Competition You Can't Ignore

Editor's Note:  The following is a guest Marketing Mulligans post by Rajesh Setty, an entrepreneur, author, and speaker based in Silicon Valley, and a creator and seller of limited-edition prints at Sparktastic. This piece, which discusses the importance of identifying and monitoring indirect competitors, originally appeared in Amex OPEN Forum. Why is this critical? Because most companies only pay attention to direct competitors...the ones who pose the most obvious threats. However, competition can come from a variety of sources, and it's important to know exactly what those sources are so you can devise an appropriate marketing strategy that deals with them appropriately. You can follow Setty on Twitter at @rajsetty.

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First, there is no product or service that doesn't have competition. And if you tell someone that your product has no competition, what they hear is that there isn't a big market for your product...which isn't good.

Having clarified that, let’s look at the two big categories of competition.

On one hand, you have direct competition for your business — this is mainly other companies that are making the same promises that you are making. Lot of factors about the competitor (such as size of the company, pricing of their offerings, brand and image, etc.) will influence how much they will affect your business.

On the other hand, you have indirect competition. As the name indicates, this kind of competition is easy to miss.

Here are five of them to consider:

1. There is no “real” need now.

This is a mindshare competition. This happens when you create products that are “solutions waiting for problems.” There is a big “lean startup” movement going on (at least in Silicon Valley) where products are co-developed with customers. Most often, that’s not the case—someone develops a product because they see a need for it and assume everyone has that same need. If you have a solution that is looking for a problem, you need to go back to the drawing board.

2. There are mediocre, but less expensive, alternatives.

Whether you like it or not, if there are less expensive alternatives to what you are offering, there will be a large majority of people who will opt for it. Quality and standards are relative and varies based on taste. What one thinks as mediocre may be perfectly acceptable to someone else.

3. There are “minimal” alternatives.

Your gizmo may do everything from video chat to bringing your newspaper in the morning. You may also be adding new features every other month. The point is that not everybody wants all your features. 37Signals built a huge business building products with no-frills. Eighty percent of the people out there can get by using a product with minimal features and 80 percent is a large enough market to focus on.

4. People generally maintain “status quo.”

This is the hardest one to recognize and digest. Before your product or service came into the market, life was going on and life can go on without people having to use your product. In general, status quo will be maintained only because the alternate option is “to change,” which is not easy to come by.

As you design products, think of incentives that you can provide for people to embrace your product. It is harder than you think.

5. New ways of serving “needs” emerge.

You may remember products like Sony Walkman, floppy disks and VHS tapes. During their times, those products were popular and served the needs of people. Things changed and new products that changed the game emerged. With these new products, the way the needs were served changed—be it more capacity, more convenience, speed or new capabilities. Once that happened, the old products became obsolete and entered the end of their product life cycles.

© 2011 American Express Company. All Rights Reserved.

How To Make Your PR And Marketing Believable

Editor's Note:  The following is a guest Marketing Mulligans post by Erica Swallow, an associate editor of partner content at Mashable, where this piece initially appeared. All marketing and communications relies on credibility, or in this case, being believable, to be truly effective. Read on for a more detailed look at this important issue.

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Public relations and marketing professionals have dug themselves into a hole. With the overwhelming amount of PR spin and marketing messages flying at consumers on a daily basis, individuals are constantly on guard, trying to spot the underlying motives behind each claim, motto, message or deal that brands introduce. Many times the assumption by consumers is that marketing messages are motivated by greedy or deceptive intentions. This phenomena is what Ogilvy’s senior vice president of global strategy and marketing, Rohit Bhargava, recently called a “believability crisis” during his presentation at Mashable Connect 2011.

“Affinity has become the new secret weapon — we believe in people and companies that we like,” said Bhargava. For those in the public relations and marketing industries, it is important to gain back the trust they’ve lost from consumers by understanding what makes people, ideas and organizations more believable.

Bhargava spoke about what he calls Likeonomics, which “explains the new affinity economy where the most likeable people, ideas and organizations are the ones we believe in, buy from and get inspired by.”

What makes a person or organization believable, then? Bhargava said that Likeonomics is based on being simple, human, brutally honest and emotional.

1. Simple

To be more believable, the first step is simple and based on personal relationships, said Bhargava. “Be genuine, be honest, be open.” He believes that this concept has powered the social media revolution and the brands that have embraced it.

Bhargava pointed to Ally Bank as an example of a brand that gets it. Using the slogan “Straightforward,” the bank sheds light on deceptive industry practices and aims for complete transparency on rates and terms. Says one Ally ad, “we make money with you, not off you.”

2. Human

If you’re trying to build relationships, it’s a good idea to be human. Simply said, but not easily done.

