Don’t know your competitors. Know how to beat them!
Across the Pond- Marketing Transformed.
Episode 17: Don’t know your competitors. Know how to beat them!
This week’s episode is going to talk about rising above your competition and getting those competitive juices going. We’re going to look at competitor activity and how to use it constructively to motivate yourself, your company and to improve your offering to your audience and your consumers and your customers.
Marketing transformation is all about how to make the significant step, not the incremental one and done. A lot of the time, it comes from examining the market and finding that clear space, or working out how you can muscle in and create something different, and differentiated from the incumbents and the competition. But, do you need a killer instinct to win at all costs? If you don’t like conflict how do you succeed? And in some markets, the competition may feel huge. Or what if the tables are turned. What if you’re a Blockbuster, sitting pretty, feeling like no one can touch you, but then- you know what happens. What’s your role within your organisation to keep that focus? In this episode we deal with the motivations, the mindsets, the processes and the toolset to keep one step ahead. So, Chris, what’s your competitiveness like?
Well, I think it’s definitely changed over the years to be frank. My school friends used to say, and still say, that I have no competitiveness on the sports field but academically I always took pride in what I was doing and kept one eye on my class mates. Of course I was really competitive with my younger, super talented sister, that was both a source of frustration and motivation growing up. You’ve got to think she was a new entrance into my life, hogging the limelight and those feelings run deep for a while don’t they. But these days, even with sports now that I enjoy doing such as running, I am competitive. I’m assessing how I’m doing against myself mainly but ultimately, it is about enjoyment and satisfaction, but that competitive instinct is there.
When it comes to business, it isn’t necessarily about success at all costs, values are important to me- they don’t go out of the window, but I do like to fight and win smart. And my approach will be strategic and analytical, not aggressive, not based on bravado, in some ways that hasn’t changed since school and in some ways it very much has. I’ve learnt that you must play to your strengths but stay focused and if that is taking market share from the competition then it’s taken share from the competition, you must be focused on that. What about you Sam?
What We Learn from Daley Thompson
I first remember being able to relate to that competitive aspect of my personality through Daley Thompson. He’s a retired British decathlete, who started in track and field and, over time, became an elite competitor. Then he had a particular rival who held the world record many times, this six foot eight German called Jürgen Hingsen and the story I loved about Daley was he’d call Jurgen up on Christmas day and ask if he was enjoying his meal ? his family time? his presents ? and Daley would gleefully declare that he’d been out training and that’s why Daley was going to beat him, he was going to win gold and become the champion. Now, the back story of Daley Thompson is he wasn’t this super impressive athlete, he actually wasn’t naturally good at any single event. So, his coach feeling sorry for him said why don’t you try all of them, that’s what made him become a decathlete and so his mindset drove him to try something, because he wasn’t good at anything he became good at something and it was actually the decathlon. I’m not advocating this ‘work all hours’ philosophy and I don’t want this to be a self-indulgent episode, so I’d say the competitive instinct for me has been driven by setting standards really high. The Daley Thompson thing is setting your standards really high, going for gold, raising the bar and trying to become world class and put the best effort in to get there.
It’s quite an aggressive start and one I hold myself to and one I hold people I work with to. It comes out when I’ve been challenged or perhaps been doubted, and when someone says ‘ what do you know about this? ’ or doubting your application or your contribution, that really gets me to prove them wrong and to push myself to learn, to study, to practice, and persist and in the world of work.
I told a story from episode seven starting with this time when I was leading a project for marketing capabilities, and there was a president from one of the businesses in the first call said “I’m not interested in your bureaucratic training so there’s not much more for us to talk about” and essentially the conversation was over and he had the clout to block anything I wanted to do. I had to really fight to succeed and it lit the flame to ensure that I worked on the program to refine it and make it better. There was data to support the training and the learning I was bringing, the program was delivering a net promoter score of 74 which is pretty good, and there were stories of marketers applying it. But when I came to his team and his business, we actually ran a session that achieved a net promoter score of ninety- almost twenty points higher than the average, and I was very quick to tell them that I’d checked around and tell them that score. And he said “yeah, I checked around town and you’re right they loved it”. So, for me it was a growth mindset example. Throughout the stories I’ve told before, competition is really applying the growth mindset and putting it into practice.
