What should you say when a potential customer asks you about your competitor’s product? What if their product is better than yours? What if you don’t know your competitor’s product?
If you are selling any product in any marketplace, these are all questions that you will come across at one stage or another. If you are doing your job as CEO of your startup business properly, you should know the answers to these questions and other similar questions without having to even think about it. If you feel like your knowledge about your competition perhaps isn’t quite up to scratch, or you’re looking for a few tips, then read on!
Intimate knowledge of your customers and the market you are trading in is imperative if you wish to create the best product and then dominate sales in that market. The earlier you know this information, the better. In fact, if you have a product almost ready to take to market, and you haven’t yet done a thorough competitive analysis, I’d say put whatever you are doing on hold, then don’t continue until you are satisfied that you are one of the most knowledgeable people around on the topic of your product, your competition and the market.
Your startup will be navigating uncharted territory. Everything should be done firstly with careful consideration of the customer, and then with respect to what existing and potential competition are doing or might do.
1. Put yourself in your customer’s shoes.
Ask questions like why are they buying the product? What problem do they have that it is solving? How does the product solve the problem? What alternative options do you have as a customer? What would make you consider or dismiss alternatives? How easy is it to obtain the product? How price-sensitive is the market?
2. Put yourself in your competition’s shoes
Ask questions like how are you currently meeting the market’s demand? What development might you have in the pipeline? Are customers happy with your product? Are there known problems with the product? How difficult would it be for your customers to move to a different product? What would you do if someone else were to enter the market? Are there potential newcomers on the horizon?
3. Put your own shoes back on
With this new-found knowledge about the market and your competition, what can you do to stay several steps ahead of the competition and market trends? If you know what is currently available in the market and how it is failing to meet all customers’ expectations, you can design a better product and then market it as such. Knowing the barriers your competition creates to keep customers from moving away from their product, can you design a cunning scheme to entice customers over to your product? Plan what your actions will be when competition pull one or more tactics to try and keep their market share – they may reduce price and will certainly make claims that may or may not be true about your product and theirs.
All of your plans including development, marketing, advertising, shipping, customer support, any other interaction you have with your customer should be created with knowledge of what your competitors are doing, and how you might be able to do better.
After you’ve thought about all of these things and done your research, the question “What if you don’t know your competitor’s product?” is no longer a problem – you’ll know their products intimately.
“What if their product is better than yours” – in some respects it may be, but that depends on your definition of ‘better’ and who it applies to. By knowing their product and where it fits in the market, some of the things that may on the surface seem ‘better’ (such as a larger engine in a car) may translate to downfalls for different segments of the market (such as town commuters who are looking for efficiency over power). For everything else, you have had the chance to design your product to be superior.
“What should you say when a potential customer asks you about your competitor’s product?” Personally, I have no problem at all describing all of the pros and cons of our product against our competition because I am confident that I have the knowledge to come across as trustworthy as I describe my product stacked against the competition’s product in detail. Because I’ve done the work at the outset and understood my customer, the competition and the marketplace, and designed my product to be the best, I just tell my audience the truth and let them make their own decision.
Stu Bradbury is the Business Strategy Advisor for the Sprout agritech accelerator programme in Palmerston North. He is a Director of AgriOptics and is the founder of Where's My Cows which has been acquired by Lindsay Corporation out of the USA.