Bhargava pointed to Innocent, a UK beverage brand that puts a lot of initiative into showcasing the humanity behind its brand. Each winter, Innocent runs the Big Knit, in which Innocent fans knit and send in hats to place on top of its smoothie bottles that are placed in stores. For each hat knitted, the company pledges 25p to Age UK to help make winter warmer for older people across the UK.

This initiative not only illustrates that the company’s founders care about those around them, but it is also a genius marketing idea. Walk into any grocery store and take a look at the beverage aisle (or almost any aisle). Row after row, you’ll see similarly shaped and colored packages. Now place smoothie bottles with cute knitted hats into the picture — get the point?

3. Brutally Honest

After ranking last in a consumer preferences survey of national chains in 2009, Domino’s Pizza launched its humility-filled Domino’s Pizza Turnaround campaign, which featured consumers hating on the product. Consumers complained that Domino’s Pizza crust tasted like cardboard and its sauce tasted like ketchup, among other pitfalls. Domino’s listened and its chefs got to work, reinventing a “new pizza.”

Relationships of any type are based on trust — trust isn’t possible without honesty. Bhargava said that brands must practice “brutal honesty and extreme transparency” in order to “get people over that hump of ‘I don’t believe you. I don’t trust that what you’re doing is anything more than spin.’”

Bhargava noted that “disclosure is not the same thing as honesty.” Outing the naughty deeds that your company participates in on your annual report isn’t enough.

4. Emotional

Founded by eccentric millionaire Christian Ringnes, The Mini Bottle Gallery is billed as “the world’s first miniature bottle museum.” Having recently visited the museum in Oslo, Norway, Bhargava told the story of its founding and why its so unique.

Ringnes “treats the museum with a great sense of humor, because he realizes that he has built an entire museum around something that most people who might think of visiting consider silly or at least strange,” said Bhargava. As a result, he doesn’t take himself too seriously when he markets and promotes the gallery. “The museum itself features a built in slide, a monthly award for the “tackiest miniature bottle” and even a fake brothel with a collection of 40 custom bottles from the 40 legal brothels in Las Vegas,” explained Bhargava on his blog.

Because collecting the mini bottles is his personal passion, it’s Ringnes’ goal to get potential visitors emotionally invested in it, too.

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How To Restore Confidence In Your Customers When You’ve Failed

Editor's Note: The following is another guest Marketing Mulligans post written by Mickie Kennedy, founder and president of eReleases, a cost-effective electronic press release distribution service, and a widely-regarded and well-respected PR professional who maintains the company's popular PR Fuel blog. How do you recover when you've made a mistake of some sort that has obviously angered your customers? It's a very important question that few businesses know how to address effectively. Find out here.

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But is there any coming back from a huge faux pas like the one you’ve committed? Your customers are likely cursing your name and are unlikely to forgive you anytime soon. How do you go about restoring confidence in your company and brand?Well, you goofed. Big time. The Twitterverse is ablaze with anger, your Facebook feed is filled with seething rage, and the national news has even given the story airtime. Your face is red and soon your profit margins will be, too! Unless you do something.

Time

For one, it’s best to remember that “anytime soon” mentioned above. Just because they may not be willing to give you a second (or third) chance right now, this may change in the future. So don’t lose your mind trying to bring them back over as soon as possible.

Right now, what you should be focusing on is getting your name back into good standing. This involves buckling down and getting to work figuring out ways to build goodwill. One way to get about this is to take into consideration what went wrong in the first place.

Was your big mistake lying to your customers? Then you need to find ways to show the world that you’re actually honest. Make sure to take the full blame for the lie first of all then go about orchestrating a campaign around “keeping promises.”

Did your product cause harm to some of your customers? Go out of your way to fix the situation, and then find some nonprofits to align yourself with to show you’re concerned with human interests.

Next Steps

When you feel the world has calmed down enough about your big goof (and it may not take long…the world moves fast these days), it’s time to start winning your old customers back. Assuming you’ve done everything in the previous step, your company’s name should be losing its tarnish.

Those old customers will remember when they were wronged, though. This won’t just go away with time. This is especially true if a rival company has already snatched them up. You’ll need something special to win those folks back.

One way to do this, depending on the age of your company, is to instill a feeling of “nostalgia” in those former customers. Remind them all the good things about your business and what you can do for them. Also, tell them what the plan is for your business in the future if they switch over.

The main thing, though, is to let everyone know that your big error will never happen again! Above all else they want to feel like you have their best interests in mind. At all times keep in mind they may be looking for ways you’re messing up again – don’t give them that reason. Mind everything you do and every word you say and you may just be able to win most of your formerly offended customers back into your confidence.

How would you go about restoring your customers’ confidence during a crisis?

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