Yeah, a bit of grit there, a bit of dusting yourself off and saying, ‘I can do better than that’.
Know Your Competition
That’s a good question. Over the years I think it has become more instinctive, I think that’s what experience does to you, also confidence and trusting yourself. But at the heart of it is structure. What’s the first thing we’re taught in marketing or should be taught anyway? It’s about what is your unique selling point versus the competition. What’s your competitive advantage? I’m sure you find it as well in your consulting role Sam that still, we have to push products, brands, companies, people on that fundamental principle, that’s really interesting that, still, that competitive context and understanding of how you relate to what’s actually happening out in the wider world is something that isn’t actually there. You’ve got to know your competitors and you have to know what makes you different.
For me as well it comes from knowing yourself and having some objective process for continuous feedback that you actually take action on and so, building on what you’re saying there in terms of knowing yourself, knowing your USP,
how do you know what you want?
How do you know what you’re doing?
What measures do you have in place?
What’s the scorecard?
And what’s the mechanism to hear back?
Did the consumer notice the packaging change or not? You’re asking why and what you’re going to do about it.
Is the sentiment for your brand the same? Is it changing? Why is it changing? How is it changing?
What are you going to do about it?
Who is the competitor that they are thinking about? Is it the same as before?
All these things are bringing data and feedback. When I taught marketing as an adjunct in a number of different places, the first thing I did was actually get data and feedback from the students. You’d hear back from them what they learnt, what worked and what didn’t work, but that meant course correction and it basically made me have to do more work. Because each lesson was dependant on their feedback and their response and it meant adjustments, it meant course corrections and it was the approach that was successful, but it meant more work and it was based on feedback.
I think the interesting thing is you have to have a certain amount of self-belief and self-confidence and focus it on you so, quite often the competition is yourself so, you should see how you improve yourself, how can you beat what you managed to deliver last time?
When I took the role of Marketing Director at The Guardian, we were in a David and Goliath battle with News International and they would spend as much on tv advertising in a weekend that we would spend in a month. Probably more to be honest. Me and the team analysed channels where we were strong and where the customers we were more likely to convert to The Guardian were and concluded that we simply just could not compete on tv. But we were strong, where we could get a good rate of return, where we could win was very much in the digital space. So, I put all our resources into digital marketing, doubled down on that basically, and that’s where we took the market share from. So, we actually came off tv and it was a brave move, and a courageous move but it was distinctly around understanding that sometimes you have to choose your battles to work out how you can outsmart the competition and where you’re going to have a greater impact.
I also think some of that is probably cultural, Sam. Supermarkets, where you and I met, was very competitor heavy I think, it was embedded in that culture about beating competitors at all costs, the same with newspapers. So, I do think some industries I’ve worked with it hasn’t formed as much as part of the culture as some of those Sam. What do you think?
Yeah, I think you can always see a different dynamic and what are the terms of the industry? How is the game being played? How is it running? And I always want to fight on my terms and frame the situation in my favour, which means often challenging the status quo, or challenging the rules of engagement. I recall working on a brand where it was an appliance business and the whole industry focused on being number one. They were the best. They were the bestselling. They had the most features. They were the number one brand. They were the fastest. Widget… You get the point. Everything was always about being the best and banging your chest and sabre rattling, so to speak. But we couldn’t win that game. It was costing us a fortune in product testing, to try and find performance superiority claims or opportunities and looking at the category I thought the brand had a strong heritage and the competitors, the LGs and Samsungs were foreign brands. And so, that could be an angle to dial up because at the end of the day as a marketer, that focus on being number one we are talking about ourselves. And consumers didn’t care that wasn’t about the consumer it was about the brand and manufacture. So, let’s talk about the consumer. Let’s talk about America’s love and talk about their pride of using the product and talk about the benefits that they’d had. It was a huge push back when I suggested talking about the consumer rather than ourselves and so, it was about- thank you for choosing us, you are making us great, no us making you great and we had a huge advantage with that story. Similar to you, it was about changing the rules and perhaps zagging when everyone else is zigging. It often means you are going against the convention or the norm or a status quo of doing things.
