YOUR SELLING and marketing strategy means choosing who you will compete against and on what basis.
If you decide to change your product offerings or your markets, and the customers to whom you are offering your products and services, you change who your competition will be. Just as if you are a country surrounded by other countries and you decide to go to war, it is the direction of your attack that is going to determine all your planning.
A perfect example again is the Steve Jobs/iPhone decision to compete in a completely new area of technology and innovation than Apple had ever been involved in before. Apple saw an opportunity to produce a mobile phone that was completely different from what was being offered in the market, and to introduce new technologies that improved the quality and enjoyability of the phone far beyond anything that Nokia, BlackBerry, or Sony Ericsson were producing.
In choosing the battlefield, you begin with your customer. What is it that your customers of today are asking for or will be wanting in the years ahead? How could you develop or adapt new technologies to satisfy the customer of tomorrow? All market planning begins with thinking about the customer and what you need to do to make that customer happy.
You may decide to change your customer, and go after a market that is either underserved or not being properly served by your competitors. By choosing new customers to satisfy, or new products or services to offer to your existing and future customers, you completely change the nature of your marketing battlefield. You change the future of your business.
Ask yourself, “What are the strengths and weaknesses of my competition in my existing market and in the new markets that I could enter?”
The strength of BlackBerry was its enormous success in providing telephones for businesspeople. Its great weakness was that it became so convinced of its superiority that it stopped technological innovation and became a sitting duck for the Apple iPhone and the Samsung Galaxy when they came along. From being a market leader to bankruptcy was five short years. It would not have happened if the makers of the BlackBerry had devoted as much time, money, and research to improving their product as they did to rewarding themselves with bonuses and dividends.
What are the strengths and weaknesses of your competitors? How could you minimize their strengths and exploit their weaknesses? Where do their strengths and weaknesses offer you market opportunities that nobody perceives at this time?
Simultaneously, you identify your own strengths, and look for ways to compensate for your weaknesses relative to your competition.
Think about competitive response, the actions that your enemy will take to defend and protect his sales and revenue, his customers. If you decide to enter the marketplace with a new product or service, or enter a new marketplace with your existing product or service, or increase your advertising budget to go after greater market share, what are your competitors likely to do? They will not sit there passively allowing you to invade their market, as BlackBerry did.
One of the most famous battles in ancient history was between the Roman army and the Greek army, under King Pyrrhus. At the end of the battle, the forces of Pyrrhus had defeated the Romans but at a cost of about 50 percent of his army.
When someone congratulated him for winning this great battle against the Romans, he made the famous remark that has been quoted throughout history: “One such victory more and I am undone.”
The next year, the Romans came back. Another battle took place. But the forces of Pyrrhus had been so devastated by winning the first battle that he was completely overwhelmed by the fresh Roman army, and lost both his kingdom and his life.
In business, it is very important that we do not achieve a “pyrrhic victory.” It is very important that if you are going to achieve a certain level of market superiority, it does not cost you so much money that the victory is really hollow at the end of the day.
Changing your business changes your competitor, and changing your competitor changes your business. Remember that the actions and reactions of your competitors will determine your growth, market share, and profitability. As a good strategist, you must study your competitors carefully and determine exactly what they might do in response to anything that you do to enter new markets or to introduce new products and services. You should also determine if you can win substantial market share against the new competitor you are thinking of challenging.