8 reasons why you should love competition

Sun Tzu already said: if you embrace your enemies, they can’t attack you. If asked for, most business owners will mention competition as one of the biggest pains in their asses. Here’s 8 reasons why competition doesn’t deserve so much credit.

1: Innovation

What would’ve become of the iPhone if Android and Windows hadn’t decided to start competing? Competition creates deep innovation. A basic idea can be strong, competition makes it the strongest it can be. Look at what competition did to the industry of gas stations. For gas station owners, gas has become a side-product, and the real profit is in all the extra’s. Customers benefit greatly from this competition, because you can now shop commodities at the gas station and fill up the car relatively cheap (haha, gas prices are at their highest ever at the moment)… But it’s the idea that counts, obviously.

2: Adoption of ideas

You have a striking new idea. World-changing. Now, imagine getting your unique, one-of-a-kind message across. Pfhew, that’s alotta work, don’t you think. Evangelizing takes a lot of effort, so you better share the burden, so people will actually understand and underwrite your innovative business ideas. Competition creates awareness.

3: Competition equals respect

In a way, competition creates respect for each other’s determination, efforts and different approach, but also for one’s position in the market. Often, you see fierce competitors enabling each other to grow and dominate the market, because these competitors know they need to push their limits every time. And quite a lot of the times these competitive companies end up dominating their own piece of the market, leaving the competition behind and respecting the position of the other, successful competitor(s).

4: Competition means life

There’s two situations when you have no competition: Either you’re in a very, very blue ocean in a very, very, immature market, where cash flow surely is a big problem, or you’re market has died while you were busy doing other things.

5: Monopolism sucks

If you’re a monopolist, where’s the external drive? Who makes you get to the office at 6 in the morning, and leave 12 hrs later (at least)?

Let’s say that, hypothetically, you’re not the market leader, but you want to be. This gives a fantastic point to focus on: beating the market leader. Of course, never stare yourself blindly on the competition, but follow your own path.

6: Let competitors lure in your customers

Have you ever heard the story about the recruitment agencies who decided to clutter together in a street? No? Well, that is what they do. Because if someone is going to apply for a new job, he’d rather go to a street with a multitude of agencies, instead of travelling throughout town in search of another agency. In this way all the agencies benefit from each other’s presence.

In a competitive market, you might not want to be using products or services of competitors. But what if you’re own solution is substandard, and therefore lowers the total quality of your product? In order to optimize your user experience, perhaps you should then consider implementing parts of the solution of the competition, find another niche to fill or accept the delay and work very hard to improve your product by yourself or with other third parties. The downside of the last option is that you need resources, you lag behind and need time, losing grip on the market. Currently, Apple is in this position with their maps and standard set of apps on the iPhone5, as read on http://www.cultofmac.com/192350/how-apples-obsession-with-google-is-hurting-apple/.

7: Claim your own market

Competition means there is demand for this solution, thus there is a market. Together with the competition you claim the market. Together you’re the first movers, the originals. Create a market association and claim authority. With no competition in a market, you won’t have a lot of authority as well, will you…?

8: Are you the market leader? Really?

Being a market leader, and thus the leader of the pack, is relative. If you define your market proposition narrow enough, everybody can be a market leader. What’s the point? Use the benefits of competition and raise the bar.

About the author

Over the past few years Walter van der Scheer has been evangelizing marketing automation to advertising agencies, e-commerce companies and co-workers alike and has been building a team of determined sales professionals. He has made progress, but the road ahead is still very long. Walter shares his personal experiences and challenges along the road of changing the way that marketing is done, while trying to stick to the strategically chosen path. +

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One Comment

  1. David October 28, 2012 Reply

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