Never slam your competition
The following is based on one of The Covenant Group’s clients. All of the names and telling details have been changed.
When we first met Hal Jesper, he had recently lost a number of cases he thought he was a shoe-in for to his competition, and desperately wanted to put a stop to this alarming trend.
Hal been an advisor for seven years. He had joined a local firm in the suburb where he lived. Within a few years he’d built a business that generated a steady $150,000 annually. But because the advisor population in his area had recently surged, Hal found himself fighting to gain new business and keep his client base.
Shortly before coming to see us, Hal had just lost a large case to Ollie Snowden — the third significant case he’d lost to Ollie within the past year.
When we with Hal, Norm Trainor, founded and CEO of The Covenant Group, asked him why he thought he was losing business to Ollie.
When Hal said Ollie was a pushy guy, who aggressively chased down prospects, and cajoled them into doing business with him, a red flag went up for Norm. Norm asked Hal to go over in greater detail the last case he lost to Ollie.
The prospect was Don Chu, the wealthy owner of a couple of popular restaurants in the area. The interview with Don had gone well until Don asked Hal what he thought of Ollie Snowden. Hal answered by saying he didn’t think highly of Ollie, thought he did some shoddy work, and didn’t know why people in the area were doing business with him.
Norm asked Hal why he answered that way. Hal told him he didn’t want to lose another case to Ollie and thought his prospects deserved to know the truth.
Norm asked Hal what Don’s response was.
Hal said Don didn’t say much, and they wrapped up the interview shortly after that. Don went quiet for the next couple of weeks, and the next thing Hal heard was that Ollie had won the business.
Norm told Hal a relevant story from his own experience. “A couple of months ago Norm received a call from Bruce, the VP of distribution for an insurance company. He was looking for an organization to help develop his national sales force of two thousand advisors. In the middle of their conversation, Bruce asked Norm what I thought of The Lincoln Team, a competitor. Norm told Bruce he thought The Lincoln Team was a tremendous organization that does great work for its clients.”
Hal asked me why I would praise his competition and encourage Bruce to go with them instead of us.
To answer that, I told Hal what Bruce said next. Bruce told me he had spoken to a rep from The Lincoln Team the day before and asked him about The Covenant Group. According to Bruce, the rep said he thought his organization was far superior to ours.
When Bruce asked Norm what he thought about the rep’s comments, he turned the question around and asked Bruce what he thought. Bruce said he wasn’t impressed. It put a bad taste in his mouth about The Lincoln Team. He thought it reflected badly on them, and showed a lack of confidence.
Bruce then asked Norm what he thought the differences were between TLT and TCG. Since TLT is our closest competitor, Norm responded that he keeps a very close eye on them, and follow their strategy and product line. Norm described to Bruce what he considered TLT’s strengths. He said they were certainly much stronger than us in those areas. If that’s what Bruce is looking for, Norm told him he wouldn’t be sorry going with them. Norm then elaborated on our strengths. Bruce agreed with my analysis and thanked Norm for his candour.
A couple of months later, Bruce signed off on our proposal to build an advisor development system for his organization.
Hal was floored by the story and still confused by my strategy to be so candid. Why then had his candour with Don backfired?
Norm told him he hadn’t been candid with Don. As far as he could tell, his negative comments about Ollie reflected Hal’s fear of Ollie, rather than objective analysis.
“Prospects ask us about the competition for a couple of reasons,” Norm explained. “One, they want to understand how we differ from the competition so they can make the right decision. Two, they want to get a better feel for who we are. Our response to questions about the competition generally reveals more about who we are than who the competition is. Don clearly read into your response a lack of confidence and a fear of Ollie . . . Before commenting on your competition, you need to gain a clearer picture of them. Do your homework. Find out what Ollie’s strengths are. And be honest with yourself. Analyze your differences.”
Hal agreed he hadn’t been objective enough, and asked, “Let’s say I do my homework and find out that Ollie really is a snake. I gather I should be honest.”
“No. In that case, you follow the old maxim — If you can’t say anything good, say nothing. The client is still likely to read your negative comments as a reflection of you. As I did with Bruce, you should turn the question around, and ask the prospect what their opinion is.”
Hal said, “I think I’m going to have trouble keeping my mouth shut. I don’t want to lose my business to an advisor I don’t respect.”
Norm explained, “you’re more likely to lose the business if you speak badly about the competition. I think behind the impulse to spout off about the competition is a misunderstanding of your role as an advisor. You are there to educate the prospect on their situation, explore their goals and offer solutions to help them achieve those goals. You must respect your client’s decision to choose to work with you or not. And not every prospect will want to. While you might not connect to your competition, your prospect might, and you need to respect that.”
Hal agreed that he’d answered the question about Ollie inappropriately.
Norm told Hal that part of the solution lies in defining and refining what his unique value add to his clients is, and being able to distinguish himself from the competition. Norm suggested to Hal that he gain a more objective understanding of his competition.
Over the next couple of weeks, Hal analyzed Ollie’s business. He talked to some of Ollie’s clients, read his marketing materials and articles, and drew some revealing conclusions. Ollie’s ability to tap into the small business market was no mystery. Ollie had been a small business owner himself before becoming an advisor and had a keen understanding of the needs and issues in this market. But while Ollie was strong in this market, he was noticeably weak in the professional market, where Hal excelled.
Over the next couple of months whenever a prospect asked Hal about Ollie, Hal confidently expressed his respect for Ollie’s strengths, and then explained where he thought they differed. Hal felt better about this response, and his prospects saw him as professional. And it paid off; he was able to pick some small business clients that preferred Hal’s approach and won every case where the prospect was an accountant or lawyer.
Lessons Learned
Hal learned that negative comments about the competition, even if you strongly believe them, could lose business for you, because prospects project that negativity back on to you. Rather than seeing your comments as objective, your prospects see them as expressions of your fear and lack of confidence. On the flip side, positive words about the competition earn tons of respect. Someone who is confident enough to say something good about the competition must have something extremely valuable to offer. But if you truly have nothing good to say, then say nothing. Instead, turn the question around, ask your prospect what their feelings about the competition are. Make sure any negative comments come from them, not you.
The best strategy for beating out the competition isn’t to slag them but to distinguish yourself from them. You want to express to your clients what your unique value add is. What can you do for them that nobody else can? Remember to always respect your prospect’s freedom to choose their advisor. Once you’ve effectively communicated your strengths, leave it to the prospect to decide whether they want to work with you or not. Not every prospect is meant to be your client, but when you establish confidence in your answer to questions about the competition, you stand the greatest chance of gaining every prospect you deserve.
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The Covenant Group is referred to by many as the place entrepreneurs go to become Business Builders. They are considered to be thought leaders and have authored the best-selling books, The 8 Best Practices of High- Performing Salespeople, The Entrepreneurial Journey, and The Business Builder.