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Differentiate, Don't Replicate

All too often business owners and business people alike spend too much of our limited mental capacity focusing on the competition.

Though true that understanding our competition is critical in reaching the next precipice in a business, substantial drawbacks remain with putting more effort than we should towards our competition.

  1. Your competition probably isn't thinking about you - Our egos would like to tell us otherwise. We must assume that our competition is not thinking about us, but rather thinking of ways to improve their business. So while we waste our time focusing on what they're doing currently, we must also assume their business is evolving, thus we will always be behind what they're doing.

  2. Your current customers may not receive as much attention as they should - On a recent tour of Raleigh Brewing Company, I spoke with Patrik Nystedt, co-owner and COO of the company. Patrik noted, “once you lose a customer, you will never get them back.” As we know, the acquisition cost of a customer, either by time or money, is substantial. We could be instead focusing on retaining our current customer base and receiving constructive feedback on what they need to remain happy.

  3. You may forego leveraging your differentiating factors - Sure, the reasons people choose to do business with us over our competition could be out necessity, but let's think more positively here. In many cases, people choose to do business with a person because of what that person brings to the table that a competitor does not offer, i.e. something as simple as a higher level of customer service. Because your competition doesn't write hand written thank you notes doesn't mean you shouldn't. We make money and build market share off our differentiating factors.

  4. Individualism may be stifled - If we feel we should act or dress a certain way to fit in to what is "normal", we are not allowing ourselves to take form as who we really are inside. We are most effective when we feel as though we can be our unabashed selves. Ignoring our personality and individualism removes the "you" from the equation, which is the main reason people have chosen to do business with us in the first place. If anyone has an issue with your individualism, why would you want to do business with that person in the first place?

  5. The power of the referral is lost - I hope that people I do business with feel confident enough in my abilities and behaviors that they refer their colleagues to me in times of need. If I act just as my competition acts, and offer a service equal or similar to my competition, how am I able to stand out? My clients may instead refer their colleague to the last person they spoke to rather than have me at the top of their mind, as I am now no different than the next guy.

  6. Gaining market share is more difficult - If we offer the same product or service as our competition, how in the world can we expect anyone to switch from a competitor? We are boxing ourselves in to acquiring new business only when a competitor has made a client unhappy, rather than acquiring new business even when the client was somewhat happy, but met us and thought to themselves, "yes, this is who I would prefer to do business with."

While understanding your competition is important, we must ensure we are using this understanding to continue to push the peddle on how we can better differentiate ourselves rather than replicate what is already being done, especially in a saturated market.


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