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Last updated: July 2018
(This is one of a series of articles, the first of which is here.)
Some of your visitors end up buying from your competitors. If you don’t have a strategy for winning in spite of competitors, you are doomed.
This article describes many powerful concepts and techniques we have used to help our clients dominate in some of the world’s most competitive markets.
No company exists in a vacuum. Sometimes, visitors abandon your website simply because they prefer your competitor’s website.
How can you win the sale?
You could attempt to become better than all of your competitors in every way—but it’s hard being all things to all people. It’s much more effective to niche—to focus your efforts on being the best in a small number of dimensions.
You can be the best by providing a subset of features that some people would love:
Often, you can niche by targeting a particular group of customers. For example,
When you niche your service to a particular group of needs or customers, you get several powerful advantages. To illustrate the point, consider shampoo. If you study the shelves of a supermarket, you’ll see shampoo for the following:
In fact, you’d struggle to find general-purpose shampoo that isn’t niched to a particular type of hair.
Niched shampoos have displaced all the non-niched ones, because they have been more successful with customers.
Niching is effective for several reasons:
“Every time [that poster] goes viral we definitely gain legitimate fans that listen to the music, attend shows, buy merch, and properly get what we’re about, which is awesome. I’m pretty sure 90% of the people that follow those pages have never even heard of Devourment but now they’ve heard of us, which I can’t really complain about.” —Mike, Party Cannon
Niching works best in marketplaces that are noisy and overcrowded. By being distinctive, you win a disproportionate amount of attention.
Once you have grown to saturate your niche, though, you need to satisfy more people and needs. And that point, the winning strategy is to become less niched and more moderate.
You see this happen during TV talent shows and political campaigns. At the start of a political campaign, a candidate benefits from being extreme. As the campaign progresses, and competitors are eliminated, the wise candidate mellows, sacrificing attention-getting antics in order to appeal to a broader audience.
The software company HubSpot refuses to offer consulting services. Instead, it operates a partner program for agencies. As a result, many consultancies around the world evangelize Hubspot. If Hubspot had chosen to offer consultancy services, those same companies would have actively avoided recommending Hubspot.
By being niched and focused, your company can be symbiotic with other businesses. Neighboring companies become allies.
By being unfocused and broad, your company treads on more toes. Those allies become competitors.
Exercise restraint when widening the scope of your services. Try to minimize your number of competitors. Keep your footprint small.
When we started working with Mobal, it rented phones to international travelers. So did its competitors. We created a new value proposition for Mobal: a travel-phone you could own for just $49, with no monthly fees.
Suddenly, Mobal was no longer one of many phone-rental companies; it was the $49-travel-phone company. Reviews in travel magazines would say, “If you need a phone when you’re abroad, you have two options: (i) rent one or (ii) buy a Mobal phone.”
By creating a new category, Mobal became 50% of the available options. And gained free coverage in TIME, Inc, Wall Street Journal, The Washington Post, and almost every travel magazine.
One of the most common mistakes is simply to identify an opportunity, and then aim to capture it. Just because something is an opportunity today doesn’t mean it’s worth chasing.
Instead, look for opportunities that you can seize without a struggle, because your competitors won’t stop you.
List your opportunities, and then run them through the following checklist, to identify which of them your competitors are likely to avoid:
If niching is so effective, why do so few companies do it? Because niching means overcoming three types of psychological discomfort:
Many people agree that they need to focus more. But they think that focus means concentrate. It doesn’t. Focus means neglect. As Steve Jobs said, “Focus means saying no to the hundred other good ideas.” Focusing doesn’t feel empowering; it feels embarrassing, upsetting and scary. A sign that you are focusing is that you frequently cringe at the things you aren’t doing. Your head knows you are doing the right thing, but your stomach turns at the things you are neglecting.
How can you overcome the cringing feeling? Remind yourself that your neglect can be temporary. Once you dominate a particular niche, you can incrementally expand the scope of your business. As Amazon has done. Amazon started by being a bookstore and is heading towards being an everything store.
If you see people running out of a building, you would be wise to copy them; maybe the building is on fire. People trust social proof because it’s often a reliable indicator. However, it can work against you. Next time your market research reveals an opportunity, and you wonder why no one else has tried it, be aware that your desire for social proof might be the only thing standing between you and success.
We tend to behave like those around us, to be liked or accepted. This same instinct can cause marketers to feel a twinge of discomfort every time they stray from the norm. But niching means doing things that others don’t. So next time you feel a twinge of awkwardness because your company is doing something eccentric—because you are sticking your neck out—remind yourself that your desire for conformity might be holding you back.
The best way to “beat your competitors” is often to redefine yourself so that you have fewer of them.
Be prepared to go to war, but choose your battles wisely.
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Fax: 0870 838 1135
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