Let's Talk About Competition

How to win every time

No matter who you are or what you are, you have competition. We compete for food, for water, for attention, for mates, for… well just about everything. Businesses are no different – we compete for employees, for customers, for supplies, for financing and so on.

Given that competition is as old as the planet, there are accepted ways of competing. This is caused by social pressure, physical limitations, belief systems etc. In sports we have prescribed rules (such as the offside rule in football / soccer).

In business we have rules too. But the strongest rules are those self-imposed rules, “That’s how it’s done”. Business tends to compete on aspects like pricing, features, quality – unfortunately none of these are sustainable. There will always be someone who will add a new feature, offer a price reduction or extend a warrantee.

However, the competitor that scares the heck out of all the others is the one that breaks the self-imposed rules and changes the business model.

Consider Blockbuster and Netflix. Netflix launched with no late fees and then offered streaming services. Blockbuster was stuck with millions of VHS tapes and 9,000 store leases – pretty hard to pivot with that load. Consider Tesla and, well, all the other car companies. Tesla sells direct to consumers which significantly reduces its costs. The incumbent’s 90,000 plus dealers in North America are not going away easily - leaving Tesla with a sustainable competitive advantage.

This story has two sides.

Defense – be vigilant for any signs of your industry’s business model being upended.
Offence – don’t play by the rules. Look for ways to change the model in ways your competitors can’t follow and then revel in an unfair advantage.

If you need some ideas on ways to change the game – let’s talk.

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Thank you.

Andrew