Sam’s Three Steps to Competitive Success
1) Think about the customer, the consumer or the shopper. What do they care about? Not what you care about or everyone else cares about, what do they care about?
2) Persist and seek the evidence. Especially if it’s contrary, find the data, dig into it, what does it say? Actually, read it and understand it. What else is also true? It might just be the fact that everyone’s looking at the data from the dominant perspective but is there other data that supports your case?
3) Plan a competitive response. I’ll talk more about this later because if you do something and the competitors and the market takes notice, then what are you going to do when they start to copy you? It’s a game of chess not checkers, as they’d say in the US, or draughts in the UK.
You are right there, you’ve got to anticipate the next move, that must be a core part of what we do, it’s always looking at what the contingency plan is. What’s the plan B? how’s the competition going to act? And if you can’t currently see the competition, it’s working out what it will be in the future.
The Uber Breakdown
Quite often you get various incumbents or even new entrants which are saying well actually there’s no real competitors that do what I do. Well, that won’t be the case for long. There is always someone that will do that at some point. But competition can be healthy as well. Let’s not forget that. Let’s actively encourage both sides of the pond Sam, we don’t live in a monopolistic society and however much we try to resist competition from the business sense, it can improve the choice, the service and upgrade the technology as well.
Let’s take Uber Sam. Operating US and UK wise versus the black cabs, the taxis, the official taxis over in London town. It arrived in around 2012 and absolutely disrupted the industry. First, there was a lot of buzz. They acquired a lot of business, focusing on growth, leaving profits to think about later and actually there was a lot of money put into it and certainly the incumbent- the black cabs- felt that they couldn’t compete at that point. To now where it’s a case of they’ve got the scale and operating in huge amounts of cities worldwide and actually regulation is now coming back again. It’s almost the opposite for the companies, more rules, more taxes, more costly protection for workers and higher prices for customers.
But, the core of it was black taxis felt very very under threat and cheated thanks to what Uber had managed to achieve, since 1865 black taxi cabs have had to study for three or four years, we call it “The Knowledge” in London, and it’s about 25,000 streets and three hundred and twenty different routes and they take absolute pride about that where, Uber drivers, just follow sat nav. Nine times out of ten it does tend to get you there. Occasionally it breaks down, but it does tend to get you there. So, there was a feeling from the black cabs, that they were under threat, they were heavily regulated when there was this new up start coming in, which didn’t need the qualification and didn’t have the strict regulations in place, and they protested against it. However, the other side of it was, there was certainly a few grumbles, despite reputations, customer service wasn’t necessarily as high as it could be in black cabs. Also, there was a very cash rich culture. It was positively discouraged for you to pay by credit cards or any other means, it was very much like they wouldn’t take the fare and it felt very much that you were humble to be in a black cab.
Uber changed all of that. It changed it around convenience. It changed it around feedback culture on customer services. It certainly changed it in terms of the contactless society and driving that. Without Uber, the black taxi trade may not have embraced that as quickly as it did and quite frankly, it took a long time to embrace it. Now, the flip side of all of that is you’ve got a competition, it’s increased the value of it from the services, but in less than a decade it has managed to disrupt that long untouched taxi industry but at the same time now, it’s increasing increased regulation and is now in a situation where it has lost its license in the UK after repeated safety failures. So, it hasn’t actually taken full note of the competition from the other perspective, that providing a service is also about providing a safe and reliable service. I know you have a view on that as well haven’t you?
Yeah, and I think Uber has been a great case study for a number of years of how to do things. Let’s break down what they did well. Like the case studies say, they solve fundamental issues that the consumer had and is really consumer centred experience design,
taxis are not affordable, findable or timely
so, picture the scene you’re in the city, you’ve got a no-miss doctor appointment, it’s pouring with rain, good luck getting one of those cabs.
Uber solves this with technology and its economic advantages; tells you where the taxis are, how far away and when you’ll arrive and gives you the price.
