Four Reasons It’s Tough to Maintain a Competitive Edge and What to do About it

Blog106_DealwCompetitors-1Business is hypercompetitive today. Technology has accelerated everything. Prospects can access unlimited data and information when and where they want. Prospects hesitate to make buying decisions, so some competitors do whatever they need to do to get their slice of the market pie, even buying the business on price.

One of my clients, an investment advisory firm, competed for a large investment portfolio with a well-known hospital. It worked for months with the investment committee, only to hear in the eleventh hour that the committee wanted to get bids from other firms. My client firm’s 40 basis point management fee, which was a win-win for it and the hospital, was trumped by the competition’s 20 basis point proposal. It knew that no one could service this account for those fees without losing money. However, the hospital’s committee didn’t seem concerned.

There are four basic reasons why maintaining a competitive edge has become so difficult:

  1. lack of differentiation

  2. well informed buyers in the marketplace

  3. the rise of different types of competition

  4. obsession about what the competition is doing.

Lack of Differentiation

Differentiation between competing products or services is much more difficult to prove today. There are two areas in sales where differentiation is necessary. First, a salesperson must be able to differentiate his product or service from his competitor’s offering. Second, and more important, the salesperson has to differentiate himself from his competitors.

Rather than sell your product or service’s features and benefits, you need to sell them as a solution (attaching them to the problem) to the prospect’s issues they are trying to solve. As we discussed in my recent eBook Six Ways to Increase Revenue and Build a Standout Sales Team, prospects buy when they want to fix, accomplish or avoid something. However, when you boil it down to a no decision, there are only two reasons why they don’t buy.

  1. They do not believe their problem is significant enough to take action, if they  recognize any problem at all, or

  2.  They do not believe the solution you are proposing will work.

Guess which one occurs most frequently? You’re right. Reason No. 1. Presenting a solution to someone who doesn’t believe they have a problem is sales suicide. Sales Benchmark Index cites that nearly 60 percent of all qualified sales pipeline opportunities end up in a no decision. So, as we have discussed in many blog posts, you need first to focus on the prospect’s vision or concept of the solution and then tie your product and service to it. In our investment advisor example above, they didn’t do an effective job of selling the value of their solution for the extra cost. The prospect saw it as the same.

Next, when we focus on the sales person as the differentiation, it’s the salesperson’s perspective that brings value. There are some drivers that contribute to prospect purchasing behavior, however, as it turns out the sales experience─how the salesperson conveys value─carries the most weight.

Most value propositions focus solely on the features and benefits of the offering and the organization, which in total, drive less than half of the ultimate purchasing decision.


As you can see from the above chart, 53 percent of buyers said it was the sales experience, not the product, service or solution or even the organization that made the difference. These findings came out of a study of buyers, who were asked the reasons they chose one supplier over another. That sales experience was driven by the salesperson who the buyers said:

  • Offered unique, valuable perspectives on the market

  • Helped me navigate alternatives

  • Provided ongoing advice or consultation

  • Helped me avoid potential land mines

  • Educated me on new issues and outcomes

  • Found the supplier easy to work with

  • Supplier has widespread support across buyer’s organization

As someone who has been using sales processes and methodologies for over 30 years, this finding was not surprising. When reviewing the data from our MHI research arm, CSO Insights, we clearly see the value of a sales process that is customer/client focused. In its 2015 Sales Management Optimization Key Trends Analysis,  what you sell is less of a sustainable competitive differentiator than how you sell.

It is critically important for sales reps to follow a clear process by which they prepare for calls, conduct themselves during calls, pursue opportunities and farm accounts. Let’s review the four definitive levels of sales process implementation:

Level 1—Random Process: Your company may be perceived as being anti-process, though what you lack is a single standard process. Essentially, sales reps do their own thing, their own way.

Level 2—Informal Process: Your company exposes your salespeople to a sales process and indicates that they are expected to use it, but usage is neither monitored nor measured.

Level 3—Formal Process: Your company regularly enforces the use of a defined sales process (sometimes religiously). You conduct periodic reviews of the process to see how effective it is and make changes based on that analysis.

Level 4—Dynamic Process: Your company dynamically monitors and provides continuous feedback on sales reps’ use of your formal sales process. You also proactively modify the process when you detect key changes in market conditions: new competitors emerging, changes in governmental regulations, shifts in the economy, etc.

Those with Level 3 and Level 4 processes beat the competition.

Well-Informed Buyers in the Marketplace

Research from Google and CEB titled The Digital Evolution in B2B Marketing provides new insight into buyer behavior, and it challenges the conventional wisdom. According to the study, customers reported to being nearly 60 percent through the sales process before engaging a sales rep, regardless of price point. More specifically, 57 percent of the sales process just disappeared.


