My Competitor Just Dropped $20 Million on Ads. So What Do I Do Now?

By Kevin O’Connor, Vice President of Marketing, Neopost USAI’m in a classic David versus Goliath situation. My chief competitor, a global giant, just spent a reported $20 million on a super-saturating, multimedia, national advertising campaign. They bought the whole top-shelf package: TV spots (on the Super Bowl no less), print, digital/online presence, a new emotion-evoking slogan, blah, blah, blah. But wait, there’s more. Their consumer media splash was augmented by trade press which, correctly, covered this financial phenomenon.I don’t have the kind of budget. I can’t engage multi-national consultants to formulate my company’s public persona. My company works in a B-to-B world. Our sweet spot is small to medium-sized businesses – companies with one to 500 employees.The market certainly exists. But reaching the people who write checks for business services is tricky. National broadcast ads don’t work for us. Neither do market-specific broadcast spots. Trade ads are iffy; they may reach users but not always the decision makers. Our website is potent but not an appreciable revenue stream. Yet. It’s evolving.Now What?So what am I supposed to do? The short answer: Change everything. Everything includes corporate culture, organizational design, corporate identity, product offerings, sales training, sales compensation, incentives, customer communication, customer service, employee communication and anything else that will help build long-term customer loyalty.There’s one more salient factor. All of this transformation has to occur in a company that operates in an industry that is prevalently, but incorrectly, believed to be in decline.What I’ve LearnedLet me tell you what I’ve learned since my competitor dug into his unfathomably deep pockets.• AnalyzeUnderstand the effect of my competitor’s advertising on my business plan. Just because a competitor spends a large sum of money on an advertising campaign doesn’t mean I have to do the same to compete effectively. I needed answers to a few key questions about the ad campaign. Does it affect my customers? My revenue plans? Does the campaign threaten my customers’ loyalty? Do I have solutions to sell against my competition? Should I spend money on advertising or can I create cost-effective and beneficial messages on my own?• EducateEducate every customer-facing employee about our competitor’s campaign. Make sure everyone understands the scope of the campaign, its objective and the potential affect on both parties’ customers.• InformIt is critically important that customer-facing employees are prepared to answer questions from customers and prospects about the competitor’s campaign. I made sure they had talking points that focused on our organization’s solutions as well as the reasons why we are a better choice from a product, service and value perspective. Talking points should never disparage the competitor, by the way.• CalculateDetermine the cost-benefit and the return on investment of such a large expense within my industry. It’s difficult for me to reach an intended audience through television and radio advertising. Certainly, advertising can help promote corporate identity or brand characteristics. In my business-to-business industry (mailing and shipping), however, audience awareness develops best by engaging customers and prospects directly, identifying their needs and delivering specific, cost-effective solutions. The return on the expense of a mass media advertising campaign is hard to calculate. I get quantifiable results after investing in lead-generating sources, business development campaigns and programs to place sales people in front of pre-informed customers and appropriate prospects.Not As Bad As It SeemsI (now) see this me-versus-them situation in a positive light. My competitor did me a favor. I welcome this kick in the pants because it was the atomic-level catalyst that caused me to rethink and to refocus. The result is that everybody in my line of sight benefits. My customers get better solutions and service. My employees work for a re-invigorated organization that can offer new opportunities for success. Even my competitor wins because I’m a much better player than I was 20 million of its dollars ago.[author]About the Author: Kevin O’Connor is Vice President, Marketing, for Neopost USA. The company, based in Milford, CT, provides hardware and software to mailers and shippers of all sizes. [/author]