How to Deal with Competition in Your Business
Competition can heat up some steam, particularly in a business where it’s survival of the fittest. It is not an easy world out there, especially when there are other players in the same playground. But no matter how much of a threat a competition can be, it also plays a vital role in improving a business and giving it an extra push.
After the very intense game of Rochambeau between the Matts, Watson started the podcast by asking, “How can competition paralyze oneself as a business owner?” and setting the tone of the episode to discuss how different businesses with different goals react to competition.
DeCoursey stated that there are many ways to look at it. Market size and competition actually means that there’s a demand. In viewing competition, it is often asked, “How much further down the road are these people?” By then, you get to consider the amount of effort the business needs to exert to catch up.
Watson added that there’s another way to look at it. He argued that some businesses that are already way up there, usually don’t take as many risks, thus, allowing the smaller ones to take those opportunities that stable businesses are afraid to take. A Battleship reference from DeCoursey even pictured that it’s always the bigger ship that is easy to hit than the smaller one. Watson narrowed it down to “taking the risks that big companies won’t take.”
Aside from the previous discussions, here are other questions that the duo addressed during the podcast:
What do you do when a big company enters your environment?
Although big companies entering your field of environment can pose a threat, DeCoursey said that it’s actually a validation. He then continued by saying that when big businesses penetrate your industry, it means that what you’ve been doing is valid. And that is something that can be taught by your competition.
How do you take geography into consideration when it comes to competition?
Watson mentioned that it’s always about knowing if it’s worth it. It would take you a business to study how much effort and cost it would take to try and penetrate a foreign area that already has a similar existing company.
Do you think your way of solving the problem has everything to do with your success compared to your competition?
Watson said that both their companies, Stackify and Gigabook, solved a lot of problems for different people. Sometimes, it’s the marketing aspect that takes a product further. It’s in the marketing, product packaging, pricing, and all other things specific to the market a company is catering towards.
How do you solve the problem of coming in second?
DeCoursey addressed that one has to acknowledge being the first loser. Both agreed that it can become a good learning experience. In fact, Watson added that losing is part of the game and the more that one is trying, the more lessons one learns on what it takes to win. It can be very upsetting but it’s not the most productive reaction. Losing should be a motivation to continue and be better.
How can competition stir things up for you?
The beauty of having competition is that a company can ride another (possibly bigger) company’s wave. They talked about market leaders that are on top of their game. An example stated by Watson was on Uber and Lyft being the leading ride-hailing company in the market. In this case, localized versions of the business model started popping up such as zTrip in Kansas City. If these market leaders didn’t exist, then it’s going to be hard for smaller businesses to pave their way to stability.
Additional takeaways from this episode regarding competition include:
- Rank up on search engines. It’s always good to rank up on search engines. Practicing SEO principles on one’s company website is a must. When customers and clients find everything they need on your website, all the rest would not matter as much.
- Don’t talk down competition. No one wants to see you hang dirty laundry. Negativity is not very attractive, especially for clients. DeCoursey mentioned about taking the high road and following the Features-Advantages-Benefits (FAB) approach. When talking about competition, he said, “I’m not an expert of what they do over there, but here are the advantages that you can get when you choose us.”
- Know where to lose and where to win. It’s a game. A company needs to strategize. Check what and how your competitor is doing and play the game accordingly.