Is it time you started promoting your competitors?

How do you feel about actively promoting your competitor? If you’re like most people, you’ve probably never even considered it. What a stupid idea, right? It’s something that Yahoo did in the early days, prior to Google entering the scene, and helped them to become the leading search engine at the time.

They were still developing their search logic, and as a result they didn’t always deliver the most comprehensive list of search results. In order to become the leading search engine, they developed a ‘portal’ strategy whereby they would also show results from the competing search engine Excite. The premise being that a person could get all the information they needed from one source.

(In the US and Canada over the last few months Yahoo’s organic search results are actually powered by Bing however this is a different scenario, as it’s a strategic alliance where Yahoo and Bing share revenue.)

I don’t think this strategy would particularly work for a café or restaurant, or someone who sells physical products, however it could be something to consider for ‘service’ based businesses. There is a strong argument in today’s ‘information’ age, where there is an increasing focus on content, that it could be a valid strategy to promote your competitor on your website just as Yahoo did with Excite.

If you were an accountant, lawyer, IT company or even a plumber or landscaper, how would you feel about promoting your competitor on your website? Here are some thoughts to get you started:

Against

  • First and foremost, the main concern would be about losing potential sales
  • Dilute your service offering, your point of difference or your profile
  • Encourage price comparisons and reduce your margin
  • Potentially promote an inferior product, which could subsequently tarnish your reputation and trust

For

  • You become a ‘portal’ and trusted source of relevant, impartial information
  • Subsequently drives increased traffic to your site, and increased sales
  • You’re able to work with your competitor to actively grow the category together, thereby increasing your sales
  • Potentially highlight your point of difference and value, through a more direct comparison

Personally I’m happy to promote complementary products and services on my website, plus I have a number of people I refer work to because I trust them. However at this stage I can’t see myself extending this further to provide links to my competitors. I know I provide great value for money, both with the structure of my service but also my experience, so in many ways I’m not concerned about direct comparisons. I am more concerned about causing unnecessary confusion for new prospects that don’t know me.

What do you think? Is there a strategic benefit to promoting your competitor in your business?

  • I can think of sales staff at offline retailers that have (sensibly) pointed me to another retailer that carried stock they didn’t, which reinforced my likelihood of going back.

    But at a brand level, online, it is a little less clear to me whether it’s the right strategy. Complimentary products and services I can understand, but…

  • Hi Joel,

    I have a web design business in Armidale, a town of about 20000 people in regional NSW. I promote my local competitors on directory listing websites for the region. I don’t promote them on my own website, because as you said, it confuses and dilutes my message.
    I also refer work to them if I am a bit busy.

    My rationale is:
    – keep things local – I would rather see people go to a competitor that does good work locally than get ripped off elsewhere.
    – keep the “competitive” environment amicable – this helps start a dialogue and reciprocity.
    – good competition keeps me sharp – it is nice to have people who challenge you to perform better.

  • There is no question that in emerging markets, promoting and working closely with competitors goes a long way to grow the category and therefore in the long run, everyone should benefit.

    I’m agree with your final comments too, at the end of the day if you’re good enough you shouldn’t need to worry and good competition ensures you never rest on your laurels.

  • Hi Sylvano, thanks for your comments. At the end of the day it needs to fit with your business strategy and enhance what you’re trying to achieve, rather than detract from it.

    Appreciate your response.

    Cheers, Joel

  • Hi David, thanks for your comments. I think your idea of a directory listing for the region is great, and it’s an excellent way for you to support the local market, including your competition, without confusing your own offer.

    And I like the fact you refer them work also. Referral marketing is reciprocal, so the more you give, the more you will receive.

    Thanks David.

    Cheers, Joel

  • Hi Dave, thanks for your comments. Yes, I think there is a valid argument for growing a category together with your competition, as long as it’s a concerted effort and you work together on it.

    Cheers, Joel