Competitors are on the market because your customers want to have options. They are not because of you. They are there because of your current and potential customers. But what can you do when competitors attack you? Do you have competitive attack strategies?

Yes, your customers want to choose. They want more than one option because they know that if there are competitors and they need to choose between more options, they will receive better value for their money.

In this article, we will cover defensive and offensive competitive strategies you can use when you are attacked and to attack competitors.

Understand Your Competitive Strategy

In such a way, on a market, there is you, your small business, your products and services, and your competitors, their business, and their products and services. You want to take as much market share as possible, and your competitors also work hard to take as much as possible from the market share. This battle will never stop, and you need to be aware that competitors will always look to find different ways to attack you as an entrepreneur, your small business as their competitor, and your products and services as their competitor’s products and services.

So, if you want your own business to succeed, you must understand your position and develop a strong competitive strategy to help you attack competitors and respond to competitive attacks.

Competitive Strategy

A competitive strategy is a plan of action specifically designed to achieve a competitive advantage in the market over rival businesses. It involves analyzing and understanding your competitors’ strengths and weaknesses, as well as your own, and using that knowledge to formulate a plan for success.

So, a competitive strategy is a type of corporate strategy that involves actively pursuing changes within the industry to stay ahead of competitors.

Competitive Position

Depending on market share and market power, competitors can be categorized into four roles: market leader, market challenger, market follower, and market nicher.

Let’s look at these.

1. Market Leaders

These are the biggest players in the market and have the largest market share. They have a strong brand, economies of scale, and high customer loyalty. Market leaders focus on maintaining their position by continuously improving their products or services, expanding into new markets, and staying ahead of the competition.

2. Market Challengers

Market challengers are companies trying to displace the market leaders from their top spot. They use marketing tactics like price undercutting, advertising, and product differentiation to get ahead.

3. Market Followers

Market followers are companies that copy the strategies of market leaders or challengers but don’t compete for the top spot. They may focus on niche markets or a low-cost strategy.

4. Market Nichers

Market nichers are companies that focus on a specific and narrow market segment, serving a smaller group of customers. They know their market intimately and can offer bespoke products or services.

When you understand different competitive positions and find where your business currently is, you can develop a competitive strategy that will cover tactics to evoke responses when you are attacked and competitive attack tactics.

Developing an Offensive Competitive Strategy

Types of Competitive Strategies

Usually, I divide the competitive strategies in two main categories:

• Offensive competitive strategies are strategies you will use to attack your competition and use your competitive advantage to succeed in the market.
• Defensive competitive strategies, or strategies you will use to defend your companies when competitors attack you.

Each strategy has its own advantages and disadvantages, and choosing the right one depends on the strengths and weaknesses of the business, product or service, and the competitor being targeted.

Offensive or Attack Strategies

Offensive competitive strategies usually are part of your overall marketing strategy and is developed by your marketing team.

First, you want to understand the strengths and weaknesses of your competitors and your own business. When you find strong differentiations in your favor, you will build specific strategies to attack those aspects of your competitor’s offering proactively, either directly or indirectly.

Various competitive strategies exist, including frontal, flanking, encirclement, bypass, and guerrilla attacks. Let’s look at all of them:

Frontal Attack Strategy

The frontal attack strategy is the most straightforward and commonly used approach. It involves attacking your competitor’s strengths head-on, using your own superior resources or capabilities to overcome theirs. This strategy requires a lot of resources and can be risky, but when executed correctly, it can lead to significant gains in market share.

One example of a frontal attack strategy is the “Pepsi Challenge” campaign launched by Pepsi in the 1970s. The company directly challenged Coca-Cola’s dominance in the soft drink market by promoting blind taste tests in which people preferred Pepsi over Coke. This approach helped Pepsi increase its market share and pressure Coca-Cola to improve its product.

Flanking Attack Strategy

A flanking attack strategy targets areas where your competitor is weak or has no presence. These can be specific product features, geographic markets, or customer segments not well served by the competitor. You can gain an advantage over the competition by exploiting these weaknesses without confronting them head-on.

An example of a flanking attack is Apple’s launch of the iPod in 2001. While competitors focused on improving existing MP3 players, Apple identified the gap in the market for a smart, beautiful, and user-friendly device. They went after that niche and dominated the market.

To execute a flanking attack strategy, research and analyze your competitor’s weaknesses in product, marketing, and customer base.

Encirclement Attack Strategy

An encirclement attack is when you surround a competitor and attack from all sides, attacking multiple parts of the competitor. You can do this by launching multiple products or services to compete with different parts of the competitor’s offering.

For example, Amazon did an encirclement attack on traditional brick-and-mortar retailers. They dominated online retail, then launched their line of electronic devices (Kindle and Fire tablets), then acquired Whole Foods to get a physical presence in the market.

You need to know your competitor inside out to do an encirclement attack. Launching multiple attacks at the same time will weaken your competitor overall and give you an edge.

Bypass Attack Strategy

Bypass attack strategies are used when you want to avoid direct competition with your competitor and enter the market through a different product or service, channel, or approach. This can involve targeting a different segment of customers, offering a unique product or service, or using a totally new distribution method.

For example, Netflix used a bypass attack by offering online streaming services instead of competing directly with traditional cable companies. This allowed them to tap into a growing market for digital media consumption and gain an advantage over their competitors.

To successfully execute this strategy, you need to identify gaps in the market that your competitor has not yet addressed and capitalize on them. It also requires understanding the needs and preferences of your target audience to offer something that sets you apart from your competition.

