Trying to uproot an embedded competitor is always worth a shot.
Here’s why: The biggest, most loyal buyers are also the most likely to look at and switch to the competition, a Harvard Business School study found. If you appear to be better, prospects will listen.
But it’s never enough to just tell prospects that your product or service is better. They need specifics. Hard-line comparisons. Insightful data. Real-time results. Testimonials from people they identify with.
If you’re armed with the right information and take a strategic approach, you can beat an embedded competitor.
To break loyalty, you may need to change your approach from prospect to prospect based on account size, depth of existing relationship or industry.
“First thing is not to focus on the incumbent, focus on the customer, says Tibor Shanto, author of Everything Else is Just Talk, sales coach and speaker. “Focus on the buyer’s current objective. Where do they want to be 18 months from now? They are not looking back. Help them move forward.”
Start by learning as much about your competitors as you know about your own products and/or services. At any point in the sales journey, you’ll need to make comparisons, and your best tool is ingrained knowledge.
From there, use one of these approaches to help you beat competitors.
Beat embedded competitors with social media
Social networking can be one of the most effective inroads to prospects. And it can help you gain enough recognition and respect to sway customers who are loyal to your competition.
Try these tactics:
- Check and poach Linkedin. The prospects you target (and even those you don’t yet) are likely connected to your competitors via Linkedin. Reach out to the contacts you uncover in your competitors’ contact list. Introduce yourself, connect and give them relevant information before you explain why you’re better.
- Go big. Some organizations are sloppy with their client list, especially in social media such as LinkedIn. Look at the competition’s profile to see who they brag about doing business with and who they’re connected to, and you might get a complete client list.
- Monitor your competitions’ social. Regularly check their Facebook, Twitter and other social media pages relevant to your industry to see who’s following and commenting. Follow those people, too. When they start following you, engage without knocking the competition.
- Watch activity. Follow the competition and competitions’ customers. Keep an eye on new connections and a closer eye on lost connections. You might not see a social media breakup, but if you’re watching certain prospects you want to poach, you can see if there’s a decrease or cease in interaction.
- Stir the pot. Keep track of the topics that engage prospects the most on social media – what they like, follow, and most importantly, chime in on with the competition. Start conversations or get involved in conversations like those (that aren’t directly tied to your competitors) but are likely attractive to their loyal customers.
- Watch customer reviews. Keep an eye on the competitions’ websites and other review sites and social media platforms for customer reviews. Pay attention to what customers don’t like – and use those dislikes to differentiate your solution when the time comes.
- Respond to complaints. Take review-watching one step further and respond to customers’ complaints about your competition. For instance, you might offer a free repair to a customer who couldn’t get the right fix from his supplier. Or you can offer to set up a free trial for a customer with an unanswered complaint.
- Stay on top of the rumor mill. It sounds sophomoric but following gossip – whether it finds footing in social media or on the ground – can help you win sales over embedded competition. Watch social media for undertones or outright declarations of news such as key people leaving, new initiatives or dissatisfaction. Those are the best times to approach so-called loyal customers. Outside of social, attend award dinners, industry events and local business group meetings to hear the same kind of useful gossip.
Beat embedded competitors with content
Your social media presence is just part of the battle in the war to win against embedded competitors.
Customers loyal to a supplier will scrutinize all content you give them. And consider this: Prospects will likely share your content with your competition because they have a relationship. So you’ll be under double-scrutiny.
To maximize content when working in an embedded-competitor situation:
- Know (and address) who you’re dealing with. Canned content won’t work effectively. Review embedded competitors’ strategies, existing content and initiatives. See how often and the kind of content they post. How well liked is it? You don’t need to match their strengths but learn from them. More importantly, find opportunities to exploit their content’s weaknesses.
- Be different. The competition has been doing things that customers like longer than you. Don’t try to replicate what they’re doing to win over their customers. Instead, do something slightly different and much better with your content – perhaps leverage a different medium, target a different segment of a shared demographic or maximize a trending topic.
- Offer more. Different is good. More is better. Offer better quality content and some extra quantity compared to the competition. Do more research. Offer more channels to reach valuable content. Explore and introduce them to new, relevant topics.
- Maximize your effort. Content will fuel social media campaigns, give incentives for opt-ins and signups and build an arsenal of ready-made conversation starts and solutions. Work with marketing to diversify the content you have and increase the quality and quantity geared toward prospects who are loyal to the competition.
Beat embedded competitors through reference
Prospects who are loyal to your competition are more likely to consider you if you have a mutual connection.
“Find new people to talk to, especially people involved in setting prospects’ direction,” says Shanto. “Many of the incumbents got in on a functional level and are hanging on for dear life, while changes in direction and what to buy for the new direction are decided by others. Talk to them.”
To gain and use referrals as inroads:
- Encourage brand advocates. One of the most powerful ways to pull customers from competitors is through word-of-mouth. That happens on social media more than ever. Who are the customers or industries with the biggest interest in your brand, products and services? Support those customers and groups by referring their products and services. Then ask them to advocate for you, as well.
- Offer incentives. Offer discounts or perks to customers who can help you get in front of prospects who have an embedded supplier.
- Work with an influencer. Instead of going after a decision-maker, look for someone within a targeted prospect’s organization who can influence the decision-maker. Best bets: The people or person who uses the competition’s products or services most often (and likely have the biggest need for change).
- Get referral timing right. A referral is more effective when the timing is right (not that you want to ignore a reference at any time.) Work with references to uncover when contracts with embedded competitors are up or products are worse for the wear.
Beat embedded competitors with pricing strategies
You don’t have to be a price-cutter to win against embedded competition. But you need to have some pricing strategies that will help in that situation.
Once you’re in, “make the incumbent look and feel ‘old school,’” Shanto suggests. “Concentrate on areas that propel the buyer’s objective that you can do better than the incumbent and align those to business outcomes that drive their objectives.”
Try these pricing tips:
- Before you set your pricing strategy, know your competition’s strategy. You can base your pricing strategy on an industry standard but have a competitive advantage – not just a similar or lower price – that differentiates you from the existing supplier. Differentiate by:
- Feature. Focus on an element you have and the competition lacks – even better, focus on something the prospect has indicated it is a “must-have.”
- Quality. Use data, testing or industry awards to show that your product or service is better and more durable.
- Convenience. Show how it’s easier to buy/implement/use your solution than the competition’s.
- Special knowledge. Prove that your knowledge is deeper than the competition’s – and how prospects can tap that expertise to improve.
- Strategic relationship. Show how you and your solution will be more than a supplier at your price. You’ll be involved in developing the customers’ business.
- Stand your ground when necessary. In some cases, standing your ground on higher pricing is an advantage when working against an embedded competitor. Some buyers are leery of prices that are too low. If they haven’t seen any offers and pricing other than their existing supplier in some time, you can gain credibility by standing your ground on price based on quality.
Word of caution for plucking customers from competition
You can get so focused on plucking customers from your competition, you might forget this important point: Competitors are doing the same, trying to pluck your customers.
To avoid the steal from under your nose, test your customers for loyalty. Would they say, “I’m more than satisfied with my present supplier” when the competition comes knocking?
Find out by asking them first – and responding quickly if they even hesitate to answer the question in a positive way.
Don’t get complacent with the attention and service you give current customers in pursuit of uprooting an embedded competitor. Your customers will stay loyal when you continue to listen, learn and help them improve.