When it comes to responding to a formidable competitive threat from another provider, passive activity in the shadows can do more damage than a full-frontal assault.

In fact, to efficiently surpass or thwart a better-performing competitor, competitive intelligence and repositioning can combine to defend and set the stage to advance.

Put another way: spy to understand the opposition . . .  and know how to respond. Guessing is not reliable, and if the guess produces, it may have produced for reasons other than anticipated. This complicates extending a good result

Keep your enemies close …from afar

Use available intelligence (publicly and commercially) on competition, learning their features, characteristics and habits. Multiple sources abound that can give you a glimpse into the opponent’s:

  • seasonality of sales and supporting systems
  • suppliers, perhaps including vendor personnel that work directly with the competitor
  • marketing schedule, budget and patterns over time
  • new product/service launch
  • user reviews and comments
  • staff, including key line staff and leadership (in some cases, you may be poised to recruit top performers away from the competition), as well as asking:
    • Are staff unionized or otherwise organized?
    • What is the turnover rate?
    • Where do they gather for lunch or socially?
  • industry regulations and potential lapses in competitor’s adherence (when applicable)
  • financial data, including debt and repayment structure

Look for patterns that will help your team exploit  weaknesses or avoid unwinnable fights. That’s exactly what we did to achieve victories over stronger competitors on two occasions in particular.

First a retreat, then a blitz

A retail-oriented competitor launched a new product going into test markets to directly compete with a similar product we successfully launched years prior.

Crucial to its core business, as well as to introduce its new product, the competitor was dependent on third-parties for supply and delivery to consumers.

A Potential weakness . . .

We learned the competitor’s test-marketing and test-launch schedule and the role of “crucial third parties” and recognized that misdirection was the way to win.

We  pulled back advertising for our nationally distributed product in the competitor’s test markets. This created the illusion that our competitor had a winner.  As predicted, the competitor and its third party partners began their national roll-out with inflated confidence. The celebration was short-lived.

Following our retreat, we deployed a blitz of our best marketing in the competitor’s test and rollout markets.

This not only crushed sales they anticipated, it undermined trust between our competitor and the  third parties they depended on for their entire business, not just the new product. After all, a big success was demonstrated in test markets – or so it seemed. The competitor pulled the product and spent years rebuilding trust with partners key to their business.

It all began by studying the competitor’s operation, approach to bring the product to market, and finding where their operation was most vulnerable.

Repositioning: Assault  . . . using the competitor’s arsenal  

In another victory, we won (and kept) market share over a competitor whose price was 30 percent lower than our client’s.

On its own, this victory was particularly sweet because the difference between both products was negligible, in fact a commodity.

In commodity sectors, it is not uncommon to find management assuming that all customers are looking for the same thing – say, salt. With this basic tenet in mind, once again the first step was to study the competition – – AKA competitive intelligence. Our investigation confirmed that customer expectations were in fact the same regardless of the provider.

With no recognizable product differences versus the competitor, we settled on creating the perception of one by carefully “describing” the competitor and the way they conducted business.

Our strategy exploited the competitor’s SOP and leveraged many of their features and characteristics, including regulatory compliance, debt structure, political alliances, legal resource and tendencies, customer service, and marketing.  It turned out some of their core operating methods were inconsistent with consumers’ expectations. The key to this advantage was discovering core operating characteristics the competitor could not easily change. So, we merely needed to point out the disconnect.

Our response was to REPOSITION these core features of the competitor’s business operation to highlight their unreliability.   Of course we never mentioned them by name. No use promoting their name on our budget.

Without expending any additional client marketing dollars, we were able to create the perception that the opponent was inferior and undesirable – again, with a product bundle whose differences were negligible.

As a result, the competitor’s customers defected in droves to our client’s product as the competitor descended into chaos, forcing them to pull back on expansion plans and cease its pursuit of our client’s customers. That client now still enjoys a disproportionate market share over the competitor.

When you know or suspect that you have  a deficit compared to a competitor – be it in the form of marketing spend, depth and breadth of talent, longevity and name recognition, image or size to name a  few– stay in the shadows a while and study  the competing operation.  Once you’ve identified the opponent’s bench strength, use the intelligence gathered to dissect structures, relationships and dependencies of the competitor that allow  you to advance on an opening left uncovered.  This is tough work, but the return is often dramatic.

Spying and deception – by fully legitimate means – can create just the opening needed to gain sustainable competitive advantage. If you don’t do it, you can be sure your competition will.