The last guide to competition you'll ever need

Salespeople obsess about competitors. They ask sales enablement for battle cards, press marketing for exhaustive product comparison charts, and mine their networks for FUD.

But great competition doesn't begin with attacking your competitors. Great competition begins with understanding your own value, and how activating that value helps customers solve meaningful and urgent problems.

The best presentation I ever saw on competition was by my friend Richard Campione , who delivered a master class on competing at a Siebel sales kick-off (~2005). Some years later, I asked Rich if he could dig up his old slides, but they were lost to the ages. This is my own version, but with a hat-tip to Rich for the inspiration. We stand on the shoulders of giants.

Here's my seven-point formula for effective competition in enterprise technology. In mature markets, some of these elements have shortcuts — but if you take each element seriously, you'll never miss a step.

1: Sharpen the problem statement

Your product isn't inherently superior. (Most enterprise software isn't as good at making smoothies as a Vitamix blender.)

Your product may be great at solving a particular problem. But a customer will only buy if that problem is worth solving.

Customers usually don't lie awake fretting about the problem defined in our terms. They might be seeking new revenue streams, or trying to bring products to market faster, or trying to increase return on invested capital. Buyers think in terms of business impact. (At least the ones who will approve funding for your product do.)

Your first challenge is to sharpen your understanding of the business problem as the customer views it. Think in terms of the highest level objectives the company has — the kind memorialized in annual reports or executive OKRs. Remember that selling is about helping customers solve problems.

2: Define Alternatives

Before you can think about specific competitors, you must fully understand the customer's alternatives.

In general, there are three types of alternatives:

• Do nothing. With this alternative, you're competing not against other solutions but rather against other priorities. The possibility that a customer may do nothing is a strong indicator that you haven't spoken to the customer's priorities. It's almost impossible to change your customer's business priorities, or to sell out of alignment with them.? A customer who is focused on revenue growth is not going to buy a cost-cutting solution... no matter how good that solution is at cutting costs.
• Solve the problem in a different way. With this alternative, you've identified the right priorities, but the customer is considering altogether different approaches. A customer who wants to feel safe and secure in their home might consider an alarm system, a fence, a new front door, or a German shepherd. These aren't competitors in the classic sense, but they represent alternative approaches to the same problem.? (This is a classic problem when selling a cost reduction value proposition; if all you offer is cost savings, then you're competing with every possible way of cutting costs.)
• Go with a competitor. Here's your head-to-head competition scenario; the customer is already persuaded to solve the problem in a certain way.

3: Create Urgency

Your best case scenario is that a customer has a schedule backed by a genuine compelling event. Compelling events aren't just good reasons; they're deadlines backed by business consequences. Unfortunately, most customer schedules are goals or aspirations, even when called "deadlines." As a result, creating urgency is one of the most important elements of winning.

Most customers (most human beings!) only have the time and money to pursue their top one or two priorities.? If doing nothing (see #2 above) isn't realistic, then consider if a customer has to act now, or if (what the customer thinks is) a short-term delay is reasonable.

And keep in mind that growing revenue and reducing costs, while excellent reasons to do something, need more in order to get customers to do it now. "We can cut your costs by 20%" is important, but it will be equally important next quarter.?

Your challenge is to shape the definition of the problem such that it aligns well with the customer's existing priorities. For example: (1) you've promised to cut costs by 50% by July 23, (2) the only way you can do that is eliminating spend in category x, (3) therefore, you have to eliminate spend in category x by July 23, and therefore (4) you need a solution for doing so in place by June 30.

When possible, hone your "CFO argument" — what would you say to the customer’s CFO about why this investment is needed now?

4: Develop Unique Value Proposition

If you've done a good job with the steps above, now you are ready to turn to developing your unique value proposition as it applies to the customer's specific business problem.

Be sure you can express your value proposition as an "only" statement and avoid the Tyranny of ER. Again, hone your "CFO argument." Your sponsor gets three sentences to explain to the CFO why the problem needs to be solved, why now, and why with you. This is all about why your approach to the problem provides a unique way to achieve the customer's business outcome.

5: Establish Home Field Advantage

Wins and losses are often determined by home field advantage; that is, how you establish the criteria for evaluating solutions. ? It's finally time to get out those Battle Cards.? (Note that up until this point, you've barely considered who your competition is.)

For example, consider the structure of an RFP. You can often figure out if you're set up to win by looking at the outline! Simply knowing the broad categories the customer says are important will let you know if you're competing in a favorable context.

Some tips:

• When an RFP is involved, send the customer your RFP template. If your customer is obviously using a competitor's RFP template, consider declining to participate unless you can influence the criteria. A strategic "I won't play under these circumstances" can be incredibly effective. In any event, don't waste your time fighting a losing battle.
• Lay traps for the competition.? For example, take a truly unique capability, and ask the customer to make "all participants" demonstrate that capability — ideally, in real-time, with as little prep as possible. This makes the competitor scramble to keep up with you.
• Ethically, carefully, and respectfully seed highly relevant FUD, when it compromises the competition’s ability to deliver on your well-defined value proposition. Don't just bash the competition; it almost always make you look petty, desperate, or unpleasant.

6: Shape Strategy

You are finally ready to determine your competitive strategy. In general, there are four strategic plays you can choose:

• Frontal: compete directly head-to-head, when you have a clear advantage in the core requirements
• Flanking: shift the buyer’s perspective on the buying criteria, when you are better off competing on complementary or ancillary capabilities
• Fragment: go after a smaller part of the business, when you can't win the "whole thing" but you can win a key function or division
• Develop: try to delay the decision so you can build for the future, when you'll lose if this customer has to decide right now

(A fifth option — defend — is relevant in cases where you're the existing incumbent.)

Be deliberate and clear about which strategy you're choosing, and make sure all members of the selling team are aligned. (An account executive and solution consultant need to be well-aligned going into the big demo, for instance. You don't want to demo all aspects of your solution if you're pursuing a fragment strategy, because you'll be showing capabilities where you're at a strategic disadvantage.)

7: Execute and Win

You've got this.