The Art of Driving Your Competition Crazy

“The purpose of competition is not to beat someone down, but to bring out the best in every player.” Walter Wheeler

One of the signs of boom--or at least a boomlet--is that companies start wanting to drive their competition crazy. This occurs when “survival” is no longer an issue and optimization or maximization can become a corporate goal. However, the desire to do things to the competition can lead a company astray--or drive it to even greater heights.

Companies go astray when defeating the competition becomes more important than taking care of customers. When companies become obsessed with the pursuit of excellence, by contrast, they often reach new levels of greatness. Here's how to avoid the former and achieve the latter.

1. Know thyself. Before you can drive your competition crazy, you have to understand what your company stands for. Otherwise, you'll only succeed in driving yourself crazy. For example, Apple stands for cool technology. It will never represent a CIO's safe bet, an “enterprise software company,” or service and support. If it decided it wanted to drive Microsoft crazy by sucking up to CIOs, it would drive itself crazy--that is, if it didn't perish trying.

2. Know thy customer. The second step is to truly understand what your customer wants from you--and, for that matter, what it doesn't want from you. One thing that your customer seldom wants to do is to help you drive your competition crazy. That's in your head, not your customer's. One more thing: a good company listens to what a customer says it wants. A great company anticipates what a customer needs--even before she knows she wants it.

3. Know thy enemy. The third step is to truly understand your competition. You cannot drive your competition crazy unless you understand their strengths and weaknesses. You should become your competition's customer by buying their products and services. I never truly understood what it was like to be a customer of Microsoft until I bought a Sony Vaio and used Windows. Sure, I had read many comparisons and competitive analyses, but they were nothing compared to hands-on usage.

4. Focus on the customer. Here's what most people find surprising: the best way to drive your competition crazy is not to do anything to it. Rather, the best way is for you to succeed because your success, more than any action, will drive your competition crazy. And the way you become successful is not by figuring out what you can do to the competition but for the customer.

You succeed at doing things for the customer by using the knowledge that you've gained in the first three steps: understanding what you do, what your customer wants and needs, and what your competition doesn't do. At the intersection of these three factors lies the holy grail of driving your competition crazy. For most companies, the key to driving the competition crazy is out-innovating, out-servicing, or out-pricing it.

5. Turn customers into evangelists. There are few things that drive a competitor more crazy than an unpaid, thunderlizard group of customers who become evangelists for a company. I covered this topic in detail in The Art of Evangelism, but the gist is this: create a great product or service, put it out there (“let a hundred flowers blossom”), see who falls in love with it, open up your arms to them (they will come running to you), and then take care of them. It's that simple.

6. Make good by doing good. Doing good has its own, very sufficient rewards, but sometimes you can make good and do good at the same time. For example, if you own a chain of hardware stores, you can help rebuild a community after a natural disaster. You're bound to get a lot of publicity and create bonds with the community--this will drive your competition crazy. And you'll be doing something good!

7. Turn the competition into allies. One way to get rid of your competition is to drive it out of business. I suppose this might be attractive to you, but a better way is to turn your competition into allies. My favorite author of children's books is Tomie DePaola. My favorite DePaola book is The Knight and the Dragon. This is the story of a knight and a dragon who train to slay each other. They are smashingly unsuccessful at doing battle and eventually decide to go into business together. Using the dragon's firebreathing ability and the knight's salesmanship, they create the K & D Bar-B-Q. For example, if a Home Depot opens up next to your hardware store, let it sell the gas barbecues, and you refill people's propane tanks.

8. Play with their minds. If you're doing all this positive, good stuff, then it's okay to have some fun with your competition--that is, to intentionally play with their minds. Here are some examples to inspire you:

• During the Korean War, the U. S. Army Office of Strategic Services left a supply of condoms for the Communist Chinese to find. The condoms were specially manufactured in an extra-large size. The label on the boxes, however, said, “Made in the USA Size Medium.”
• Hannibal once had his soldiers tie bundles of brush to the horns of cattle. At night, his soldiers lit the brushwood on fire, and Hannibal's Roman enemies thought that thousands of soldiers were marching towards them.
• A pizza company that was entering the Denver market for the first time ran a promotion offering two pizzas for the price of one if customers brought in the torn-out yellow pages ad of its competition.
• A national hardware store chain opened up right next to a longtime community hardware store. After a period of depression and panic, the store owner came up with a very clever ploy. He put up a sign on the front of his store that said, “Main Entrance.”

If you like this topic, let me know, and I'll try to write a posting about how to avoid being driven crazy.

Technorati Tags: competition, entrepreneurship

Comments

[pinano]

Good stuff. I would like to hear how to avoid being driven crazy.

[caveatBettor]

I've been following Guy since my days as a Cornell freshman (Class of '84), among the first to use the Mac, and on top of that, among the users to deliver solutions using Acius' 4th Dimension, first at Cornell and later at JPMorgan. After 2 decades of good times rolling, these posts and this blog are a wonderful reconnection to the wealth of Guy's experience, wisdom, and humor. Just wanted to say thanks!

[Mike]

Guy, post away!

I am always fascinated by companies that are competition driven... I think it Jeff Bezos who said "you can either be a competition-focused company, or a customer-focused company." For my money, it's a lot more fun to be a customer-focused company.

[Erik]

Great article. I would like to emphasize the art of the knowing the customer. Too many people focus too much on their competition and not enough on the people who are buying their goods.

Out doing your comp is one thing but neither of you will get anywhere if you tailor your product or service to beating the other guy and forget about the little people.

[Kim The Admin]

Loving it.
I especially like the real life creative examples.
Definitely original thinking.

[Stephan H. Wissel]

Great post, more of it! I definitly looking forward to "How to keep sane when the competition wants to drive you crazy"
:-) stw

[ParadiseFound]

Guy

Great post with some fantastic insights. And the examples you cite are inspirational and innovative. I'm definitely a fan of this topic - please write more.

[Reinis Ikass]

Hello, Guy!

First of all - many thanks for sharing your knowledge and experience!
I relly enjoyed reading your book The Art Of The Start.

I would love to read about how no to be driven crazy by competition.

Keep up the great work! :)

Best regards,
Reinis Ikass

[santi]

This really good, But why dont post more articles on personal selling.

[Mike S]

I really like the evangelistic part of your work. Its a little different than the viral marketing, because of the intensity involved, but similar.

Many of the topics you blog about are common sense, but its so great to see them in such digestable form. Real business basics, and thats what VC people look to find.

If you can answer one of the implied questions above in the positive for a big market, you have a product. If you can answer three, you have a business. If you can do all, you're huge.

[John]

An article about not being driven crazy by these same tactics ;-) would be really great.

[Doug Hanna]

I like the hardware store example. That's a good one. The pizza one is good, but not quite as funny.

[Gordon in Taiwan]

More! More! I particularly like these little stories from different industries.

[Michael Willingham]

Great post, Guy. I would enjoy reading a post on how to avoid being driven crazy.