Beware the Arrogance of Dismissing Competition

Sometimes it’s possible to lose sight of and/or minimize something really important:  the competition also wants to win.

Most marketing plans include discussion about the competition and/or a competitor analysis; and most new product gate processes require a competitive assessment as well.  Yet, smart people can fall into the trap of dismissing real competitive threats.  The latest example is a case where $26 beat $5 million.  How?  Read on.

A front-page news report last week provides a distressing case study about the pitfalls of underestimating the competition, and in this case the implications are more than just a change in market share.  They concern the safety of US and allied military forces overseas.  According to The Wall Street Journal, a simple $26 software program was used by enemy forces in Iraq and Afghanistan (competition) to gain access to live video surveillance feeds from unmanned Predator aircraft.  What’s startling, though, is the apparent dismissal that the enemy (competition) would be able to develop a capability to fight back against the $5 million unmanned aircraft.  Here is an excerpt from the news report:

  •  “The potential drone vulnerability lies in an unencrypted downlink between the unmanned craft and ground control.  The U.S. government has known about the flaw since the U.S. campaign in Bosnia in the 1990s, current and former officials said.  But the Pentagon assumed local adversaries wouldn’t know how to exploit it, the officials said.”  (emphasis added)

Predator Drone – photo from General Atomics Aeronautical Systems, Inc. Web site

It’s one thing to not anticipate an event or course of action.  That can happen to the best of us.  It’s something altogether different to know about a threat and to dismiss it.  Yes, all business and marketing plans are based on assumptions.  But assumptions should be fact-based and built on learning from real events.  In this case, military planners and aircraft manufacturers should have known better than to dismiss enemy (competitor) capabilities.  This is especially true because of all the learning to the contrary that was available.  There is a tragic record of the enemy (competition) being creative (e.g., 9/11 tactics and implementation) and finding inexpensive solutions to complex problems (e.g., IED warfare – improvised explosive device – that has wrecked havoc on US and allied military forces).

There are always excuses (sometimes valid) and hindsight is 20-20, but in this case the benefit of foresight was available, but not acted upon.  Here’s one explanation for ignoring the enemy (competitive) threat:

  •  “Fixing the security gap would have caused delays, according to current and former military officials. It would have added to the Predator’s price. Some officials worried that adding encryption would make it harder to quickly share time-sensitive data within the U.S. military, and with allies.”

Headline

Don’t underestimate your competition and don’t ignore your weaknesses.  A determined competitor may very likely find a way to beat you on your business playing field.  At the same time, don’t allow perceived competitor strengths to cause paralysis of action either.  Move forward if you need to, but address and fix any issues along the way that might prevent success.   And be thankful during this holiday season that, in most cases, your business and marketing decisions do not have life and death consequences.

Harvey Chimoff is a hands-on marketing leader and business-wide collaborator who builds marketing capabilities in B2B/B2C organizations that drive customer success.

 

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Can Two Worlds Beat One City?

Tough times can make strange bedfellows.

In the United States, trade associations have become ubiquitous, with industry players pooling resources to champion issues for their collective benefit.  Think milk, pork, beef, and consumer electronics, just to name a few.

But two direct competitors, just six miles apart, with proud histories as separate Indian nations, joining forces to market themselves as a distinct entertaniment destination?  Now, that’s something altogether different.

Yet, that’s what Mohegan Sun and Foxwoods casinos in southeastern Connecticut are doing.  With consumers tapped-out of discretionary entertainment funds and casino revenues declining in this difficult economy (Mohegan Sun’s net income fell 13.3% for its fiscal year 2008), the two competitors decided to team up and battle for a greater share of the region’s gaming market.  How?  They’ve targeted Atlantic City.

“We can drive more business together than we can individually,” Michael Speller, president of Mashantucket Pequot Gaming Enterprises (owner of Foxwoods) told The Wall Street Journal.

This week, the former rivals launched an advertising barrage that uses billboard ads strategically located on major highways in New York City, Long Island, and northern New Jersey.  There’s also a Web site headlined “Two worlds beat one City”  (http://www.playctcasinos.com/).  Billboards feature that headline and two more that take direct aim at the Atlantic City gaming industry:  “Way beyond the boredwalk” and “Escape the Jersey snore.”  The ads were created by Adams & Knight, a Connecticut agency (http://www.adamsknight.com/).

 Two Worlds Beat One City Billboard

Way beyond the boredwalk Billboard

Escape the Jersey snore Billboard

Mitchell Ettess, president and chief executive officer of Mohegan Tribal Gaming Authority, the owner of Mohegan Sun, speaking about the northern NJ/NYC market, told The Wall Street Journal that “we want to aggressively approach those folks and show them Connecticut is a better destination.”

According to the Norwich Bulletin, “the venture, slated to run through the end of September, is designed to position the region as a major resort and entertainment destination. The program will highlight amenities offered collectively by the resort casino properties as well as the local tourism and hospitality industries.”

Time will tell if the eight billboard ads and Web site can effectively reach and impact the desired target market.  Apparently, print ads are under consideration for a potential phase two effort.

Headline

Defining your market and competition is a strategic decision.  Sometimes the competition is more than your competitor.  It’s rare outside an industry association, and definitely a tricky dance, but just maybe your competitor can be your partner.  Be careful, though.  Be very careful!

Harvey Chimoff is a hands-on marketing leader and business-wide collaborator who builds marketing capabilities in B2B/B2C organizations that drive customer success.

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