As winter trudges along and the days begin to lengthen, my mind turns to the summer garden. Out come the seed catalogs and seedling trays, and I get a bit more liberal with the canned produce we put by last fall.
And I grit my teeth and think of all the hard work that goes into preparing, planting, weeding, watering, feeding, monitoring, and harvesting an annual bed.
Five minutes’ walk away, the woods along the Eno River are already starting to put out new growth of sassafras, calamus, slippery elm, wild ginger, pippsissewa, and other sources of food and medicine. And nobody does a darn thing to make them grow. No weeding, no fertilizing, no fencing. No nothing.
The difference between the forest, the orchard, and the annual bed is a clue to one of the most powerful and misunderstood forces in nature and in business: competition.
I first encountered the concept of competition as a little kid, when I started playing organized sports. That is, when somebody cared enough about the outcome to lay down rules and keep score.
And I learned that competition meant that somebody had to lose in order for somebody else to win.
Sure, we were lectured on being good sports, and using competition to improve ourselves, but at the end of the day, it was still about winners and losers, in a zero sum game.
The sports metaphor permeates the business world, usually via another form of conflict: war. And both templates reinforce the idea that competition is basically a fight to the death. We try to "destroy" or "annihilate" our competition. Business luminaries like Intel’s Andy Groves and Whole Food’s John Mackey are famous for their paranoid and cutthroat approaches to competitive threats.
If we show mercy to our competition, or pretend that the game (or war) of business isn’t winner take all, we’re nothing but sentimental fools. And when a ruthless competitor eats our lunch because we were skipping through meadows and singing "kumbaya," it’s nothing more or less than we deserve.
That’s just how the world is, right?
Reality Check: Competition in Search Engine Marketing
As an online marketing consultant, one of my specialties is paid search. And if there’s one place in business where competition is fiercest, it’s the top half of the first page of Google for a high-potential search query.
Think about it: a bunch of AdWords advertisers are competing for the attention of people who are totally hot for something at that very moment. And everything about that page is relevant to the searcher’s query.
If that’s not competitive, I don’t know what is.
And the typical Google results page consists of advertisers who all pretty much say the same thing. Take a look at the top three advertisers for the search phrase "massage chair":
The messages offered by these advertisers can be summed up as "discounts" (ads 1 and 3) and "fast delivery" (ad 2).
So which one would you choose? Is there a clear standout among that group?
The first and third advertisers are engaged in a head-to-head competition, competing exclusively on price. The first ad includes the words "on sale… price match… free shipping…" and dollar-off discounts in the four site links. The third ad features "wholesale… save thousands… buy factory direct… massive discounts."
In this example, you can clearly see that the cost of competition is a price war that weakens both competitors. Eventually, one will win and the other will lose, based on amount of funding available, efficiency of business model, ability of the website to convert visitors to buyers, and a host of other factors.
This marketing strategy is based on the sports/war metaphor. Let’s return to nature, to see if there’s a different way of looking at competition that might produce a healthier outcome.
Back to the Garden
The massage chair example is a lot like my annual garden. I’ll plant dozens of the exact same seed in each bed. This bed is for Danvers carrots. That bed is for Clemson spineless okra. And so on.
Each plant in my carrot bed has exactly the same requirements for sun, soil nutrients, water, soil pH, protection from pests, and so on. The plants don’t help each other at all—instead, they compete for dear life.
That’s one reason I’m supposed to thin out the seedlings shortly after they start growing out of the soil, to "weed out" the weaklings and give the stronger ones a better chance at survival.
And that’s why an annual bed is so much work. An undifferentiated monoculture is unnatural. And it cannot sustain itself. So it needs my constant meddling to get to a place of production.
So what happens when I don’t meddle in the annual bed after planting?
Some carrots come up, along with lots of weeds. By the end of the first season, the bed is a tangled mess of morning glory vine, mullein, carrot, cherry tomato (a volunteer from a previous summer), and so on.
The second year, maybe a carrot or two will pop up from an overwintered seed head. They will quickly be crowded out by buckthorn plantain, Bermuda grass, bindweed, and dandelion. By summer’s end the bed will feature a couple of prickly wild blackberry shrubs.
By the third year, the blackberries will have shaded and choked out the ground covers. Sweet gum and maple saplings will poke their leaves up. Left untended, the bed will continue its return to forest, from opportunistic competition to a dynamic yet stable maturity.
A mature AdWords market is more like a forest than an annual bed. Rather than dozens of competitors who all resemble each other and must therefore shout and outdo each other with hype and discounts into order to gain and hold on to market share, there may be several "keystone" competitors, each of whom seeks to attract a particular segment of the market.
For example, let’s identify some niches in the "massage chair" market. Here’s a quick brainstorm uncontaminated by any real knowledge of this industry:
- Any business that could benefit from fancy massage chairs in a waiting room (maybe a car dealership, a doctor’s office, a bridal boutique)
- An individual with chronic back pain who wants daily relief, even when they can’t get to the massage therapist or chiropractor
- Someone with a fancy home theater who thinks that massage chairs would be just the thing while watching a bone-crunching Super Bowl or heart-warming chick flick
Put yourself in the position of a shopper in each of these categories. Is all you care about the very lowest price? Or whether you can have a chair in three hours?
Of course not. The business owner wants to know whether the chairs will pay for themselves. The back pain sufferer wants an end to the pain; to get the chair that will make things better, and not worse. The home theater aficionado is looking for a luxurious chair that won’t make annoying noises as it rocks and rolls.
Can you imagine very different ads that would appeal to these three niches? Let’s just consider the headlines:
- Waiting Room Massage Chairs
- MD-Approved Massage Chair
- Chairs for Your Home Theater
The advertisers are no longer competing on price or delivery speed, generic features that assume importance only in the absence of other factors. Now they’re speaking to specific audiences with quite different motivations and decision criteria.
The advertisers are still competing, at one level. After all, they probably still sell the same chairs. But at a different level, the intense competition of their initial marketing messages has led naturally to niching.
Head-to-head competition is not sustainable, and it’s too costly to exist in the hyper-efficient domain of nature. Just as the hyper-competitive annual bed will mature into a multi-species forest plot minus human intervention, competitors in a marketplace can also respond to competitive pressures by niching and thus reducing those pressures.
[Image: Flickr user Stuart Anthony]