Competing and winning in the marketplace is a top necessity in growing your small business. Often times, however, small business owners don’t know why they win or lose.
Understanding and selecting the right competitive strategy will ensure you are optimizing your efforts and will also make a big difference in the number of opportunities you win. There are basically three strategies you can use.
The first is called a “frontal” strategy, because it focuses on your ability to differentiate what you are offering based on your reputation, the uniqueness of your product or service, and the price you charge. If the decision-makers view your product and service as unique, you most likely will win regardless of price. If you are the low-cost vendor, then also you have a better chance of winning.
If you can’t compete with a frontal strategy, a “flanking strategy” is the next best option. Using a flanking strategy requires that you change the “buying criteria” to include things that favor your product or service. Adding additional capabilities or features, changing terms, providing incentives or committing top resources are some of the ways to do this.
The “fragment” strategy is the third competitive approach to winning. You use this strategy when the other two methods simply aren’t viable. This strategy requires that you break the opportunity up into smaller pieces, allowing you to win one part of the deal and your competitor to win the other.
Making the correct selection of the right competitive strategy requires that you understand both your customer and your competition. Picking the right strategy will indeed help you improve your win rates.