In part one, I examined how the new competitive landscape falls into four categories: nimble upstarts, evolving blue chips, citizen journalists and bloggers, and technology disruptors. Some of these rivals aren’t direct competitors. They won’t appear on any formal research report from an industry analyst or measurement service like NetRatings, comScore, or Hitwise, because they aren’t categorized as competitors or aren’t big enough (yet) to be measured. These companies aren’t going head-to-head with you. Instead, they’re going against a segment of your business or revenue model. Some are doing so on purpose, while to others, like technology disruptors and aggregators, you’re just collateral damage.
Each of these companies, then, impacts your business to some degree. When you add up the companies, each of which is taking a bite out of your business, you’re in trouble. Whereas a direct competitor might be like a wrecking ball that’s big and easy for you to see coming, these indirect competitors are like termites. They’re small enough you may not notice them, but there are many of them. Together they can cause as much damage, if not more, than a wrecking ball.
For example, craigslist is a competitor to any publisher with an online classifieds business, although a publisher wouldn’t consider craigslist a direct competitor. Perez Hilton is a competitor to any entertainment publisher and even a source for discovering new music, much more than just a simple gossip blog.
Key people throughout your organization must acknowledge that these new competitors are indeed threats, even though they look different. And your team must respond. The unfortunate reality is that it’s possible, if not probable, that many people in your organization won’t believe you and may dismiss this perspective due to brand arrogance or ignorance. You’ve got to find the key data points or deliver a compelling case study or situation analysis that will resonate with your colleagues to get them to open their eyes. Fact is, if key leaders in your company don’t acknowledge the full competitive landscape, the company will suffer the consequences.
Where Did These Competitors Come From?
Publishers often ask, “How can there be so many competitors?” and “Where did these companies come from?”
The answer is fairly straightforward: all barriers to market entry have been eliminated.
There are an endless number of competitors because basically everything is free or inexpensive. Everyone has access to everything, anyone can reach the masses, and there are a lot of very smart, entrepreneurial, hard-working people on the planet. Content is readily accessible; you can aggregate it, link to it, and write it. You can leverage user-generated content. Publishing tools are free or inexpensive. There’s a large selection of easy-to-use blog software available, and there are many types of content management systems (e.g., open source) to select from to meet your needs. Prebuilt components are shared and reused, and incorporating prebuilt widgets and components like Google Maps into your site is straightforward. Software is also often free and easy to implement, as with Ning‘s social networking platform. Technology is cheap and readily available, such as Amazon Web Services, including Elastic Compute Cloud and Simple Storage Service.
Monetization solutions are also abundant and easy to deploy. You can earn revenue via Google AdSense and various ad networks. E-commerce stores can be easily set up via Yahoo Merchant Services. Payment processing is simple with PayPal, and CreateSpace and Lulu allow authors to self-publish on demand.
Marketing, too, can be free, and there are myriad communication channels: e-mail; guerilla, or viral, marketing; content syndication; YouTube; RSS; social bookmarking, and the like. In addition, brand building is possible. Anyone can build a brand if she delivers value to her target audience.
Competing in the Digital Jungle
When looking at your full competitor landscape, keep your eyes open. Look for those who don’t look like you, and offer the marketplace something compelling and different. By understanding your competitors, you’ll be better educated and prepared and be better able to achieve whatever your strategic goal is:
- To compete, survive, and thrive.
- To go the coopetition (define) route, where you partner with competitors in mutually beneficial ways while competing against them.
- To acquire some of your competitors.
- To be acquired by your competitor or private equity.
- To go out of business (hopefully not this one).
Shoot me your thoughts and feedback about competitors.
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