Once your business has clawed its way to the top, no other position in the pack will do. But, getting there and staying there are not the same thing. Your competitors are watching your every move, imitating your winning ways — and trying to figure out how to do the job just a little bit better.
When you're at the top of the pack, you still have to continuously differentiate your company from the competition, while looking for ways to do it faster, cheaper and better. Even as you continue to amass more customers, you can't let your competitors steal the customers that you already have.
The competition is trying to take your customers away through offensive marketing campaigns that attack your weaknesses. But, as a market leader, you can prevail with a good defensive marketing campaign and outstanding customer service, while proving that you do it better. Here are three suggestions that can help keep your business at the top of the pack.
1. Weigh price against profitability
One way that competitors attack your business is by pricing their products or services just slightly below your prices. Of course, as the market leader, you can probably afford to undercut competitor prices, even if it means that you have to surrender some profitability. This does not mean that you should readily take a loss, unless you're taking the loss-leader approach, where you sell certain products or services at little or no profit to attract customers to spend lavishly on other offerings.
The pack leader may, however, have a different option: charge higher prices than the competition. As the leader, your marketing campaign can sell higher-priced goods or services because they are the best, and they represent higher value. But, tread carefully. If you don't convince customers of your company's exceptional value, this approach can potentially backfire by allowing your competitors to charge more, while still undercutting your prices.
2. Develop true loyalty programs
If you're about to run out to your local print shop to order “buy-10-and-get-1-free cards”, stop the presses right now. Traditional “loyalty” programs aren’t effective for customers, as they do not build loyalty to your business, but rather, to the eventual freebie.
A true loyalty program is about getting to know your customers and turning them into brand advocates. A true loyalty program isn't as easy as bribing customers, but it's definitely worthwhile. You might want to check out my customer loyalty article for more details, as well as attend this year’s NextCon to find out the best ways to enhance the customer experience.
Here's a cautionary tale about an extreme loyalty program failure. An associate of mine has been saving pizza cards for years to get a free pizza after buying 20. She finally has those cards, but she has put off the free pizza order (along with any future orders) because the food quality suddenly plummeted.
This restaurant had the woman's loyalty because they reliably delivered tasty, crispy pizzas. By switching to soggy, bland pizzas, perhaps in an effort to save money or deliver more quickly, it took just two bad pizzas to lose that loyalty. They ended the practices that won her loyalty and they lost her as a customer. I doubt that she's the only one.
3. Regularly introduce new and improved products or services
Rumor has it that Subway may be adding fresh-cooked poultry to their deli meat offerings and McDonald's is offering adult Mini Meals and new food products, including sweet potato fries. Wendy's is experimenting with more bacon-laden sandwiches, and Taco Bell and Dunkin' Donuts might soon offer delivery. New and improved products or services are the norm within the fast food industry, but any company trying to protect its top dog position needs to do the same.
This strategy can help maintain consumer interest and give you a reason to check in with existing clients.
Getting to the top can help you stay there.
Protecting the top position may sound a bit frightening, involving constantly watching your back and beating off the competition. But, here's a silver lining for you: staying at the top is really no different than climbing to that lofty position.
Your company is successful for a reason. You worked hard and embraced a creative spirit to find ways to climb the ladder. You know how to motivate your team to be the same way. By using the same techniques that brought you to the top — and keeping an eye on the competition — there is no reason why you can't continue to thrive.
Carol Roth is a radio host on WGN, a CNBC TV contributor, a ‘recovering’ investment banker & a bestselling author of The Entrepreneur Equation. You can find her on Twitter @CarolJSRoth or at www.CarolRoth.com. She also has an action figure made in her likeness.