Perfect. But, let’s take a closer look as your started doing and they are actually facing a number of head winds which would have been foreseen I’d say, if they’d done a STEEP analysis. Now, a STEEP analysis is to entrust a framework that’s perfectly applicable when you’re thinking strategically in a competitive landscape. So, I’d apply here.
STEEP stands for social, technological economical environmental and political. That’s the framework you can apply. Living in the US Uber’s experience has been hugely welcomed and hugely successful. But the tide is turning and as you look at this STEEP analysis US listeners probably won’t realise that it’s a completely different story if you study this brand overseas. There’s a huge political pressure as you’ve described, they’ve also been rejected in Germany; they’ve lost another court case there. I lived there for three years and in that country, they have Mercedes and high-quality cars as standards of efficiency, cleanliness and reliability. A hugely regulated industry and they’re being held to those hire vehicle regulations that haven’t been applied elsewhere. They’ve lost their license in London as you’ve said, due to safety concerns and safety regulations. They’re facing social pressures and the EP from that great framework. Deeper disclosures and greater transparency. They’ve had to publish their data on sexual assaults which is really highlighting some serious issues and significant issues. There’s technology concerns and great scrutiny on how you can design a product that isn’t safe for their customers. I could go on using that frame work, so for me having that global perspective and that global experience has been a blessing in my career as it’s made me more curious and aware. But from our audiences perspective- what you can take away from looking at that framework is a way to think about competition and allows you to see more opportunities so that you can build a solution that’s different and better but actually addresses some of these issues that they’re facing overseas and are starting to face in the US.
Whether they foresaw these challenges and chose to ignore them until they came to be a little bit more on the foreground, or whether they didn’t do the analysis I think the point is still the same. That competition works two ways doesn’t it, it’s there and you can work out where you can drive change versus your competitors, but actually if regulation is established to ensure that a competitor is working in a certain way, then your competition is the society itself, and what they demand as standards.
Competition as Strategy
But, you know, some people, also some brands make a virtue out of competition; they positively embrace it. One that springs to mind is very much about the Virgin/British airways dog fight around the airlines, which have been going on for a huge amount of time. Probably since 1984 I think, a long time and still exists. I think it’s a bit more friendly competition than the days of dirty tricks. But I think this illustrates how you use competition to be at an advantage, to really add value and emotion into the brand. September 1999, we had the London eye, that’s a large landmark which I’m sure is familiar to a lot of people across the pond as well, and it was due to be erected. British Airways they owned a portion of it, maybe half or it or a third of it and were going to be a titled sponsor. There were mechanical issues trying to get this big fairground wheel off the ground. Richard Branson, never wanting to miss a PR opportunity, flew an airship oversight and he had a banner from it which said, ‘BA can’t get it up’.
Pretty spontaneous, obviously the mechanical failure with getting it up was only a day or two, so he ceased that opportunity and it worked brilliantly for him. That stunt generated huge attention in the media, and he went on to win a string of MARTY awards off the back of it. And that was very much about using that rivalry, using that competition in a playful way to help drive your brand forward. So, I think that’s a nice example of what healthy competition looks like, but of course it’s not always like that. There was the BA dirty tricks-lible case , which came out but, at the heart of it, it is about identifying opportunities to stand out, cut through, demonstrate your different, and that’s what we talked about in many of the podcasts and that applies the same when you’re targeting your competition. But Sam:
Why do so many big companies fail to see competitors coming at them?
Ok, so the listeners now- listen carefully, get your pens out. So, I’m going to answer the big question as to why. And I think there are a couple of reasons.
Failing to see the competition is more about failing to prioritise the consumer or the customer or the shopper, so for me it’s actually looking at the competition and now your consumers and it’s a business model often that you’ve got working and you’re stuck with it and you’re looking at your competition and you’re just copying them and you’re not really following consumers, and if you think about it there are so many examples of companies that have gone away because they took their eye off the consumer.
