Article courtesy of Joe Gracia with www.GivetoGetMarketing.com
Today's article is about competition and how to deal with it.
I have a product that is in very high demand. But lately I have been losing a lot of business to a competitor from India who is selling a lower quality version for a lot less money. What advice do you have to fight competitors who take away your business with cheaper products and prices?
-- Greg, Santa Rosa, NM
Thank you for your note and your marketing question.
Obviously, without the details of your particular business and market situation, etc. it's difficult to prescribe specific solutions.
However, I can make some general observations and suggestions.
Competition Will Always Be Here
Everyone has competition. As soon as there is an opportunity for profit there will be others who will jump right in to get as much of that opportunity as possible-- and they don't care how it affects you or your business. If they can put you out of business and take all of your customers, they will. That's the capitalist system. And in my opinion, it's a good system. Cream rises to the top.
Remember you are someone else's competitor.
You said that your competition from India sells a product of lower quality, and you sell a higher quality product.
If that's true, then you are both essentially selling different quality versions of a product to different markets.
There is a market for lower quality, lower priced products, and a market for higher quality, higher priced products. These are different people.
The people who want higher quality, are not in the market for lower quality versions. And the people who are looking for lower priced products aren't looking for higher quality, higher priced versions.
There are people who want inexpensive pens that can be tossed when they run out of ink. And then there are people who want expensive pens that they will keep forever.
Again, those are completely different target markets.
You need to focus on 100% of your time and energy on 'your' target market of quality seekers.
Your goal should be to attract the quality seekers to your business, and then show them why your product is higher quality.
Tell them about all of the benefits that your product offers. Tell them about the advanced features. Tell them everything they want to know about your higher quality product. They want to make sure they are getting what they are looking for, so tell them everything they want to know.
Give Them What They Want
Marketing is all about giving people what they want.
In general, they want
-- products and services that solve their problems or help them achieve something they want
-- they want good prices
-- they want the best overall value they can get
-- they want excellent customer service
-- they want convenience
-- they want hassle-free guarantees (stand behind your product)
-- if they're unhappy with their purchase, they want to know that they can get their money back
-- they want the buying process to be easy
-- they want social proof that your product and your business delivers what it promises (testimonials)
etc. etc. etc.
Forget About Your Competition
I will tell you exactly what I have told every one of my past clients; don't focus on your competition.
They will always be there. And they will be working hard to take away your customers.
Of course you should know what they are doing, so that you can learn from their successes, but you need to spend every minute of your time focusing on becoming more valuable to your customers.
Forget about your competition and instead compete against yourself. Develop an attitude of continuous improvement in your product, in your service, in your business systems.
Focus on becoming a better and better marketer. Test new strategies and compare the results so that you can find higher and higher benchmarks. If you send out a direct mail letter to your list of customers (you do market directly to your list of customers, right?) then keep accurate track of how many letters you mailed and how many responses you received. If you mailed 1,000 and got 10 responses that is a 1% response rate. Then try to improve your offer in your letter so that you can get a 2% response rate.
That increased response means that you have just found a way to offer your customers even more of what they want. When you do that, your responses go up.
Keep doing that with every aspect of your marketing and you will continuously improve your sales and profits.
You can never succeed by focusing on your competition--only by focusing on your prospects and customers.
Compete Against Yourself
The absolute best way to eliminate competition worries is to become a better marketer. You simply must market your business in a superior way.
You've got to start competing against yourself, instead of competing against others. Continuously improve your marketing systems, and compeitition worries will disappear.
Very often when a new client tells me that their competition is having a negative impact on their sales, I find just the opposite is true.
It is in fact, their poor marketing and management practices that are having that negative impact on their sales and profit.
Once we improve their marketing and management systems, miraculously, the negative impact disappears and their sales and profits begin to flow unimpeded.
That's good. Because there isn't much you can do about your competition except to improve your marketing strategies and systems.
Here are the four marketing skills you need to continuously improve:
1) Learn to attract more and more qualified prospects to your business
2) Learn to convert more and more of those into First-Time Buyers
3) Learn to convert more and more of those into Repeat Buyers
4) Learn to convert more and more of those into Advocates who refer their friends, family and associates to your business. If you'd like to learn simple, step-by-step ways to do the above, you may want to consider my course: