TUITION FROM COMPETITION

Rivalry amongst sellers in a constricted market space is customary and companies incessantly battle it out, because the arena is extremely lucrative. The toughest competition is witnessed in the highest demand markets and a couple of percentage shifts in market share changes the dynamics drastically. History is replete with rivalry; Ferrari vs. Lamborghini, a 47-year-old sustained feud, Coke vs. Pepsi, the mother of all ‘dog eat dog’ unmerciful rivalries, Reebok vs. Nike, Airbus vs. Boeing, Ford vs. GM, HP vs. IBM, Apple vs. Samsung etc.

Microsoft vs. Apple rivalry is legendary. Gates in 1997 bailed Apple out of a very close bankruptcy with an investment of 150 million that consequently transformed the personal devices industry. Apple resurrected and rose like the sphinx to eventually take market share not just from their competitors (Motorola, Nokia, Sony Erikson, Blackberry) but through their high-octane inventiveness, they obliterated many firms/products the likes of cameras, Walkman’s, HP’s PC operations, Kodak, Intel’s PC business (though their chips do support 2007 onwards MAC products) and others.

It is a cognitive cistern out there if one were to collate the learning from these competing firms or brands. Fine-spun messages, trickery, razzle-dazzle, guile, lifestyle based adverts, savvy campaigns, exhibitionistic displays, theatrical launch presentations and hordes of others lure clients into a real or perceived sense of exclusivity eventuating in product/service loyalty from buyers. Competition is always alert to understand the ongoing marketing blitz.

WHAT IS THE NEED TO LEARN FROM COMPETITION

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Inventions are sensational. First movement and the pride of originality decidedly rules the roost after all they have spent all those blood soaked years toiling but the volume and frequency of these inventions are few and far between. We have hoverboards, smart watches, bendable batteries, smart contact lenses, Google glass all these are categorized as inventions but delve into it a little more and they seem more like innovations over existing products. Innovation and whilst upon it, sustained innovation, can be stated to be the order of the day which is what firms like Apple, 3M, Google and others do. Reconstructing the familiar or improvising over innovations is next in the hierarchy and Samsung has done a good job of it. They were the fastest to learn their lesson from Apple who subjected the phone, music and Internet to ablution and introduced the iPhone. Samsung unhesitatingly and steadfastly improvised and improved the product with an appetite for the absolute, which Motorola, Sony Erikson, Blackberry and others couldn’t do.

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Inventiveness and Innovation takes immense grit, imaginativeness, discipline and foundational core and not every organization is geared up for it. Vast majorities embrace ‘marginal differentiation’; a few bells and whistles here and there. Most organizations love to play the truculent advertising, combative marketing and coercive selling game. A few succeed at it and many get burnt to a crisp. Throwing more bodies into the selling arena does not always lend luster to the firm’s revenues. Stirrings of distinctive product/service vision must reverberate in the boardroom for the firm to train blaze with innovation.

Adoption of the improvisation model blots out differentiation as newer firms or other firms will eventually catch up and do better hence commoditization looms large. Competitor information in such firms becomes an indispensable strategy to keep one’s neck above water. Firms unable to introduce innovations take the easier route of infringing upon patents and most technology companies are mired in patent wars and litigious IP infringement fights. The cumulative payouts thus far have been staggering yet firms indulge in it as the rewards often far outweigh the present punitive measures administered by the law. This method of learning from competitors by copying key aspects of each other’s patents resoundingly conveys that it is one of the most expensive ways to learn. What then are more economical and ethical means of doing so?

