Be Thankful For Your Competitors

Why should you be thankful for your competitors?  That’s easier to answer than you might think.  Competitors make you better because you are challenged all the time to up your game.  You can’t lose your edge when you are the hunter or the hunted.

The Chess Game

If you have ever played the game of chess, it’s a strategy game where you have to out-think your opponent.  They make a move and you have to make a counter move.  You have to always be one step ahead of your competitor.  One wrong move can dramatically affect the outcome of the game.

Knowing your competitor’s next logical move can help you beat them.  You have to get into their head.  Think the way they think.  Understanding your competitor’s strategy is only part of the game.  You also have to understand what your customer’s needs are.  That too can affect the game.  If you are focused too much on what your competitor might do, you might lose sight of what your customer’s needs are.  Too often I got caught in a pricing war with competitors.  If they dropped a product’s price by 10%, we would drop it by 15%.  We found that didn’t dramatically impact our sales.  When talking with our B2B customers, they were more interested in finding the products they needed as quickly as possible versus saving a few dollars.  Their time was more valuable than the potential savings sifting through promotions.  To the competitors, it was all about promotional pricing.  However, to our customers, it was all about saving time.

Be Aware of Your Surroundings

When you have strong competitors, it makes you much more aware of everything that is going around you.  You become more sensitive to your competitor’s messaging in emails, print and online.  Your competitors are fighting for the same customers that you are.  What is your differential advantage?  Do you offer better customer service?  Are your hours of operation the same or better than your competitors?  Is your website search engine optimized and easy to use?  Find your weaknesses and fix them to make them strengths.  If you don’t know what your weaknesses are, ask your customers.  Your competitors probably already know your weaknesses.

Keep your eyes open for new competitors.  The competitive landscape is always dynamic.  If you are profitable in your market, rest assured someone else is going to figure that out.  IBM owned the computer market for years.  Dell, Gateway and Compaq went hard after that market and upset the balance of power.  Today, Apple, Lenovo, Acer, Asus and HP to name a few are in the ring.  It is difficult in today’s marketplace to stay on top of the mountain.  Look around.  You’re not alone and don’t be surprised if companies that you never thought would ever be competitors are now.

Competition Can Make You Stronger

Look at the constant battle for market share between Coke and Pepsi.  They are always taking swipes at each other and try to “one up” the other in their marketing and advertising.  Coke introduced “Share A Coke” using personalized cans and bottles.  Customers were looking for soda cans with the names of their spouses and friends to share.  This was a very successful branding campaign.  Pepsi did a counter television ad where two women are standing in front of Pepsi and Coke vending machines one holding a bottle of Pepsi and the other a bottle of Coke.  The voice over announcer tells the women that this summer they can win tickets to the concert of their choice every hour, but only with Pepsi.  The happy woman holding the Pepsi bottle says to the other woman “At least your name’s on the bottle” and the women holding the Coke bottle says “Do I look like a Larry to you?”  Punch…counter punch.

The battle between Coke and Pepsi has made both companies stronger because they are constantly reinforcing their brand and introducing new products.  Sometimes it is very successful and sometimes it is not.  Take “New Coke” for example.  Coca-Cola decided to introduce a new recipe that tasted more like Pepsi and retire the original Coke on April 23, 1985.  It was a huge marketing disaster.  Loyal customers revolted against Coke.  Doing damage control, Coke reintroduced the original Coke as “Coke Classic” on July 11, 1985, but the damage was done.  Despite the focus groups and 200,000 taste testers of New Coke, Coca-Cola didn’t realize how attached their customers were to their brand and the original Coke. Pepsi took advantage of Coke’s marketing blunder and launched a new commercial “Why did Coke change?” using a teenage girl questioning why Coke changed  She then drinks her first Pepsi, smiles looking into the camera and says “Now I know why.”  Competition has made both companies stronger and better.  The ultimate winner is the customer who gets a better product often at a better price.

Although many companies don’t want to admit it, competition makes you better. They make you much more aware of your strengths and weaknesses so you can improve and keep your eyes open for new competitors.  Your products and services are constantly being compared by customers and competitors, so you need to be the best you can be.  Isn’t that what we all want?  Thank you competitors.

