Competition is often associated with stress or rivalry, but it is also a great opportunity for the company. It positively affects the effectiveness of employees, allows for better analysis of the market, and Competitive Advertising between companies positively affects the customers and their brand reception.
Competition increases mobilization, efficiency and allows to stand out from the crowd
As shown by the research published in the Review of Economics and Statistics, doing business in a competitive industry has a mobilizing effect, and can increase the efficiency and productivity of employees, which increases income within the company. According to other studies quoted in Top Dog: The Science of Winning and Losing, competition has a positive impact on 50% of employees, while 25% are not affected by it, and 25% wilt in a competitive environment.
Keeping eye on your competitors and the actions they take allows for the analysis of the market and customers; behaviour without the risk of losing profits or image losses! This allows us to make conclusions regarding our own company and implement certain solutions in it.
Also, you have to keep in mind that the more competitive a sector is, the greater the need to stand out from the competition. In every industry, you have to find a niche and define yourself in it. Of course, the question of quality of service or price is important, but it is not “sexy” for the customer. Those who like when a product, project or company has “character”, is unique and knows how to tell the story.
“Advertising is the key to business success” – especially if there’s a pinch of competition in it.
In this case, business is like sport – people need their favorites to cheer them on. Especially that everyone wants to be in the winning team.
No wonder that many companies play this game and use having competitors for advertising purposes, using Competitive Advertising, which, as research shows, positively influences brand reception. In the case of TV ads, almost 35% of the ads contain an element of such a strategy.
The best known example of Competitive Advertising is the long-standing competition between Coca Cola and Pepsi. Yet, let’s take a look at the different example from Poland: In 2019 the Estonian transporting company Bolt started a campaign to encourage people to use its services. Being aware that in Poland their biggest rival is the American Uber, they created advertisement in such a way that it refers directly to their competitor. Large banners were hanged in the streets of Polish cities with words on it: “Mrs. Uber drives Bolt”. This triggered a wave of comments, which only confirmed the effectiveness of the ad – Bolt reached potential customers.
Competition offers many opportunities, but you have to remember about the rules
Having a competitor is a great opportunity, you just have to use it properly. Apart from mobilization and an increase in efficiency, which is a positive yet side effect of competition, we can actively work to use the competition for our own purposes, especially in the case of promotion. Thanks to our natural human instincts to compete, we can win many new customers.
Of course, you have to be careful not to violate the law, as many countries have introduced advertising restrictions. And don’t exaggerate – the competition is mobilizing and interesting for customers as long as, as in sport, it is fair play.