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Does Your Marketing Team Secretly Love the Competition?

May 19, 2011

Today’s piece has been written by Karen Euler, Marketing Manager at Carol R Johnson Associates Inc. and member of the Board of Directors of SMPS Boston.

Last week, at the SMPS Northeast Regional Conference in Newport, Rhode Island, I met the incoming president of a competitor firm.

I felt a little strange as I jovially shook his hand, cracked some jokes, and even helped him sort through some strategy he is working on around personnel. Afterwards, I thought to myself, “Wow, I sure do seem to love the competition. What’s wrong with this picture?” Nothing, it turns out.

Earlier in the week I had read a compelling blog post about competition by Fred Wilson, a well-known venture capitalist in the high tech industry. The phrase that stuck in my mind was, “the sales team dislikes competition but the marketing team appreciates it.”

Read on:

… I was having breakfast with the CEO of one of our portfolio companies recently. And we were talking about how the sales team dislikes competition but the marketing team appreciates it. That gets to the heart of the pros and cons of competition. When your company is competing for a piece of business and you have a tough competitor in the mix, you can often lose the business. The sales team, who is compensated directly on revenues, hates that. But when your competitor spends heavily on marketing its offerings and identifying the pain point both your company and their company solve, that is good for you. It generates additional demand, and some of that demand will come your way. The marketing team, which is always trying to do more with less, loves that.

There are a number of good things about competition. As described above, competitors will invest in marketing and the combined marketing efforts of a number of competitors will accelerate the development of a nascent market. It is very hard to build a market all alone. Also, when a large company enters a market, it validates the market in the minds of many who had not been paying attention to it before. That means customers and also eventual acquirers of your company. And there is nothing quite like a competitor to fire up a team. I’ve seen many companies start to coast a bit after they have successfully taken control of a market. Then a pesky new competitor enters, takes some business from them, and then all of a sudden the team is fired up again. All in all, I’d rather see our portfolio companies have competitors than be the only participant in the market.

But competition is challenging. First, when you have strong competitors, you will lose business to them, often frequently. That increases sales costs, time to close, and makes it harder to grow rapidly. Competitors will also spread fear and doubt (FUD) in the marketplace. This is particularly galling. I’ve heard all kinds of crazy nonsense spread by competitors to our portfolio companies. Some of that “crazy nonsense” stuck around for a long time and hurt our portfolio company in the market. Competitors can also strike business deals with powerful allies and gatekeepers who can make it hard and at time impossible to enter certain parts of the market. Competitors are a pain in the rear and make operating a business harder in many ways. (…) Source: A VC.

We all know that in the A/E/C industry, today’s competitor could be tomorrow’s teammate. Add to that the growing complexity of projects and the increase in number of stakeholders for so many projects, and clearly marketers and principals must find common ground with all sorts of people at all times. This is the power of SMPS: we marketers work together across firm lines, sharing our creative projects – whether panel discussions, multimedia presentations, brochures, or Facebook pages – elevating the discussion and gaining market share for our entire industry.

When we work to identify new markets in our industry, individual marketers so often build on the work of their competitors. Just last week, a principal at CRJA and I met with a representative of the US government, having heard from a competitor how useful his service had been to their building business in China and in other countries. We got approval from the management committee to begin hiring his group to set up meetings for us in Shanghai and Beijing right away. Now that we’re doing it, we can’t believe it took us so long to work with this group. I will be spending some time this week reviewing our promotional literature on our current China projects. And now, alongside the competitor who tipped us off to this strategy, we are pushing into new markets in China.

So, upon reflection, it is not such a bad thing that I fraternized with my friendly competitor last week in Newport. In fact, we marketers should embrace the competition from time to time!

One Comment leave one →
  1. @my88s permalink
    May 19, 2011 5:54 pm

    This is a “glass half full” kind of article…I LIKE it!

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