Every business owner knows who their competitors are. Even if you’re not watching them yourself, others won’t hesitate to point out to you what competitors are doing, asking if you have considered doing the same, or pointing to their perceived success and asking if it worries you.
As a business owner, it’s easy to over focus on your competitors, to build them up into the personification of all your business troubles.
It’s easy to forget that they are not the enemy.
Competitors are your proof of market. If there’s enough interest for your competitors business to grow, then there’s enough for yours to grow too. No product is alone in its market. Coca Cola has Pepsi, Apple has Microsoft, Nike has Adidas and Google has Bing.
Brands are living in hyper competitive times.
This is the age of the comparison shopper. But comparison doesn’t have to be a bad thing.
Every time a brand elevates your customer experience, solves a problem for you, or introduces a new feature, they heighten your awareness of the relevance of their product. This heightened awareness often leads you to look at their competitors.
This is good news for brands with something interesting and unique to offer. A strong offering has have nothing to fear from competition. No brand can be all things to all people, and it’s natural that some may decide they prefer another brand to yours, but when it’s just a case of preference, your competitors will be losing customers to you in exactly the same way as you will lose some to them. Heightening customer awareness only grows the market size.
The more your competitors can open the market up, the more people you have to sell to.
So if the people selling in competition with you are not your enemy, who (or what) is?
Bad Products Are The Enemy
You can have the best market position, the most customers, the best e-commerce site design and fantastic distribution – but if your product is no good, it will amount to nothing. Even Google couldn’t make Google Glass work, and the more recent scrapping of Amazon’s Dash Buttons proves again that no business is big enough to make a bad product fly.
Getting your product right is step one.
If your product is bad, sales will feel like herding kittens – lots of work and little reward. Make things easy and be sure to get your product right.
Bad Design Is the Enemy
As an e-commerce design agency, it’s no real surprise that the fundamental focus of our business is design. For us, design is both the method of our own customer acquisition, and the product we sell.
The reason we have focused on e-commerce design from day one is that in e-commerce, your brand will determine the worth of your product.
Just look at this necklace that is selling on Amazon for $24.99
Compare it with this one that sells for $13o.
These two necklaces are very similar, yet one sells for 4 times more than the other. That’s the power of branding.
Product design, Logo design, brand aesthetic, store design, the design of emails, Instagram posts and everything in between. Design is everything.
For you as an e-commerce merchant, you rely on design to entice and guide your customers and you shouldn’t under value that.
Bad Cash flow Is The Enemy
You now have great product, strong brand design, and a professional site to sell from. Growing sales should be plain sailing from here.
If you are at this point and sales aren’t picking up, something is wrong.
It could be something as simple as an error in your mobile navigation or your Facebook ads going to a dead page, but whatever it is, you need to figure it out fast. Trace your customer steps from all major traffic sources, from search to checkout. Can’t find the problem yourself? Get an expert to review your site. Frooition will review your site without charge, or you could pay a freelancer, but either way, this work must be done. You can’t afford to be blind to a problem that’s killing your cash flow.
At the most basic level, a business is a machine for making money. Without money, you aren’t really a business.
Small Margins Are The Enemy
You think your competitors are killing it – you feel like they’re everywhere. You guess they’re doing huge turnover every month.
But the truth is that you don’t know their business. You don’t know what their costs or margins are. There are so many variables in this equation.
What you do know is your own costs and margins. Focus on that. Jeff Bezos is famous for trying to squeeze margin out of his suppliers and partners so he can pass the savings onto his customers – creating customer satisfaction and growth.
You can do the same. And you don’t necessarily need to pass the discounts on to your customers. There’s great security and freedom that comes from operating with bigger margins.
If you’ve been buying from a packaging supplier for years with no discount for loyalty, email them and ask for one. Increased your stock orders but had no discount on unit price? Email and ask for one. Even if you’ve had discount, email and ask if you could get more.
Don’t focus on what your competitors might be doing. Focus on improving your margins.
Customer Churn Is The Enemy
It is easier (and cheaper) to sell to an existing customer than it is to sell to someone new. A lot of emphasis is put on customer acquisition, but customer retention is just as important if you want to build a business that grows and lasts.
Losing customers can destroy your business. But it’s not always obvious that you’re losing them, so pay attention and be sure to show customers that you appreciate them.
Distractions Are The Enemy
It’s easy to jump onto social media and search for your competitors. It’s easy to feel like they’re outpacing you in the real world when you see their impressive social stats – but it’s important to remember that brands on social media only show the world what they want the world to see.
No business is going to post their terrible third quarter sales figures to their Twitter account or Facebook page. They’re going to talk about their new products, their blog features and other vanity metrics. This is especially true when they want to make themselves feel better about their poor sales.
Keep focused on your strategy, stay firmly in your own lane and keep building your business. Ignore the distractions.
Weak Strategy Is The Enemy
Blindly building things can sometimes lead to magic. But as business plans go, ‘build it and they will come’ is more gambling than strategy.
Gary Vaynerchuk says that building a successful businesses is just a series of good decisions. The first time I heard that, I was shocked by the simplification, but it’s true.
Strategy gives you a frame from which to make good decisions.
Put time and thought into crafting a carefully considered strategy. If it’s good, it will change and grow with your business. There will be times when you need to switch things up and react fast, but you should always be strategic. When making decisions, hold your determination, keep your focus broad, and always remember the problem you are solving for customers.
Putting too much focus on your competitors will make you lose sight of your brand strategy. If this is happening to you it may be because you are not fully invested in your strategy, or you are making impulsive decisions. Ignore your competitors for a few months while you refocus your own strategy.
Poor Execution Is The Enemy
You have your brand aesthetic, your product and your strategy pinned down and you’re ready to go. But if you can’t manage the execution perfectly then the chances are, you’re going to struggle whether you have competitors or not.
Getting distracted and focusing too intensely on what everyone else is doing is only going to lead to poor execution of what you’re doing.
Prioritise quality of execution above everything.
Bad Customer Service Is The Enemy
Customer service is a huge differentiator in e-commerce.
Customer service has become so important because there are so many options available to consumers. They don’t need to suffer poor service. Consumers can buy product from quite literally anywhere in the world. No matter where you are, or what you sell, you’re competing on a global scale. Your competitor is not a similar business that is geographically close to you. Your competitor is the seller doing best in your industry.
You may not be able to afford to place as many adverts as they do, or offer the same fancy unboxing experience, but good customer service doesn’t cost any more than bad customer service. So customer service is an area you can win.
Keep focused on creating great relationships with your customers.
Ignorance is the enemy
Don’t be ignorant about your industry, competitors, trends and insights. Take time to read about how the greats think, work and plan. Stay on top of trends. This means both the area you are selling in, and e-commerce in general.
Believe in your brand
If you have a decent grasp on some of the things above, then you can forget about your competitors. Very few people can get all of these things right all of the time, but if you can get a good hold on even a few of these things, you will succeed regardless of what competitors do.
Choice for customers is only increasing. Double down on what makes your brand unique and let customers know about it so they can choose whether to buy from you, or another seller. You need to facilitate this choice. Let customers who love your brand be loyal to you, and let those who don’t want what you offer go to competitors.
It’s not you or them. The market is always large enough for many players to stake a decent claim and build a valuable business.