One of my clients is facing two very unscrupulous competitors operating in his local area.
They have copied the broad layout and approach to their websites, they’ve copied much of his marketing and business idea. But they are selling at lower prices.
He’s been incredibly frustrated by these thieves and has asked me for my opinion on how to deal with them.
Simply dropping his prices isn’t an option. He offers a superior service and cutting prices would hurt his margins too much for the long term of the business.
It would prevent him from reinvesting to improve and develop, to stay one step ahead continually.
The only sensible answer, if he wants to continue to dominate in his field, is to be better than them in order to delight his best customers.
That means better service, better marketing, and better product.
Apple vs The World
In 1984, Apple unveiled the Macintosh, the first widely available computer with a mouse along with a graphical interface instead of just plain text on the screen.
It was a massive breakthrough thanks to Apple taking an idea that was created by Xerox but not doing anything further with it.
But what happened?
Microsoft took the idea and used it for themselves to create Windows. Apple didn’t respond quickly enough with an improved Macintosh and so Microsoft stole the #1 spot and have dominated the desktop computing world forever after.
But Apple bounced back about 10 years ago, realising that they could do MP3 players far better than anybody else.
When they launched the iPod, industry watchers didn’t think it would succeed.
Now iPod is the dominant one, because it was designed to be the best from the start.
What To Do When You Get Ripped Off?
First of all, if you can reasonably do so, protect your unique intellectual property through patents and copyright.
But even this won’t cover you completely – you can patent or copyright specific things, but not ideas.
So for my client’s business, with these competitors continually hounding him, the best thing to do is take the high ground.
First of all, he needs to review his business model to make sure they haven’t figured out a better way to do things, more cheaply or more effectively.
If not, they must simply be earning less money.
Next, he needs to focus his actions and priorities to continue to grow by out-marketing, out-selling, out-promoting and out-performing his competitors.
Let them share the low value, late paying customers between them while he concentrates on those who value the quality of service he provides.
He should avoid talking about his competitors, instead positioning himself well above them.
After all, they’ll not thrive and excel in business if they are cut-throat cheap operators.
And he’ll become known as the quality operator in his field, who provides the best service and is therefore worth more to those who appreciate better service.
Competition Is A Fact Of Life…
It’s inevitable wherever there is a need that people for which people are willing to pay.
It’s the basis of the free market economy in which we live.
Apple invented the touch-screen smart phone when they unveiled iPhone.
That didn’t stop anybody else from copying the concept to come up with another touch screen mobile phone though.
Google released Android shortly afterwards and dominates in terms of volume of sales, through all the differnet Android models that Samsung, HTC and the rest are making.
And despite Android being a blatent rip-off in terms of “look and feel” of the iPhone, patents and copyrights have been unable to protect even a multi-billion company like Apple from this kind of intellectual property theft.
So how do Apple maintain their focus?
They remain resolutely on the high ground – their products are the most expensive and easiest to use. For those who like the Apple experience, it’s worth every penny of the higher price demanded.
That’s why Apple has just 9% of the total mobile phone market, but makes 75% of the total profit in the market.
Not a bad position to be in, really, is it? Gives them the power to re-invest and stay ahead.
So don’t worry about what your competition are doing.
Do what you do, better.
Aim to be the best – consistently.
Don’t let customers down.
Don’t let standards slip.