You’ve got Kodak who actually invented the digital camera in the 70’s but they stuck with the model of making film and their business relying on that. You have Xerox who created the user experience, PC experience with the mouse and that got pinched by Steve Jobs and Apple and we know the rest of the story with that. Blockbuster, who were more invested in late fees and expensive candy in their stores, so they turned down Netflix when Netflix came to them and said hey, we think this is the future. I worked for a music retailer called HMV which was music retail and they did have some exposure to online and downloading, but they didn’t take it seriously, they didn’t want to be part of that business and you fast forward to today and you see where we are.
So, for me the whole story there is about adapting, it’s about change and there’s a movement started by Greg Verdino who is a business futurist and a digital transformational leader and Ian Patterson who’s a digital strategist, communication and change leader and they had this ten-step manifesto. Now, I’m not going to go through the ten steps here, you can find it at Adaptmanifesto.org, and I’m just going to go through a few of the steps. One of them that stands out for me is embracing ambiguity, and it’s the idea to act on intelligence but in the absence of certainty you still need to move forward. So, don’t let perfection be the enemy of good. So, there’s embracing ambiguity. There is the idea of learn, unlearn, relearn and repeat. The idea that everyone has the capacity to achieve wider understanding, gain new skill sets and develop new mindsets so, you’ve just got to go through this in a systematic and repeated way. The other manifesto element that I think stands out is fund the future. The idea of investing in the people and the processes and the technologies to make adaptation a reality. Be willing to allocate money, rewards and resources to the things you need to do and go after them. That for me is what drives competitive success and it’s the right mindset but all about focusing on the consumer and the customer and less about looking at your direct competitors.
So, get your pens out again, I’d say break it down into three different tiers.
Sam’s Three Tiers
Think about it a bit nearer in. think about it in terms of competitive response modelling so you’re responding to mitigate competitive actions, you’re getting across a functional team or colleagues together to plan what happens if they launch a ‘me too’ product, or they make the same claim you’re making, or if they price match your promotion or if they hire the same contestant from Dancing With The Stars, what are you going to do? So, that’s kind of nearer in.
A medium-term approach could be more like war gaming, which builds a detailed executional plan with resource commitments and you’re bringing across a functional team and leaders together, but you’re actually setting up rooms your immersing competitors, but you’re making decisions and then the budget gets allocated. It doesn’t wait till funding until next year, it doesn’t take next year’s plan, it actually becomes this year’s plan. So, war gaming is something you can do in the midterm but think about a longer-term approach. This is more like a growth ladder.
A three years strategy, which is trying to disrupt the status quo, that is what needs to be true about your business, what needs to be true about your brand, what behaviour changes need to happen, what needs to happen from your customer perspective and you’re resetting the business to fit this new two/three year vision. So, those are the small, medium and large approaches that I would suggest.
There’s some definite lessons there. Choose your battles. Be clear on your strengths. And, be clear that your pockets are big enough, and don’t just look at the competition right in front of you, I think. But interestingly, one area I think where I see competitive action really at the forefront of the role really is around performance marketing really, the fight for market share via search engine marketing and paper click advertising. I think we will come back to that in a later episode and get into the detail there but, I think the fundamental reason is that data is easier to access. So, it allows you to look at driving that share impression, identifying the long tail search where there’s less competition. So, again, data and technology is key there.
But there are some fundamental things to do there, I think. Make sure you have your analytics warning system. Look at the places where the competition isn’t saturated; Snapchat, TikTok. A long tail of search, carving out a niche market. Protect yourself. A lot of organisations don’t take the basic steps such as trademark applications or ensuring that their URLs are in date and renew properly and don’t let emotions run your strategy for you, let the goals and targets do that.
The three takeout’s and reflections of this session
Well we started all this by making it personal. What’s your own competitive story? What’s driving you, and how can you think about it? But, frame it in your own terms before you can then apply it in a business context.
Secondly, have a framework. So, we talked about a few different ones, but the competitive fitness was an example where there’s small, medium and large. How are you going to tackle competition? What’s your framework and process?
And thirdly, it’s about being adaptable. Change is the only constant in life and if you’re in the world of business then there’s going to be competitors to even us out, there’s going to be competition out there. So be adaptable, tap into that ten-step framework from Adaptmanifesto.org. I think that could be a great catalyst for things to improve and for you to compete successfully in the future.