How to Grow By Stealing Market Share

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Growth is getting harder and competition more fierce as technology markets mature - which is why ignoring competition is no longer an option.

Growth leader at Zendesk and Reforge alum, Brianne Kimmel, walks us through using her OODA Loop framework to build a competitive marketing program and systematically steal market share from competitors. 

 

How to Grow by Stealing Market Share

Competition is inevitable and turns every product into a commodity -- including yours.

For early-stage companies, competition is taboo. The goal is to build a disruptive product that shakes up an existing category, or better yet, creates an entirely new one. As your company matures you’ll need to directly compete with low end copycats and larger established companies that want a piece of your success.

For mid to late stage companies, a strategic framework for competition is required.

In addition to tracking competitive moves, there are a number of new ways to win over your competitor’s customers and win back churned customers.  

In this essay, I’ll walk you through the competitive marketing framework I’ve developed and implemented at Zendesk. As we’ve transitioned from a single product to family of products, our competitive landscape has changed. Competitive marketing was once viewed as taboo, however now it has become a growth advantage.

My Key Takeaways for Competitive Marketing:

1. How to structure your competitive marketing program.

Traditionally, tech companies have viewed competition as a potential distraction. In the early day of a startup, it’s important to stay focused on building a great product. Market leading companies and category disruptors want to avoid giving competitors free publicity. But for new players, a copycat strategy is an easy way to leverage a market leader’s credibility with scrappy competitive campaigns.

Competitive marketing is a tool you want on your side, but you’ll need to create your own cross-functional team to execute effectively.

2. Apply the Observe, Orient, Decide, Act (OODA) Loop framework to secure your position in the market.

As a member of a lean growth team, I needed to create an agile way to win over and win back competitive audiences quickly. I adapted the U.S. Air Force’s OODA Loop framework of observe-orient-decide-act and applied it to competitive marketing.

The OODA Loop favors agility over raw power in any competitive situation.

Whoever observes and reacts quicker than the competition can thereby “get inside” the opponent’s decision cycle and gain the advantage.

For the purpose of competitive marketing, we can leverage data signals and competitive intelligence to develop smarter programs to win over and win back opportunities with targeted messaging and offers.

Here’s the 30 second summary of the framework:

  • Observe -  Use competitive intelligence and intent data sources to understand when customers are in market or at risk.

  • Orient - Use qualitative insights and competitive tracking to turn competitive context into actionable insights.  

  • Decide - Create cohorts of marketable contacts and prioritize based on opportunity size.

  • Act - Build and execute a program to win over or win back opportunities with targeted messaging and offers.

3. There are a number of useful tools to help with competitive and customer intelligence.

Here are a few favorites:

  • Clearbit for gathering enriched data on target companies and prospects
  • G2 Crowd for identifying companies searching for software in our category
  • Bombora for creating intent scores for prospects based on search behavior
  • HG Data for finding companies that use competitive products via backend technology installs
  • Crayon for automated reports on changes to competitors’ products, packaging, pricing, and landing pages

In the sections below, I will explain how each tool is used to develop an end-to-end competitive marketing program.

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Ignoring your competition is keeping your head in the sand

Companies of all sizes can’t afford not to do competitive marketing. For startups in particular, competition is critical to success. There are many lessons to be learned from your competitor once you have your OODA loop in place.

Building and sustaining market share is getting harder as market competition intensifies. With open-sourced technology, it’s never been easier or cheaper to start a company and raise venture money. This landscape has created a new breed of competition that’s well funded and ready to steal market share.

Like many companies, Zendesk focused on building a great product and providing best in class customer support. But our competitive landscape has changed dramatically since the company was founded in 2007. Copycats followed us into the market - Freshdesk in 2010, Help Scout and HappyFox in 2011, along with dozens of additional low end players.

As the market leader with over 100K+ customers, we could easily ignore these competitors.

But with a better product and higher CSAT score, our message is centered on choosing a product that can scale. Differentiation and competitive marketing has become a focus for our growth strategy to ensure we’re saving prospects from potential pain points with low end competitors.  

How we’ve implemented competitive marketing at Zendesk

I spent most of my career focused on performance marketing and international growth at Orbitz and Expedia. The OTA landscape is highly competitive and dominated by two players: Priceline Group and Expedia Inc.

I joined Zendesk before it rebranded and transitioned from a single product company to a family of products. This was an inflection point for our team as we recognized that our competitive landscape had changed and we had to become actively involved in competitive conversations.

This meant we needed to create a competitive marketing strategy, spell out the tactics and assemble a cross-functional team to get it all done.

I started by looking at our own customer data for insights on how our customers decided between us and the competition. Here we found a meaningful segment of customers that we call our “boomerangs” - the opportunities lost to low end competitors that organically come back to Zendesk.

We used qualitative insights from boomerang customers to show the team that competition isn’t really about Zendesk versus a competitor. It’s about empowering prospects to invest upfront and choose a partner that’s built to scale.

The learnings that came from studying boomerangs, opportunities lost, and recent competitive wins did three things:

  1. It helped us build internal consensus around the need for competitive marketing.
  2. It consolidated support to assemble a cross-functional team.
  3. It seeded our hypothesis on competitive positioning and messaging for Zendesk.

Once we had internal buy-in and had started to build out our team, we then adapted the OODA Loop framework to structure Zendesk’s competitive marketing program.

How we adapted the US Air Force’s OODA Loop framework for competitive marketing

OODA is Observe, Orient, Decide, Act, and it’s used by the US Air Force as a framework for decision making around competition.

According to OODA, you need to do 4 things to defeat your competition:

  1. Observe what your competitor is doing.
  2. Orient yourself within the context of what you learn about your competitor.
  3. Make a decision based on the inputs and insights from steps one and two.
  4. Take action to execute against your decision.
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Over time, you can move through the loop faster and faster to compete more effectively and efficiently.

The OODA loop provides a good structure for any quick decisions, but it works especially well for competitive marketing. In many organizations, competitive insights sits with one team or it’s confined to an email update with little to no actionable insights.

With this structure, a lean team can quickly execute highly targeted campaigns.  

Here’s how you can apply the OODA Loop to steal market share from your competitor:

  1. Observe -  Use competitive intelligence and intent data sources to understand when customers are in market or at risk.

  2. Orient - Use qualitative insights and competitive tracking to turn competitive context into actionable insights.  

  3. Decide - Create cohorts of marketable contacts and prioritize based on opportunity size.

  4. Act - Build and execute a program to win over or win back opportunities with targeted messaging and offers.

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It takes some time to build a competitive marketing machine.

You will need to develop a system to Observe, Orient and Decide, but once it’s established you can quickly act and establish market dominance.

In the next section, I’ll go over exactly how we applied the OODA Loop framework to competitive marketing at Zendesk.

Step 1: Observe - Competitive Intelligence and Data to Build a Target Company List

In competitive marketing for SaaS, there are a number of data vendors available that can help you identify prospects who are searching for software in your category, reading white papers and ebooks, or recently installed a competitive product.

At Zendesk, we use multiple data sources to build highly qualified contact lists:

  • Real-time search data: G2 Crowd identifies companies searching for software in our category and provides frequency of page visits.
  • Intent data sources: Bombora is a data source that creates an intent score for businesses that are looking for customer support software, and reading about “customer experience” or “customer relationships.”
  • Technographic data: HG Data identifies backend technology installs to identify competitive product users at the company level.
Examples - comp intel data for Zendesk.jpg

To create a wide audience pool, we identify competitive product users and opportunities lost to competitors. We identify relevant contacts within the target companies and pass the contact lists to Clearbit  for enrichment. Our goal is to identify multiple decisions makers within the target company for a multi-touch entry strategy.

Step 2: Turn competitive and customer data into actionable insights

Once we have our list of contacts, we enrich them, again with Clearbit, to get detailed contextual data for personalized first touches such as industry for more personalized content. Technology tags are a great way to identify which business tools matter most.

Clearbit input and output.jpg

We also use a product called Crayon to monitor competitors’ digital footprint and receive real-time updates when competitors launch landing page and pricing changes and have big customer wins.

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Step 3: Prioritize based on opportunity size

At this step, we again use the enriched Clearbit data to bucket our prospects by company size and identify which should go into a self-serve flow, and which require a call from our sales team.

For steps one, two, and three, Clearbit has been one of the most useful tools in our competitive marketing toolkit. In many cases, we will have a company name or an IP address only, which Clearbit can enrich for the employee count, revenue, an overview of the company’s techstack, zip code and more.

Step 4: Build a personalized outreach program

In the final step of our OODA Loop, we built an automated and sales enabled outreach program to win over or win back opportunities with targeted messaging and offers. All of the data we collect in the first three steps of the loop feeds our outreach program with data that allows us to create rich personalized touch points.

We’ve tested multiple types of touch points:

  • Automated outreach with content offers
  • Product-specific guides with specific competitive pain points
  • SDR or AE calls
  • Landing pages that speak directly about competitors
  • Vendor evaluation scorecards and calculators

The ad, landing page and content offer shown below target a prospect currently using Freshdesk, and explain the benefits of switching to Zendesk.

After we cycle through each step of the loop, we then start all over again to bring our learnings back into the process. Our competitive marketing operations hinge on our ability to track the performance of all of our outreach campaigns and continually iterate, while keeping an eye on the competition.

Competitive marketing is a powerful growth lever that helps you define your value proposition and defend your position against low end and upmarket competitors. The OODA Loop provides an agile framework to observe your competition and make quick, strategic moves before your competition does.

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