Wednesday, December 06, 2006

"No Decision"

The other day, a friend and I were discussing "the competition,"  with our conversation revolving around non-profits. Claire offered the notion that your competitor is not just - and maybe not even primarily - the non-profits that are providing services in your space.  According to a theory that had been suggested to her, a non-profit's real competition is other charitable sectors. In other words, social service agencies don't compete with other social services agencies so much as they compete with medical, arts, educational, environmental, etc. causes. Under this theory, when you compete as a non-profit, you shouldn't makethe case that compares you to others in your "space", since this just cannibalizes giving for something you care passionately about. Instead, you should go after the money that's going to the other guys.  Here's why homelessness is more important than ballet...Here's why wiping out children's cancer is more worthwhile than animal rescue....Here's why almost anything is better than donating to the Harvard Business School.*

I don't buy this argument 100% (nor does Claire), but it got me thinking about competition in general. As with most marketing issues, what applies to a non-profit typically applies to the business world, as well.

I spent many years in the "development tools" space, and a few more with tech services providers. In both cases, we competed both with products and services that directly and similarly filled a need. In a larger sense, we also competed for a piece of the larger technology budget dollar, and were thus competing against any software, hardware, networking, etc. purchase. In an even larger sense, we were competing against any corporate spending that was not IT-related (new laptops are more important than new chairs).

It's useful to think through the competition this way, but it's obviously easier to compete against another product than it is to compete against another line item or general area - especially when that line item is owned by someone else, and you're bound to create friction and enmity as you go along.

But when I looked back on all the competitive situations I've been in, all those win-loss analyses, the biggest competitor has been "no decision," "do nothing," "business as usual." (Which, not incidentally, is the biggest competitor in the non-profit world as well.)

For marketing, that means being table to demonstrate how your product or service is going to save time, save money, or make money (or in non-profit terms, do good).  And when you're competing against "do nothing", you need to be able to talk to people realistically and convincingly (without scaring them half to death) about what the costs are of transitioning from the current state they're in - which may not be optimal, but which is known and comfortable - to the nirvana that can be theirs with your product or service.

"No Decision." "Do Nothing." "Business as Usual."

It's either because there's no budget. Or no real need. Or because there's political wrangling going on that you're not party to (and may not want to be). But it may also be because you haven't really made your case, or our sponsor doesn't have the goods to sell the deal internally. Marketing needs to have the tools in place that make a compelling case for your product or service, and give your sponsor the support he/she needs. Or those W-L tables will keep showing "No Decision" where there could be "W's".



*This one is courtesy of my brother-in-law, an exceedingly generous man who for years answered the shakedown request from an HBS classmate who is also a close friend of his, by saying "If you can name me one charity less deserving that Harvard Business School, I'll make a donation." After years of coming up empty, the friend finally had an answer: Harvard Law School. That year, Rick wrote HBS a check. 

1 comment:

Mary Schmidt said...

I'd submit we look at this a different way (particularly for non-profits) - Learn the customer's/donor's points of passion and work from there. Otherwise, it'll do little good to give a "competitive" pitch. They're not going to engage.