Take a strategic approach to any local media adjustments when faced with new competition.
Your business is sailing along. Your sales are good and your customers know who you are and why they shop with you. You have established a good reputation and have figured out what drives your customers to your store. Things are good until you are driving around your neighborhood and spot a “coming soon” sign on a vacant building.
It is a direct competitor and they are parking their business in your area. Now what? What will this do to your bottom line?
Here are three things to do when a direct competitor enters into your market:
1. Don’t panic
If you have built a good image and your customers know your business, then you have a head start. A new business has to change consumer habits to be successful.
On the flip side, accept the fact that your customers will sample the competition. And, that you may lose some business in the process. But, if you stay the course with your marketing plans, hopefully your losses will be minimal.
2. Do your homework
Find out about your competitor. What are their strengths? What are they known for? If you’re known for your customer service and they’re known for their low prices, use that to your advantage. Now, you know what you are up against.
Reflect on whether the competitor is too small or too big to combat. If you are a large supermarket chain and Farmer Ben sets up a tomato stand around the corner from your store, it may not be practical to put a defense plan together. Likewise, if you are Farmer Ben and a large chain starts building behind you, it may not make sense to put a lot of effort into fighting a giant; stick with what you do best. Use your knowledge of the market and long-term relationships to your advantage.
3. Remind your customer why they shop with you
Stay the course and continue to remind your customers what you have to offer. If you can combat the strengths of a competitor then add that message to the mix. Keep in mind public perception when choosing a defense message.
Defending your market share will not make you look vulnerable or insecure. Plus, if your message can associate you with something meaningful to your customers, such as supporting the community, that can help establish your competition as the “outsider.” And,being consistent will prove to be a successful strategy in the long run.
You might be thinking of pouring tons of money into your media plan to combat (and maybe squash) your new competition. Keep your eye on the potential return on your investment. As I said earlier, people are going to sample the new store; just keep reminding them why they shopped with you before. The worst thing you can do is veer from what you are good at and what you are known for.
There are some strategies for using local media to defend your market share:
1. Add additional weight to your current media buys in TV and radio
Increase the frequency of the message. Don’t overspend; adding targeted points to existing schedules will ensure your brand stays top of mind around the time of the opening.
2. Send out a direct mail piece or sample around your store and the competitor’s new location
The piece can illustrate what you offer to the area and maybe even include a coupon or enticing offer to encourage consistent traffic through your front doors.
3. Continue the conversation on social media
Stay top of mind while people are connecting to their favorite people and places. Be careful not to slander the competitor on this platform. It is easy to do, but it will not help your image in the long run. Update your social media with new and special offers to coincide with the new store’s opening. There will be a buzz around the new store, but stay the course with your message.
It is easy to get caught up in a competitive struggle as a new competitor comes onto your turf. Rely on your established reputation and expertise. Be consistent with your message, beef up your broadcast schedules, send out a targeted direct mail piece, and be part of the conversation on social media to keep your brand top of mind with your key customers.
Sometimes staying the course and letting the dust settle after the opening of a new competitor is the best thing you can do to protect your market share and your profit margins.