people reverted to do-it-yourself solutions, such as cutting their own hair recall the authors. Moreover, people increasingly turned to Target, Ikea, and others that cater to the do-it-yourself customer. This is also a challenge in the B2B world. When we conduct new product concept tests, we sometimes find that participants have developed their own homegrown solutions. Often these solutions are so deeply embedded in the company's operations that it is very difficult to replace them with our clients' newer, more advanced solutions.
"Competing for preference. Do customers prefer your offerings to your competitors' offerings? As businesses and consumers generally prefer one provider for one type of product or service and another provider for another category of products, competition can occur "at the product level." One way you can become the preferred provider is to provide superior quality products and superior service.
"Competing for Excellence. How can we renew our business?" Having competed "for relevance, dependence, and preference, organizations must consider competition for excellence," conclude the authors. The challenge then becomes "to sustain the organization's advantage while continuously seeking renewal." You can build upon your organization's advantage by adding new products and improved services.
By defining the types of competition you are facing, you can more easily develop strategies for responding to the competition. Having established the relevance of your solutions, compete for dependence on your solutions, preference for your solutions, and then seek excellence/sustainability. This is your organization's ultimate challenge: you are never finished. You must always strive to "sustain the organization's advantage."
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