August 20, 2010 12:45 PM
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How to Displace an Entrenched Competitor
I just got another interesting email from Landy Chase, author of Competitive Selling: Out-Plan, Out-Think, and Out-Sell to Win Every Time. In it, he provides some excellent advice about how breaking into an account that's already "owned" by a competitor. Check it out:Nothing is more rewarding for any business than taking an account away from a competitor. Successfully persuading a competitive user to leave their existing vendor for you takes an enormous amount of patience, skill, and strategy. Unfortunately, most business people don't approach the strategic issue of competitive loyalty properly, and they pay for it with limited success in their take-away efforts.READERS: What do you think? I think Landy is right on target here. However, I'm interested to know if any of you have displaced an entrenched competitor (that wasn't about to be thrown out anyway) and, if so, how you did it.
To be successful in taking accounts away from your competitors, you have to begin by looking objectively at the situation from the viewpoint of your potential client. Consider for a moment the implications to your prospect. By asking them to move their business to you, you are essentially asking them to:
This collectively adds up to a sobering fact that you must accept and work with: Unless your prospective client is having a major problem with their vendor, trying to persuade them to abandon that relationship is an exercise in frustration and futility.
- Tell the current supplier that they are fired.
- Go through the process of setting up an account with a new supplier.
- Generate a certain amount of the tedious, time-consuming paperwork.
- Get to know a whole new set of people to work with.
- Get to know a whole new set of different and unfamiliar procedures.
- Take the risk of making a bad business decision, and paying the consequences.
Does this mean that you should abandon your efforts to sell to the competitive user? Not at all. The key to success here is to abandon the notion that you can immediately replace the existing supplier. Instead, re-think your strategy for success.
Look for ways to supplement the existing relationship without replacing it, by providing a product or service that meets a specific special need that the primary vendor is either not capable of addressing, or has chosen not to.
This approach is much more productive, and gets you over the two major obstacles you face in selling to the competitive user:
My biggest new client one year was a competitive user who told me initially that they were happy with the resource that they were using, and weren't open at that time to new alternatives. Accepting this, I was able to persuade a decision-maker within the account to allow me the opportunity to supplement their existing relationship by delivering a specialized service that the current supplier was not addressing.
- STEP #1: Find a way to get your foot in the door and prove yourself.
- STEP #2: Turn the prospect into a customer, opening the "pipeline" for additional opportunities if you deliver.
This initial program soon led to more opportunities, and before long I had successfully acquired a full business relationship that has proven to be one of the best I have ever had. This strategy worked because I requested -- and received -- a small opportunity to prove myself, without threatening the existing vendor relationship.
Look for ways to supplement, not replace, the needs of the competitive user. By delivering value on a small scale now, you can position yourself to reap big rewards later.
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