If you want to learn more about me, please visit my LinkedIn profile, my website and my blog.

Photo credit: La Shola y EL Gringo? / Foter.com / CC BY-NC-SA

Leadership – Learn from the Past, Thrive in the Present and Plan for the Future

True leaders learn from the past, thrive in the present and plan for the future.  Too many leaders focus on one or two of these elements, but not all three.  Without the proper balance, it is more difficult to get where you want to go.

Learn from the Past

Winston Churchill once said “Those that fail to learn from history, are doomed to repeat it.”  I believe this is true.  When you ask leaders why you do something a certain way, it’s alarming to hear “Well, we’ve always done it that way.”  That answer begs the questions the following questions.  “Is it still the right way to do it?” or “Is there a better, more efficient and cost effective way to do it?”  It is very easy to fall into the trap of continuing to do things a certain way because of process deficiencies or technological limitations.  If your ERP system can’t do what it needs to in order to move your company forward, then maybe it’s time to look at a new ERP system.  I know it’s expensive and painful.  I’ve lived through a few ERP system migrations.  If you live in the past, you will stay in the past.  The past is a great teacher for the present and the future.

Before large screen, high definition video, new car announcement shows often used large screen, multi-projector synchronized slide shows.  The images were crisp and clean, and with the images synchronized to powerful music, it was a sight to behold.  I know because I used to program them earlier in my career when I was in Cleveland and Detroit.  When large screen, high definition video became a reality, the market for multi-media slide shows quickly died.  Companies that had built their businesses on 35mm photography for these shows, slideshow creation, and multi-media programming either had to morph into something else or go out of business.  At the time, many of those businesses said that this high definition video thing was just a fad.  Tell that to Sony, Samsung, Vizio, Panasonic and LG.

Great leaders understand their company’s history and learn from past failures so they don’t repeat them.

Thrive in the Present

Thomas Edison probably didn’t wake up one day and say to himself “Hey Tom, we need to invent a light bulb today.”  He looked around in the present, saw the need for something that didn’t exist and found a way to make it.  It wasn’t easy and he failed more than he succeeded, but it was through the failures that success was born.  There were other sources of light before the light bulb was invented, but he saw the need to innovate and create something better.

Let’s talk about breakfast for a minute.  When I was growing up, it was common for families to go to a restaurant like Big Boy, Denny’s or Bob Evans to have a nice breakfast.  In 1972, McDonalds introduced the Egg McMuffin and five years later, a full breakfast menu.  The breakfast landscape changed.  Today, coffee, donut and other fast food chains like Starbucks, Dunkin’ Donuts, Taco Bell, and Burger King are all getting deeply into the breakfast food market.  Not to be out marketed, McDonalds decided to offer an All Day Breakfast Menu in October 2015. Keeping your eyes on your existing competitors and watching for new ones is always on the mind of effective leaders.

Great leaders are aware of the business landscape of the present, know who the competition is and what needs to be done to compete and grow. Sales and revenue growth are important, but so is creating a working environment that draws the best talent that is out there.  Creating a workplace that is safe, fun and emphasizes a great work-life balance is critical. Customers like to do business with happy people.  Making employees happy today will make your company thrive tomorrow.

Plan for the Future   

Great leaders are future thinkers.  They don’t just look at where they have been or where they are, but they know where they want to go and have a plan to get there.  Although you can’t always predict where technology might take you, or what is going to happen in a global marketplace, you can decide how to get there today and make adjustments to your plan as the technology and business markets become more defined.  Did Blockbuster see the evolution of VCRs and Betamax to DVDs?  Did they see that the corner brick and mortal stores were going to be replaced by Redbox vending machines and streaming movies from Netflix, Amazon Prime and various flavors from different on demand channels?  No.  When that title wave came, they had too much invested in brink and mortar stores, they couldn’t recover quick enough.  Dish Network purchased Blockbuster in 2011 and by 2013 the brick and mortar stores were closed.  In 2015, “Blockbuster@Home” was renamed “Dish Movie Pack”.  As innovative as Blockbuster was in the early 2000’s, they didn’t see that technology would quickly overtake them.