What are buyers doing if they’re not talking to sales? They surf corporate websites to identify and qualify vendors, instead of the sales force qualifying them. They engage peers in social media to learn more about their needs, potential solutions, and providers. And they read, listen to and watch free digital content available to them at the click of a mouse. No longer is the sales force the sole source or gatekeeper of information.

The Digital Evolution study recommends focusing efforts in three areas: (1) improve marketing communication integration; (2) develop and activate a content strategy; and (3) strengthen multichannel analytics. Nothing new or breakthrough here, but the study provides good examples of how companies are executing against each point.

In my experience, if your salespeople know where the prospect is in his buying process, they can help him develop a vision or concept of the solution. If the prospect is already in the divergent thinking stage where he is looking at alternatives, he may ask you to explain how your product or service works. This point is where you need to get him to step back into the cognitive thinking stage so you can make sure he has developed a solid concept or vision of the solution so you can attach your solution to it. You must never lead any initial discussion with your product or service until you and the prospect mutually agree on the concept or vision of the solution.

Rise of Different Types of Competition

When discussing competition with sales people, their focus is on only one type, their direct product or service competitor. We define competition as any alternative solution to the one you and your company propose. Buying from your direct product or service competitor is one alternative solution─ the one that most of us mean when we say competition. But there are three others, which in my experience are more influential.

Doing Nothing. In most cases, this outcome is the biggest competitor we face. When a prospect decides that it’s not worth it to spend the time, money, resources, or personnel to fix, accomplish or avoid something, that’s a direct attack on any solution you may propose, as well as to equivalent changes offered by the competition. This outcome usually happens, as mentioned above, because the prospect does not believe their problem is significant enough to take action if they recognize any problem at all. Or they do not believe the solution you are proposing will work. The problem here?  The salesperson is selling too fast.

Using Internal Sources. The prospect you have approached decides that it’s more efficient to provide its solution to the problem you’re addressing. Today, most large companies have the resources to accomplish nearly anything they want to without outside assistance. Often they don’t because purchasing and outsourcing are considered more cost-effective. But you need to prepare to prove your value as the possibility of internal solutions is always there.

Using the Budget for Something Else. Similarly, a prospect who is considering your solution may decide that the necessary funds should go elsewhere. A colleague of mine who was proposing a sales training program lost out to a CRM provider and marketing campaign. The company felt if it could improve its marketing campaigns that the CRM system would produce needed lead generation for the sales people. My colleague didn’t consider the CRM system and marketing campaigns as real competition for the dollars the company would allocate to training.

In all three of these competitors, the lesson is the same. Going head to head with a rival company can be tough, but that is only part of the competitive picture. What you’re competing for today is the prospect’s decision to select your solution over all others.

Blog106_DealwCompetitors-4In my workshops, I always have salespeople write out, from the prospect’s viewpoint the advantages and disadvantages of going with the competition. Then we develop strategy around the “red flags” and we implement strategy around our strengths that are the competition’s disadvantages.

Obsession about Competitor Activity

Many companies focus too much on the competition rather than on their customer/clients. When you’re focusing on what your competitor is doing, you are already one step behind. When you compare yourself to the competition, you tacitly say to the prospect, “They are the standard.” “It’s their achievement we have to match.” This sentiment comes across as a “me too” argument, a weak and ineffective way to sell.

I love golf, and I am competitive. I love to win. Golf is like most games in that the mental aspect usually outweighs the physical. However, in golf, you have literally minutes between shots.

Sometimes in my competitive nature, I get focused on my opponent. Where did their ball go? What is their score? How does their swing look?

Yes, there can be some competitive advantage in observing your competition. However, none of those advantages will help you focus on your shot. The same is true for many salespeople. They get so worried about what the competition is doing that they forget to focus on what’s really important to their customer/client. It’s easy to lose focus. We want to know what our competition is doing. How can we beat the competition? The reality is that by putting your focus on creating value for the prospect and a good sales experience, as discussed above, you are taking the steps to do just that─beat the competition.

Your Takeaway

So a few heartfelt reminders.

Make sure you understand the competition and look beyond just your direct competitors. Instead of focusing on the competition in a reactive way, be proactive and focus on your strengths and eliminate red flags. I

By focusing too much on the competition, you advertise your weakness, not your strengths.

Capitalize on those strengths that are relatively unique to you to reposition and leverage yourself most advantageously in the account. And eliminate red flags by using strategic action steps, or at least minimize the impact of red flags if they can’t be eliminated. And remember your competitor’s strengths should always be considered your red flags.

See you on the upside,

For more information on how to simplify the complex sale, go to
Or call William L. MacDonald in San Diego at PleinAire Strategies LLC at 760.340.4277 or 213.598.4700

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