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Dealing with Competition
by Admin ·
Today, excessive competition is one of the main problems that face any company.
The constantly increasing competition for all companies, even companies that started operations with little competition, soon threatened by the emergence of new competitors (especially if the first companies to begin to succeed) that will make every effort to snatch a share of its market.
Competition is increasing, and if companies do not take the necessary steps to address it, is likely to be overtaken by it, and even lose much of its market.
Here below the main ways to address legitimate competition:
Analyze competition
One way to cope is to analyze the competition, which means knowing it well, collect and analyze this important information, be aware of what you do, try to anticipate their actions, etc.
For that, we buy their products, make use of its services, visit their premises, analyze their strategies, interviewing his former employees, interviewing clients, etc.
The competitive analysis will allow us to make decisions and design strategies that allow us to compete properly with it, for example, if in our competitive analysis we discovered that one of its weaknesses are its high costs and therefore its inability to keep prices low, we can choose to reduce our prices.
Reduce prices
A common way to cope with the competition is lowering prices below the price of it.
This practice can be a good way to compete, however, we must be careful as it involves reducing our profit margin and it is also likely that competition also decide to reduce their prices.
Before using this practice, we must ensure that we are able to reduce our costs without sacrificing the quality of our products, and that the price reduction is a strategy that competition can hardly be imitated.
Still, before reducing our prices to meet competition, it is preferable to use other practices or strategies, such as the search for differentiation, innovation, or improving customer service.
Differentiate from competitors
Another way to deal with competition through differentiation, i.e. by offering a product or service that has different characteristics that make other products or services from the competition.
But to compete not enough to offer something different, but must also be unique, novel, innovative, something that is difficult to copy by competitors, something that allows us to distinguish ourselves from it, and is the reason why consumers choose us to us before her.
For example, we differentiate ourselves in the design of our products, customer care, in providing extra services, the speed of our attention, to offer a personalized service, etc.
Constantly innovate
If we want to prevent competition we reach and maintain leadership, we must constantly innovate.
Innovate the competitive strategies means to launch new products, which do not necessarily have to be entirely new products, but can be based products we already have, but with new designs, new models, new brand, new logo, etc…
Or in any case can be based products we already have, but with new improvements, new features, new features, utilities, attributes, and benefits.
Likewise, innovation can also involve implementing new business practices, develop more efficient processes, develop technological improvements, implement new forms of distribution, etc.
Improve customer service
Something that is often neglected corporate customer service, as a way to differentiate ourselves from the competition, offering excellent customer service.
Provide good customer service means providing a friendly, having a friendly atmosphere, have a clean, provide prompt attention, provide a personalized service, etc.
Improving customer service may also involve, offer new customer services, for example, offer home delivery, to provide greater assistance in purchasing, greater assurance, service, installation, maintenance, etc.
Leverage competitive advantages
Another way of dealing with competition is to exploit our competitive advantages, i.e. possess those advantages to our competitors that allow us to highlight or excel at them.
For example, we may have competitive advantages in the design of our products in our brand, our customer service, cost, technology, logistics, infrastructure, location, etc…
For example, if one of our competitive advantages were the sale or distribution channels we have, we could exploit this advantage by using these channels to offer complementary products to those already available.