How often do you think about competing businesses and wish you could wrest some of their customers away? It’s easy to see other companies as adversaries, especially in a field such as building or marketing, where bidding is common. But that outlook can be shortsighted. You can actually help your bottom line by knowing, and even supporting, your competitors.
If you learn what your rivals are selling and interact with them, you can better understand the nuances of how their offerings differ from yours. With that information you can build a stronger bond with your customers and snag more repeat business and referrals.
How can that be? It’s simple. These days information is as valuable as products. If you know a lot about the companies in your field, prospects will see you as the expert and “go-to” person for your industry, not just a business trying to sell them something. Your reputation as a knowledgeable and fair vendor will keep people coming back and sending their friends to you.
Lara Apodaca, owner of Finely Lara’s gallery in Healdsburg, California, understands this more open-ended approach. She has noticed that shoppers have changed due to the latest economic hit. It has become more important for them to “feel a sense of belonging. They want to feel they are guests in your shop and that the person behind the counter knows and appreciates what their town offers,” she says.
As a result, Apodaca regularly does a “walkabout” to all the businesses in her vicinity, including rival galleries selling custom jewelry and fine art, to see what they are up to. When a client in her shop is looking for something specific that she can’t offer, she can point them to a shop that might be able to help. “My referrals to other businesses keep my customers coming back to my shop whenever they visit the area,” she says.
In a similar vein, the visitor’s bureau in the tourist town of Sonoma, California, has a program to educate storeowners about nearby shops and services, including their competitors. “We are seeking to reacquaint downtown businesses with info about what else is going on,” says Jennifer Yankovich, chief executive of the Sonoma Valley Chamber of Commerce. “Visitors really like it when the businesspeople know and support their neighbors.”
Startup businesses in the Internet world seem to have a strong grasp of this collaborative form of competition. Wil Reynolds, who founded search marketing firm Seer Interactive in 2002, says that Web entrepreneurs like him “actually congratulate our competitors from time to time.” Instead of bragging about how they are better than everyone else, savvy Web startups focus on how they bring value to clients and try to give a useful perspective about the industry, according to Reynolds and other online entrepreneurs.
Think about doing a “walkabout” in your industry regularly and sharing what you learn with your customers. Attend trade exhibits to see what similar businesses offer. Select the best mixers and receptions where you can get to know leaders in your field. Visit your rivals’ stores, showrooms, or Web sites to see what they provide to customers that would complement your offering.
Knowing your competition will keep you up on trends in your business, build relationships with other professionals, and, most importantly, allow you to help your own clients.