Thanks to social media, you can’t really ignore your competitors like you used to. I mean, you can, but it’s a lot more obvious that that’s what you’re doing. You’re both on Twitter. You’re both on Facebook. You’re both using the same tools and communicating in the same space to a very similar group of people.
So how do you handle competitors in this new world? You embrace them and build your business by promoting your competitors, opening the doors to new alliances, potential partnerships and the knowledge that you make one another stronger.
I know, it sounds crazy and all new-agey, but it’s really quite simple. How can you build up your own business by promoting a direct competitor? Here are a few ways.
Realize You’re More Powerful In Numbers
One of the first things many small business owners realize is that they’re more powerful when they can combine resources. Numbers give you street cred and the ability to do more than you could on your own. Keeping friendly relationships with competitors means that when things get slow, you can rely on one another to come up with a plan to help things pick up. You can work together to organize a block party where all the local businesses on the street stay open late to encourage sales. If you’re a local hardware store, you can partner with the other hardware stores in the area to raise money for Habitat for Humanity while building your own brand awareness. You can join together to hold one mega benefit instead of a handful of smaller, easier-to-ignore ones. You can fight together on important industry issues. There are plenty of times where working together delivers far better results than trying to go alone.
Create a Targeted Referral System
There will be times when you can’t fulfill a customer’s request. You may not have the exact expertise, the equipment or perhaps the manpower. By creating a good relationship with your competitors, you devise the perfect referral system for the both of you. I mean, who better to refer you targeted business than your own competitors? A lot of SMBs may be weary to send people off to a competitor, but if you can’t take the business for whatever reason, upping your karma points by sending them to someone who can, is often worth the initial loss. You’ll show your customers that you’re confident enough to send them away (knowing they’ll remember the action and come back) and you also create a lot of goodwill with a competing business who will surely be able to replicate the gesture and sending business your well, as well.
Learn Their Strengths and Weaknesses
What better to learn what your competitors do well and the holes they’re leaving than by becoming buddies and watching their movements? Are you watching them waste money by running newspaper ads instead of engaging online? Do it better. Can you see how frustrated their customers are because they close at 6pm instead of staying open? Do it better. By monitoring and scrutinizing their movement, it helps you make smarter choices for your own business. But you can only learn if you’re paying close to attention and developing that insider relationship.
Loose Lips Sink Ships
Last week I highlighted some of the best competitive intelligence tools available for small business owners. In truth, the best competitive intelligence tool of them all is your direct competitors themselves. Cozy up to your competitor and make them feel comfortable enough to confide in you. My mother used to tell me that, “loose lips sink ships”. When you create friendships, you open the door for them to complain about everything that’s wrong with their business, brag about products not yet launched and you open yourself up as a sounding board for whatever they’re thinking about bringing in doors. I wouldn’t recommend you take their ideas and implement them on your own, but there are definitely ways to use it to your advantage.
It’s a lot harder to shut your doors to your competitors now that the Web and business is forcing us to be more social. Instead of trying, embrace it. Look for ways in your every day to support your competitors while also creating opportunities for your own business.
Thanks for the forward thinking Lisa.
This whole new world of social media is certainly challenging old mind sets and ways of doing business.
It is becoming nearly impossible to operate with a power and control mindset these days because the online tools simply won’t allow you to control word of mouth and sentiment any more. Information is flowing so freely that as small business owners we must co operate together and become allies because in the end we’re all able to build a valuable niche where we can co exist together
As an experienced purchaser I helped out “colleagues” (competitors) in the welding industry when they needed to get raw material and vice versa. It was a small world and we knew each other pretty well and people had worked at different companies in the past. The real competition was on the market place with the sales people reaching out to the end customers, trying to convince them to pick our brand instead of someone else.
I wanted to hear at an early stage from the supplier if they couldn’t deliver according to my request and specific material specification. It was a “trinity” combo of quality, price and delivery (lead) time.
I have been in touch with advertising agencies who are starting to think in new ways when it comes to the new media and marketing channels. It will be fascinating to follow the development and paradigm shift of the media landscape.
Loved this article and have a very recent first hand experience that supports this. I was providing marketing consulting to an early stage Internet Television Startup and we were creating the business plan and financials. Since iTV is fairly new, we were using a lot of best guesses and estimates.
I finally suggested that we simply reach out to some of the other Internet Television sites and ask to speak with their CEO’s. Long story short, 2 of the 5 CEOs agreed to meet with us and shared very detailed information about their strategies, key learnings and “getting started” advice. The few hours we spent were invaluable!
Since the meetings, we’ve continually promoted both of the competitive iTV sites on Twitter and other mediums. We got help, they’ve gotten ongoing, free advertising and WOM.
I read some great articles on this site, but this is not one of them. Promote your competitor and you’ll grow your business? Ok, I’m interested. Then I read it and little actually supports that assertion.
How is learning their strengths and weaknesses or cozying up to them as a supposed friend promoting their business? The former is just Business 101 and if you do the latter, you have bigger problems. The idea of promoting your competitor has merit, but this article fails to make the case.