Any time you have had to deal with the utility company, the phone company, or the cable company, you likely have come away frustrated.
Why is it so hard to work with those types of companies?
They don't have any competition. In most cities, there is one company for each service and they have the monopoly.
Their customer service is terrible. Their employees are not empowered to make decisions. And getting any help is like pulling your own wisdom teeth.
They do not have to improve these things because there is no competition.
As business leaders, we should want more competition. It makes us healthy and innovative. It drives us to more efficiencies. And, in many cases, it provides an opportunity to create new products.
Following are five additional reasons competition is good.
Five Reasons You Want Competition
- Competition generates increased demand. It may seem counterintuitive, but the more competitors you have in your space, the more you can work as an industry to increase demand. That makes it much easier than trying to go it alone.
- Competition facilitates differentiation. You can't be different if you don't have competitors. The utility company won't give you a reason to buy from them if they are the only utility company. But as more people move to private utilities, they're going to have to figure out their key differentiator.
- Competition develops trust. The biggest issue that utility company will face when competition arrives is when everyone up and jumps ship. Consumers have lost trust and it will be hard for that company to regain it. If they had competitors now, they would be working really hard to gain, and keep, our trust.
- Competition defines an industry or category. When mobile marketing launched, it had to be explained every time. Now that there are many players in the category, pretty much everyone understands how they're being marketed to on their phones.
- Competition makes you better. It is human nature to become complacent if you don't have a reason to be motivated to change or innovate. Competition creates that reason. Apple launched the iPhone and Google, Motorola, and others jumped on the smartphone bandwagon.
Sure, we are all beat by our competitors from time to time, but when you look at the bigger picture, competition makes the marketplace much more interesting.
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