I’ve gotten countless calls from worried clients – petrified because a big competitor was sauntering in to town. Maybe Domino’s, Pizza Hut, whatever. They’re all freaked out and want to get some “inside secret” on beating back the threat.
Indeed, a new competitor is rarely good news. But, there may quite possibly be – a silver lining to this ominous dark cloud. Here’s why… big players come to town with a loaded bank account. They have a years worth of marketing cash – set aside. And they love to spend it.
Occasionally the big guys falter – but not very often. But, what if you could use their ocean of cash to help increase your sales? Say what?
Yeah… stay with me for a minute. Experienced race car drivers use what’s called “drafting” to conserve fuel. They allow the lead car to push through a thick invisible wall of air – spending additional precious fuel to do so. Then, they simply follow close behind and drive through the “hole” created by the lead car.
Let’s do the same thing… let’s “draft” behind the big competitor and use their pile of dough – to help us exterminate a smaller pesky competitor.
Scenario: Big guy comes to town. Independent pizzeria owners become fidgety, twitchy and jumpy. Big guy finally opens up and starts spending money at a rapid clip. Their marketing barrage bears down on the landscape like a dark storm. Independents scatter like scared rabbits… but not you. You smile and lick your lips. This is the event you’ve dreamed of. You’re going to “draft” off the big guy’s bank account and let them pull you to victory.
Hear me out.
My own personal experience with this – was when Papa John’s came thundering into town. They opened up right smack-dab across the street from me, rolled out the artillery and started pounding the area with marketing.
They had a dancing “pizza slice” out front on the sidewalk. They passed out flyers to my customers in my parking lot. They flooded the neighborhood with door hangers. And mailboxes were bursting with Papa John’s coupons (someone mysteriously shut off my gas valve that same weekend).
Funny thing though… I experienced the busiest week in our history up to that point. They – were creating demand. They were busy. I was busy. Where were all these customers coming from? Then, like a thunderbolt hitting me in the head – curiosity put me behind the wheel of my car. I wanted to see how the other pizzerias were holding up.
What I discovered shocked me… a handful of once busy pizzerias were now ghost towns. Drivers sitting out front with cigarettes dangling from their lips. An occasional customer arriving for a pick-up. Owners pacing the lobby.
The dank, musty smell of a business in trouble was thick on the breeze.
Sure enough, Papa John’s barrage of new marketing coupled with my constant marketing had created a vacuum, sucking business away from the weakest competitors and turning our little neck of the woods – into the very epicenter of the pizza universe. Over the next few weeks I stepped up my own marketing – just to be safe. ADVO, door hangers, and customer database mailings. I wasn’t taking any chances.
It wasn’t long after this; the first casualty – a pizzeria in business just less than two years – drew its last breath. Then another (just 4 blocks away). My own pizzeria was stronger than ever.
When you step back and look at the big picture – it becomes clear… there had been some sort of marketplace equilibrium. Then the big guy came to town and rattled his saber. A hurricane of marketing created temporary additional demand, and diverted existing pizza dollars away from two competitors just long enough to inflict a fatal wound.
Oddly enough, the eyebrow raising event of a big competitor landing in my front yard – had actually helped me. When the dust settled… my pizzeria had more customers and bigger profits than ever before.
This, I believe is the lesson: When a big competitor is looming on the horizon, ready to unleash a marketing storm, you can do one of two things. Cower, tremble and cringe. Or, grin ear-to-ear, step up and ride their coattails to the party.
The surest way to absolutely prevent a customer exodus in the face of new competition – is to steadily market to your own database (if you don’t have a POS you might as well just shoot your pizzeria at the first sign of a new player). On top of that however, is the opportunity to carve out a nice little piece of real estate, say – a half-mile radius around a local competitor, and…
Launch a Full Scale Competitor Attack
Lay siege to a weak competitor’s immediate trade area during this vulnerable period with a six week marketing firestorm. And no doubt, the damage caused by the big competitor’s “new store” campaign, plus your concentrated attack – will put your prey on the endangered species list.
But here’s the thing, unlike new-store marketing that goes zone-by-zone, a full-out attack means taking the entire area at once. You’re looking to deal a death-blow and you have to come in with swift and blinding violence to get the kill. You’ve got to strike fast and furious.
Plot your competitor’s location on a map. Eyeball a half-mile radius and then plan the assault. ADVO, door-hangers, direct mail solo pieces, magnet-mailers, and postcards – basically, something in the mailbox or on the doorknob each week – every home for a month and a half.
Value-added offers will bring out the best class of customer. A few free items with the purchase of a pizza (good offer to use on door hangers and postcards). But, you want to suck all the air out of the room so use price-point and discount offers as well during this 6 weeks (best with shared-mail).
Key points: “Draft” off a big competitors spending. Select a “weak” competitor to attack. Pound the area for 6 weeks straight. Go…
