Are Competitors or Customers More Important?
There are three gas stations on the same side of the street, less than one mile from my apartment. When the price goes up at one, the others follow. When the price goes down, the others drops their gas prices. No matter the company or distributor, when the price changes at one place, they change at other stations for miles around. I understand the enormous complexities that go into the price of oil and how it changes by the minute. Still, after driving down the road for some time, I cannot help but notice a competition over mere pennies.
A conundrum exists in business, should the company’s focus be on the competitor or the customer? It’s a good question that many current and future business owners are pondering. At first glance, you may think that customers are more important. Cash is king, right? But what about keeping up with competitors? If your competitor down the street drops their price $0.04, but you were so worried about customers your price stayed the same, then you would have no customers because they would be chasing the lower cost. What then? We are back to the original question of Should You Obsess Over Competitors or Customers?
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What if I told you the only competitor you had was yourself? Don’t close this tab and go back to looking at memes. Keep reading. Your “competitors” are only competitors in your mind. I want you to change your thinking from competition to looking at your industry as a whole. There are two ways of building the tallest building: (1) build the tallest building in competition with others; or (2) knock down everyone else’s building. What is your mindset toward the others in your space? Are they a vehement enemy or could you collaborate? Would it be so bad if a few times a year you both offered specials for each other’s products? Try to build each other up, not knock them down.
You cannot convert the converted. Your competitors have spent a lot of time and money investing in their customers. You may be able to convert some of them, but there will always be those customers you cannot get into your store. Those people are not your concern and it’s not up to you to win them. It’s up to that company to keep them.
Here in Cincinnati, we are known for our chili-covered spaghetti. There are more than half a dozen places claiming to have the best chili in the city. However, there are two clear market leaders: Skyline and Gold Star. Gold Star is good, but I love Skyline. I don’t have anything against Gold Star, but I would pass five Gold Star restaurants to go a Skyline. There’s something about Skyline that I like better whether it’s the brand, the chili, or maybe the nostalgia as a kid going there with my family. Gold Star has no business trying to convert me because I am unconvertible. Short of Skyline closing their doors, I’ll continue to go.
Your focus should be getting new customers by launching ad campaigns on social media, creating awareness, and engaging with new people. Don’t worry if your competitor puts out a shiny new product or has a mouth-watering new dish. Hopefully, they are responding to a need voiced by their customers over two-way social media. Gather your customers and listen to them. You will have greater success catering to the needs of your current customers than trying to steal others from competitors. If you are truly better, then people will come to you. There will always be those you cannot collect. The market will decide.