Competitive Web Business Strategies

Today I thought I would share a few competitive strategies that can be adopted to either offensively or defensively go against the competition in the online world. Whether or not you like competition, it does exist, and with the incredible ease and attraction of an online business you could imagine that there is a lot there. Plus it can be done all in good fun… to keep things interesting.

Offensive – Frontal Assault

This is the most aggressive competitive strategy, it involves going against the competitor head to head. This is where you match your competition in most aspects of the business from product pricing to promotional methods to distribution channels. Success with this type of strategy usually involves the attacker to have greater resources as this can be a rather costly tactic and you must be the willing to be persistent.

An example of this strategy being used is when Barnes and Noble reacted to Amazon.com entering the online bookselling business.

Offensive – Flanking Manoeuvre

This is a slightly less aggressive attack, which involves targeting only a part of your competitors market, usually in a field where they are weak. Success in this strategy can involve patience and the willingness to expand carefully to avoid being noticed by the competition and minimise the chance of retaliation.

There are many example of this occurring, in fact most internet marketers begin their web business ventures this way. One particular example of this in the past is Virtual Vineyards which had focused only on premium and speciality wines and foods.

Defensive – Raise Structural Barriers

If you happen to be in a position where you now have to defend your market position, then this strategy may be something you should think of adopting. It involves establishing a full line of products in every profitable niche in that market to close off any logical avenues of attack. This strategy usually means greater outlay in each niche and may not mean the greatest profits in each separate niche, but overall you do not need to share the market with competitors and thus have a greater overall profit.

An example of this eBay in the online auctions market.

Defensive – Lower the Inducement for Attack

Another type of defensive strategy is the ‘Lower the Inducement for Attack’ strategy which consists of showing your competitors a reduced future profits prediction in the industry, as to give them the impression that the market is not worth the effort.

I’ve been asked not to give an example from a company who uses this strategy. So you’ll just have to try it out yourself.