How Do You "Rate" Compared to the Competition?

by By Robert Miller and Stephen E. Heiman with Tad Tuleja

To appraise any account situation, you begin by thinking with your customer's mind. You need to know how they view your company, your products, and your services. But you also need to know how they view your competition.

Remember, you are not the best judge of your competition. Your customer is. Therefore, you need to get a fix on how your important accounts view the single greatest threat to your success—your major competitors for business. This is even more subjective than trying to determine how your customers view you—probably too subjective for you or your account team to pull off alone. For this reason, we offer this advice: To determine how they feel, ask people in your accounts directly.

Here's a simple yet effective exercise to "rate" a major competitor and yourself using a 1 to 10 scale. This isn't higher math or a Psychology Today quiz. Use the scale as our corporate clients do: not to score points or to "quantify" your situation, but to get an indication of how your company's doing, how the competition's doing, and how the two of you stack up in your account's eyes.

With a notebook lying flat, divide the left-hand page into three columns. At the top of the far left column, write the heading "How Customer Sees." Head the center column "Competition" and the right-hand column "Our Company." In the left-hand column, copy down the following seven categories of assessment:

• Level of business relationship
• Understanding of customer's business situation
• Product fit to customer's needs
• Positioning in customer's organization
• Product/service reputation
• Prices
• Helpfulness to customer

Then rate how your customer views your major competition with regard to each of these categories, using a 1 if the customer's view is extremely negative and a 10 if it's the best it can be.

For example, suppose your customer believes your competitor has little or no understanding of his or her business situation: the competitor would receive a 1 or 2 on this item. If the competitor's prices are about average for the market, you'd rate them a 5 or 6. If the customer believes the competitor's products fit his or her needs very well, the competitor might get an 8 or 9 there.

Write down the individual ratings in your notebook, and then total them.

Now work your way through the assessment process again, this time rating how your company is doing in the customer's eyes. Again, if you're not sure how you're perceived by the customer, ask.

When you're done rating both yourself and your competitor, you'll have a chart that looks something like the figure shown.

Now take a look at the two ratings together. Resist the temptation to "keep score." You've organized your account information on this chart to give you a quick-and-dirty view of what's going on, not to "prove" that you're acing out the competition, or that it's got you on the run. In the example we've shown, comparing the competition's total of 49 with your company's total of 52 doesn't say anything as solid as "We're edging them out with this account"—the difference isn't statistically that significant. Unless the difference between the two totals is quite large (say, 20 points), you should be wary of concluding "from the numbers" that either your or your competitor is better positioned.

Instead of drawing hasty conclusions from the totals, you should look at the individual line items. Then try to identify the three most important facts about your account's appraisal of the situation. In our example, these might be the significant gap between "them" and "us" with regard to product fit (9 to 5), or the fact that the account sees little difference between you and the competition in terms of price (5 to 4). In addition, ask yourself the following questions, designed to qualify the quantified comparison:

• What are our competitor's chief advantages,, as perceived by this customer?
• What does this customer need, now or in the future, that cannot be easily obtained from the competition?
• What would it take for the customer to buy from us what he or she now buys from the competition?
• In what areas of the customer's organization is such a change of purchasing policy likely to happen?
• In order for it to happen, must the policy be changed at a higher level of the organization than the one where we're currently positioned?

Adapted from Successful Large Account Management Robert Miller and Stephen E. Heiman with Tad Tuleja (c) 1991 by Miller Heiman, Inc., All rights reserved with permission of Warner Books. Inc.