Monday, June 16, 2008

Know your competition

Perhaps you dream that you will triumph so completely over your competitors that they will finally say, “We give up. You are the best. We’re getting out of the business.” You'll then be alone, victorious, atop the mountain. Don’t wish it to happen too fast, though, because your competition is essential to your initial success. If a prospect asks you to name your top three competitors, do not say, “Uh. Gee, that’s a good question.”
If you can't name your competitors, your prospect will likely think one of three things:
1) You’re uncomfortable with comparisons to your rivals (not so good).
2) You haven’t done your homework (bad).
3) Your product is so far off the mark that no other company has thought it worth developing (time to punt).

It's usually easier to sell something if you’re not the first to sell it. You'll need a marketing position, and it’s a lot easier to establish one if you have something or someone to position against, such as a rival.

Maybe you really are so far ahead of your time, so visionary, that you’ll have trouble finding significant competition (other than the inaction of your prospects, which is always the toughest competition). If that’s the case, sales will come a lot harder. It is tough enough if you are a new company and no one has ever bought your stuff before. It is exceptionally difficult if no one has bought what you are selling from anybody else either. You say you’re bigger, faster or friendlier? Than what or whom?

The more clearly you can understand your rivals and understand how they compare to you, the better your position will be with your prospect. Most prospects are reluctant to sail uncharted territory when their image and money are on the line. For every visionary out there, ten prospects will be timid about working with a new company. You must generate in him the confidence that he will not be GOING WHERE NO MAN HAS GONE BEFORE. That is no place for most would-be customers. It is possible to convince a prospect to take a chance on a company that has no customers. It is a lot more difficult to convince them to be the first to buy something that is an entirely new concept.

Competitors offer proof of concept. Prospects will take some comfort in knowing others are in a business similar to yours. You can take comfort in that knowledge, too.

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