13 CUES ON HOW TO LEARN ABOUT COMPETITORS

  1. Customers: Existing customers know a great deal about competition and to elicit the best deal, price etc. often divulge aspects such as differentiators, benefits received from other firms etc. For the value and consultative expertise that your firm offers the customer, they could express their indebtedness with key information. Not as a snitch and customer spewing confidential pieces of data but rather a gentle nudge into certain line of thought in the ensuing discussions between seller & client.
  2. Suppliers: Most suppliers are common as they offer the same products to competing firms. Sharp, Qualcomm, ST Microelectronics all supply products to both Apple and Samsung. Developing excellent relationship with suppliers/vendors merits special attention as a lot of high value information passes through these exclusive channels. One has to apply high sensitivity in seeking such information, as suppliers are wary of respective interests.
  3. Scouring websites: It would be a no-brainer to suggest so, after all everyone does it. This unquestionably is the perhaps the first port of call. Sensible firms these days, with clever SEO optimization strategies, make themselves appear on the first page of Google. Find out what is happening in such firms, what key words do they respond to etc. There are key word monitoring tools such as KeywordSpy, iSpionage, SEMrush, The Search Monitor etc. to assist. Go beyond active search, set up Google alerts on competitor companies.
  4. Annual Reports: Marketing/ Sales personnel must remain curious and learn to interpret, distill and extricate competitor intelligence from annual reports, media news, documents, shows etc.
  5. Events & Exhibitions: The promotion strength of a firm is seen at key industry events, trade shows, conventions, conferences. Firms doggedly try to assert their technological and innovative presence during these launch events hence temporarily divested from their defenses and is quite forthcoming with information.
  6. Engage with competition: A very brazen approach is to directly engage with competitor. Even if both are wary of each other, have the courage to interface as even though one need not divulge specific company or deal related information, other meaningful discussions relating to the industry and generic direction could emerge. Mature sales personnel often do this with equivalent sales teams of the competitor’s firm when they meet at events.
  7. Social Media: LinkedIn, Twitter, Facebook (business), Slideshare and innumerable engagement tools exist. It is not luxury but mandatory to adopt a pro-active stance towards these forms of social media. Be a blogger on topics pertinent to your market and domain. This should attract advocates, influencers, customers, vendors and others to engage with your topic. Through the value that blogging invokes, key C-Suite LinkedIn members will connect up. Whilst blogging, do it with a spirit of integrity and intent to contribute as against using it as a strategy. Become a thought leader in the chosen field.
  8. Digital Tools: The digital arena is a remarkable resource to seek competitor information. There are innumerable Ad monitoring tools the likes of Moat, MixRank, AdGooroo, Adbeat and so forth that helps in competition monitoring in the digital space.
  9. Marketing Teams: Firms own marketing team must involve on an ongoing basis to follow specific companies and provide enriched and condensed information to the sales teams. Competitor information is not a one-off brilliance, it is an unrelenting task and to be done with vigor and intensity.
  10. Career Page: Whilst scouring through competitors website, find out what jobs are they hiring, in which functions, technology etc. In 2005 when Silicon Valley was ablaze with demand, Apple’s Steve Jobs and Google’s Eric Schmidt artificially pushed worker’s wages lower by agreeing not to recruit from each other’s firms but such practices are illegal. These days, hiring competition is a commonplace strategy. Top talent bring colossal competition knowledge. In 2011 more than 150 McKinsey alumni were running companies with more than $ 1 billion in annual sales and a few years before this 70 past and present CEO’s of Fortune companies were McKinsey alumni. People from ‘varied exposure’ backgrounds bring considerable knowledge with them.
  11. Hire authentic agencies: For a decent sum, there are professional agencies who present industry analysis, trends, competition behaviour, mega trends, research reports and so forth.
  12. RFP participation: Many organizations float RFP’s (request for proposal) for large deals. Seller’s firm participating in such RFP’s is a very involved and expensive process however regardless of whether one win’s or loses the deal, it does generate a lot of insight and interaction with the buyer, a conduit from where competitor information flows. Since it is an expensive process that consumes significant bandwidth, firms try to weigh their chances prior to participation.
  13. Others: Engaging with financial analysts, stock market pundits, trade journals, newspapers, PDF documents, white papers, patent databases, catalogs etc. all of these educe competitor information.

CONCLUSION:

There are techniques such as pseudo purchases (ghost shopping), calling the customer and posing as an interested buyer and hordes of others. Firms do indulge in these theatrics however such appropriations lack integrity and coagulate as cheap stunts. A firm must, in addition to instituting a structural configuration in accumulating competitor’s knowledge, must have the voracity to learn from competition and not merely be well apprised and watch what is happening.

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Systematizing and strengthening a marketing and sales engine to keep generating competitor information and weave it into intelligible data to aid decision and action, must be a compelling mission and a function that demands intense follow-up, guidance, supervision and periodic review. Any indeterminacy on this front may have survived thus far but assuredly will not withstand the prevailing combative digital onslaught of the present and future. The function of seeking competitor knowledge is like a Meerkat strategy, it performs the role of a sentry and remains watchful and on high alert but in doing so, offers the firm longevity and reprieve from others eating into its cash cow product/service. Either one could go the linear way with this strategy or take the more aggressive and exponential way as Jack Welsh puts it, ‘Number one, cash is king….. number two, communicate…… number three, buy or bury the competition.’

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