I have seen way too many small companies proceed cautiously; lose potential advantages because they worry about competitors learning about their plans. They withhold opportunities to share their new products with influential folks in the industry. They spend way too much time being stealth. They alter their plans because of perceived competitive moves. Unfortunately they worry about the wrong things and pay less attention to right things.
Where to watch competition carefully?
- Sales Positioning and Tactics – watch your competition very carefully – learn as much as you can about their tactics and vary your approaches. Whether you get into an opportunity and whether you are able to convince a prospect to become a customer will depend on perceptions and it is important that you pre-empt your competition. When it comes to positioning, philosophical differences, you should strive to have an advantage. I will illustrate with an example:
Let’s say you are selling an on-prem solution and competing against a SaaS vendor – SaaS vendor will try to position you as outdated and out of touch with reality. They may use specific talking points. If you learn what those talking points are, you can pre-empt them. You may also be able to structure the conversation differently. Instead of making the evaluation about deployment models, shift the discussion to focus on maturity of the solution, number of similar customers using the solution. Learning your competitor tactics will help you frame the evaluation context with your prospect. (Trust me, many deal RFPs are written by vendors).
- Market positioning – to investors, analysts and press
Very important to know what your competition is saying. It’s easy to learn, most analysts and press will tell you if you ask nicely and you are not considered a jerk. This is an area where relationships matter. Oh, and whatever you do, do not piss off press reporters – they are just doing a job – don’t fight them publicly or criticize them – it hurts you more. If you come back with a rational argument on why their article is wrong behind the scenes, most will correct it.
This is important because how market perceives you is critical to your future success – if they view you as a vendor on decline, you will be left out of many evaluations. You must proactively work to position your company and product in the most positive light – this task cannot be taken lightly – as the saying goes, in any social system, perception is the reality.
When not to alter your plans due to competition?
- Product Plans
Shielding product plans or altering them based on competition is plain stupid. Here is why. Even if your competitor learns about your product plans, trying to make a change in their plans will take herculean effort. And even if they successfully do that, they will end up working with incomplete information and as a result will build an inferior product.
Changing your product plans: you will have lot of heart burn convincing your dev team to change course midstream because a competitor is doing it. First of all, engineers are by nature suspicious of marketing driven features and when you describe what you think is competitor doing, you are doing it without understanding “the why” of the feature and engineers will detect your BS. Now, you will be negotiating for a bare minimum implementation of the feature because you want “some” competitive parity. This will hurt your product in the whole because a small crap feature can impact overall product design decisions and drag you down.
- Launch Plans
I will be honest here. You are an idiot if you pre-announce a product to pre-empt a competitor. First impressions of a product count. Do not ship a crappy first product under GA (Its fine to do an MVP for a small subset of users). Do not pre-announce a product – as the saying goes, you cannot build reputation on what you are going to do. No one cares, not even your mom. Are we clear?.
Even if you successfully pre-empt a competitor product by some unnatural gyrations done by your product team, your product will look inferior to your competitor product, which was built with a proper understanding of the “why” for the feature set. Your “why” is “pre-empt competition”.
This is not a comprehensive list, just few thoughts – agree/disagree? comment or tweet your thoughts.