Guerilla Attack Strategy

The guerilla attack strategy is all about unconventional and often aggressive tactics to disrupt the market and win. This includes guerrilla marketing, surprise product launches or taking over.

One of the most famous examples of this is when Google entered the smartphone market with the Android operating system. They gave it away for free to phone manufacturers and disrupted Apples dominance of the iOS system and quickly got a big chunk of the market.

To launch a guerilla attack, you must be proactive and willing to take risks. You must know your target market and how your actions will impact them.

What About the Competitor’s Response to Your Competitive Attack?

One great research paper from 1994, published in Strategic Management Journal, explains how competitive attacks can reduce the chance of retaliation, or I will better say competitor’s response to an attack as a function of the subtlety of an attack:

• visibility,
• the difficulty rivals might have in responding to it in kind and
• the importance or “centrality” to rivals of the market under siege.

According to this paper, motivational theories suggest that all three of these independent variables need to be in place in order to produce a response. On the other hand, low visibility, strong difficulty for the competitor’s response, or minimal centrality would each be enough to prevent their response.

Let’s look at all three variables selectively demonstrated with three hypothetical cases.

1. Visibility of Attacking

If a competitive attack is visible, it may produce a more direct and aggressive response from the attacked company. They may publicly call out the attacker or take legal action. If an attack is not visible or hidden as something else, it may go unnoticed by the company being attacked.

In the first case, we had a visible attack. For example, suppose you run an ad campaign in which you directly attack some of your competitors. In that case, the attacked company is likely to respond in some way, whether through a counterattack or publicly addressing the issue. This means the attack is well known and can hurt the company’s reputation or market position. In this case, the competitor will likely respond quickly and aggressively to protect its brand and market share.

In a low-visibility attack where only a few people know about it, the competitor’s response may be minimal or none. This could be because they lack awareness or don’t think it’s a big deal. So, if the attack is disguised as something else, such as negative reviews from fake customers, the attacked company may not even realize it is being targeted. This can give the attacker an advantage, as they can continue their actions without any backlash.

2. Substantial Response Difficulty

The second factor, or variable, is difficulty in responding. Suppose an attack requires significant resources or effort to respond to. In that case, the targeted company may choose not to respond because of a lack of resources, time, or fear of further damage to its brand reputation.

For example, if the attack involves creating and publishing fake content that damages the attacked company’s online presence, it could take a lot of time and effort to track down and remove all instances of this content. In the meantime, it could continue to spread and cause harm. The attacked company may weigh the potential impact of responding against the effort required and choose not to take action.

However, we can not isolate this factor without combining it with two other variables (visibility and importance). Simply, you can not say that you don’t have enough resources to respond if you know you are being attacked, which can have negative consequences for your business. If you differentiate your business enough and you are a market leader, you must use your strengths to respond adequately.

3. The Importance of Attack

The third factor is the impact of the attack that have on your company or what this attack means to you. It’s not just about the size of the attack but who is attacking and why.

For example, if a competitor is launching a targeted attack on your website to steal your data or disrupt your business, this is big and needs to be addressed now.

If the attacker is just a random hacker looking for vulnerabilities to exploit, the impact is lower, and you can prioritize accordingly.

Whatever the attacker or reason, you should take every attack seriously and act. Don’t ignore any.

5 Things You Can Do During a Competitive Attack

Now, what do you need to do when competitors attack you with all their powerful weapons?

Let’s look at some tactics that will make you more prepared to handle such battles when your competitors attack you.

1. You must be ready with a competitive strategy for possible attacks.

Before you do anything else, you need to be aware that your competitors can attack you at any moment. Sometimes, the attacks will be invisible, but sometimes, they can be really significant. Sometimes, they can be announced by your competitors, but sometimes, they can be unannounced. Because of that, you will need a competitive intelligence system that will allow you to follow different competitor’s behavior and make the right decisions when it comes to possible attacks from their side.

When you know that you can be attacked at any moment, you can easily prepare yourself with all possible tools and tactics that you will use when you find yourself in such a situation.

2. You need to respond to their attacks

Yes, as we discussed the response, you must respond to their attack but with proper improvements to gain an advantage for your company.

Sometimes, you may think that they attack you because they want to hurt you, but in many cases, if their attacks are legitimate (because of your weakness or low-quality offerings), it is the best sign that you will need to make some changes in your work before you start with the counterattack.

If they attack you on your products and services, then improve your products and services. If they attack you on your business processes, start working on improving them.

Your best answer in such a situation is to improve your business and gain an advantage over the competitors who attack you.

Related: 8 Reasons Why Your Small Business is Not Profitable as You Want and How to Fix It

3. You must counterattack using offensive competitive strategies when competitors attack you.

The third is about offensive competitive strategies. When you are attacked, one tactic that your small business can use is to start a counterattack. This will make you want to defend your business and pursue new wins. Again, this counterattack also brings you another important improvement in your business.

4. You need to be close to your customers.

When competitors attack you, they want to cut your impact and value in your customers’ eyes, so you will need to handle a close relationship with your current and potential customers. That means you must work on building and managing your community around your business through targeted marketing campaigns. The community will always be prepared to help when competitors attack you.

Related: 6 Questions to Differentiate Your Small Business From Others

5. You need to expand your market share.

It is logical for any business owner to want to become part of market leaders in their own niche.

So, the last thing you can start thinking about is expanding your market and adding additional value to your current achievements, which means growing and improving your business to become a market leader.

There will always be additional possibilities outside your current market. For example, if your small business operates locally, why don’t you consider expanding it nationally? If it operates nationally, why not operate regionally, or if it operates regionally, why not operate globally?