The competitive landscape in manufacturing is continually evolving. New entrants to the market are constantly emerging, disrupting traditional buying cycles, and threatening to displace outdated enterprises. As manufacturers digress from core plans, focusing on new Internet of Things (IoT) and servitization concepts, it is easy to miss early signs of competitors entering the market and slipping away with customers. Manufacturers must not only be aware of the horizon for emerging trends, but also watch over their shoulder for fast-gaining competitive threats.
Start-ups can swoop in, claiming market share and stealing customers before they are even recognized as a threat. Thanks to crowd funding, angel investors, global logistics, and e-commerce, companies can set up in a garage and ship worldwide within a fraction of the time once required. Innovative technologies accelerate the competition’s launch rate even further. Tech-savvy entrants to the market can use virtual reality to visualize prototypes, 3D printing to create personalized components, and digitally connected supply chains and logistics companies to ship products the same day they are printed.
It is not the just low-end of the pricing spectrum that is changing. In some industries, a demand for high quality, customized, or socially-conscious goods has brought boutique suppliers into the competitive mix. Servitization is another growing trend changing the competitive landscape. Your competition may be offering outcome-based services that achieve the same end results as your products.
How do you know if the competition is making gains?
With threats popping up from all sides, maintaining market share — or gaining — can be difficult. You must be vigilant and ready to respond. Here are ten warning signs:
1. Changes in bids, quotes, and early-stage inquiries. In the past you have may have relied on salespeople to create forecasts and predict trends, or tracked the number of RFPs as an indicator of sales in the pipeline. Today, buyers conduct research online and through dialogue with peers and colleagues before making a purchase. Watch your website traffic for shifts.
2. Influencers. E-commerce solutions, as well as portals for customers and partners, need to be robust sites which can help fulfill the prospects’ need for information and recommendations. Encourage happy customers to share their stories and become advocates.
3. Are customers asking for new products or personalized products? If customers or prospects start asking for new, highly personalized products which are not in your traditional line-up, be confident that someone will fill the need. To keep competitors from out-performing you, improve agility and offer tools for managing highly configured products. CPQ solutions will help manage the quoting and design process, guiding customers through selections and providing CAD drawings of their configured products.
4. Changes in availability of raw resources. Any conspicuous market shift should be monitored, particularly if the shift relates to availability of ingredients or raw resources necessary to your product. If you are the top producer of tropical flavored ice-cream and your buyer notices a sudden shortage of mango extract flavoring among your premiere suppliers, what could be the cause? Is a competitor planning to corner the market on mango treats? Such “blips” on the radar can represent high dollar stakes.
5. Changes in social traffic. Monitoring social media is the way to capture the pulse of activity in the market—how consumers are responding to the competition. Modern marketing tools will help you track impressions, positive/negative comments about your brand, and campaign successes.
6. Left out? Not only do you need to monitor social traffic that mentions your brand name, you must be aware of conversations from which you are entirely excluded. This may mean you have missed an opportunity and the market is moving in a direction where you are not currently viewed as a viable contender. Modern marketing solutions can help manage social presence, turning this art form into a science based on facts, not hunches.
7. Billing fluctuation. Many reasons can cause fluctuations in billing. An aggressive competitor may be one, or, perhaps, customers are choosing to repair, rather than replace, equipment. Perhaps they are delaying a purchase decision, waiting for a new product release or promotional offer from you. Perhaps the fluctuation is only a natural seasonal dip, and nothing to be alarmed about. Advanced analytics with predictive intelligence will help discern dangers from normal cycles.
8. Stepping on your own toes. There may be times when your own activity, such as releasing a new product which cannibalizes sales from an existing one, is the culprit. Changes in sales territories, financing options, and policies on outstanding accounts can all impact billing. Understanding billing influences and customer habits is essential today. Advanced BI solutions help to analyze activity and separate warning signs from normal ebbs. Without modern reporting and analysis tools, managers may be relying on hunches and anecdotal suppositions to rationalize changes in sales—until it is too late.
9. Changes in customer feedback. Listening to customers is vital in retaining a competitive edge. You must know what your customers think of your products, brand, and service at all times. An annual survey is not enough. To obtain this level of insight, you need to stay aligned with customers and prospects through one-on-one engagement as well as systems that can scale to large numbers. Remember, today’s buyers tend to have short-term priorities and little brand loyalty, so check in often to pick up changing attitudes.
10. How is the experience? Buyers are continually looking for greater value, enhanced service, and an outstanding customer experience. Excellent customer experiences can take many forms, from ease of placing orders to the ability to customize products. Customer Relationship Management (CRM) solutions will help manage the customer’s buying experience and enhance engagement. Field Service solutions can help manage the call center, aftermarket service and features like extended warranties and service agreements.
Relationships offer the best defense
Enhancing customer relationships is one of the best ways to overcome competitive threats. Aligning with customers on their needs, expectations, and preferences will help keep them from even considering turning to competitors. Continually developing new product offerings and providing value-add services will also cement bonds. This offensive tactic may be your best defense against threats from competitors. If customers are offered everything they need, why would they go elsewhere?
Nick Castellina is the director of industry and solution strategy at Infor.