Many companies today face a very competitive market and are looking for a way out to break out. When every competitor is focused on short-term tactics (ie, special sale, drawing for a prize, etc.) the solution only lasts until one of the competitors comes up with a new tactic.
Self-destructive competition is one of the problems W.Chen Kim and Ranee Mauborgo take on with their book, “Blue Ocean Strategy”. For example, if your company is experiencing:
- Margins shrinking
- Competition growing more intense
- Competition driving commoditization
- Rising costs
Too many companies focus their strategic thinking on the competition which puts the competition, not the customer, at the core of their strategy. Stop benchmarking the competition and responding to their strategic moves because it means you look more like the competition.
Instead, put your strategic focus on the buyer and innovate new ways to deliver more value. Note: just because a competitor is doing something, doesn’t mean it of value to buyers.
Think about these questions:
- Which features of your product or service could be dropped because they are not valued by the buyer?
- How much would this reduce your costs?
- What products or services could you add with those savings that would have value to the customer?
If you know someone struggling in an overly competitive market, tell them about this post. Maybe it will help.
