Competition can be the proverbial thorn in the side. After all, they stand between you and customers. Being concerned about competitors is an appropriate managerial stance, and so is being appreciative of your competitors. Yes, appreciate them because they can make you and your business better. An example of a company that gets it is Jamba Juice, the better-for-you beverage maker of smoothies with more than 700 locations across the U.S. Jamba Juice made headlines recently when it launched a new product, a Cheeseburger Chill. Well, it sort of launched a cheeseburger smoothie. A YouTube video was a tongue-in-cheek nod to McDonald’s expansion into the smoothie category. Jamba Juice’s point is that it is not capable of doing burgers… so should one expect McDonald’s to extend from burgers to smoothies with a good product?
Jamba Juice has every right to be concerned about McDonald’s foray into smoothies. It has a massive distribution network in place, and McDonald’s has experience moving onto new turf from its launch of premium coffee. Instead, Jamba Juice executives view this new competitor as a spark for interest in the smoothie category. McDonald’s’ promotion of smoothies could result in more consumers considering the product category as a beverage option. And, if Jamba Juice can capitalize on that interest by appealing to consumers who would enjoy a premium product, then the outcome could be new customers and increased sales. That scenario is a far cry from the concern and even panic that can occur when a strong competitor emerges.
Competition can be a catalyst for innovation and spur product category growth. You still have to fight for your share of the pie, but there may be a larger pie to enjoy. Competitors can make your organization stronger; you have to determine how to benefit from their efforts and embrace their presence.