Be honest, did anyone think 20 years ago that computers could be smaller than an 8 ½ x 11” pad of paper or that you could watch your favorite TV show, movie or sports team on your phone or you can listen to music on a device that is smaller than a pack of gum? Did anyone think that Dick Tracy’s wrist phone or Marty McFly’s hoverboard from Back To The Future II would be real? You might not be able to predict exactly what future technologies will be, but you can predict change and innovation.  It’s coming.  Be ready for it.

Learning from your past and not repeating the same mistakes is one leg of the stool.  Thriving in the present including understanding your marketplace, competitors and making your company a great place to work so your employees pass that enthusiasm onto your customers is the second leg of the stool.  Planning for the future by be being aware of technologies, domestic and global markets that will impact your business is the third leg of the stool.  You need to use all three to be an effective leader.

If you want to learn more about me, please visit my LinkedIn profile, my website and my blog.

Photo credit:  http://vividscreen.info/pic/future-present-past/19169/for-800×600

Making the Leap from B2B to B2C

Can B2B companies make the leap to capture B2C customers?  It isn’t always as easy as it seems.  Here are a few things that I would recommend reviewing before making that leap from B2B to B2C.

Will Retail Customers Like Your Products? – This sounds like an obvious question, but you need to find this out before investing in a marketing strategy for retail.  Oftentimes, a product that sells very well in a B2B environment, doesn’t sell well in B2C.  I worked for an industrial supply distributor and we wanted to increase our sales for our best selling products.  When we posted 50,000 products on Amazon.com, something very interesting happened.  Our slow moving products in B2B were our best sellers in B2C.  We thought that we knew what the retail consumers wanted, but we were wrong.  Customers don’t always behave like businesses.

Are Your Products Priced Correctly? – You need to do some market research regarding the products that you want to sell in the retail market.  If your products are similar to others in the marketplace, then do some competitive pricing analysis.  If you have a unique product, you need to determine what your pricing strategy is.

Is Your Infrastructure Set Up For A Direct To Consumer Market? – When selling your products to the B2C market, are you set up to sell individual products instead of bulk shipments?  The B2B companies that I have worked for were already set up to handle large numbers of individual orders.  Not all companies can handle a huge influx of individual orders.  Make sure that your company can handle whatever the retail market throws at you.

Does The B2C Market Know That Your Company Exists? – Wanting to sell products that historically have been marketed directly to businesses may not be thought of or exposed to direct consumers.  You will need a B2C marketing plan.  How are you going to get the word out that you sell to end consumers?  You may need to invest in print and online advertising to let customers know what your company sells.  Press releases are also a good way to get the word out.  Google Adwords and Social Media are another way to get exposure online.

Know Your Target Audience – The best way to expand in new markets is to talk customers that you want to target.  Focus Groups and surveys are great places to collect information about your market.  Understand what motivates customers to purchase products.  Thanks to Amazon and other retailers, free shipping and discounts are some of the rules you need to understand in B2C markets.  End consumers don’t always behave the same way that businesses do.  Price sensitivity is a serious challenge especially with highly competitive products.

Understand How Your Existing Customers Will React To Your Company Going Direct to Consumers – It can get a little tricky when you move into a consumer market, especially if you have a distributor network.  I worked for several companies that sold directly to businesses and to distributors.  In that scenario, you need to make sure your distributor base isn’t threatened by your selling to businesses.  This issue can even get more convoluted when you add selling to retail.

Do your homework before making the leap to B2C.  If you make sure that you research whether the B2C market will buy your products and at what price point, ensure your company’s infrastructure can handle the potential influx of individual orders, build a solid B2C marketing plan and understand how your existing customers will react to you expanding into new markets, you should have the framework for expansion into that market.

If you want to learn more about me, please visit my LinkedIn profile, my website and my blog.

Photo credit: Nicholas Eckhart / Foter.com / CC BY