“Know Thy Enemy” – The Art of War, by Sun Tzu
“If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not your enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy nor yourself, you will succumb in every battle.”
When you run a business, it’s always a good idea to know who your competition is as this is what really keeps businesses evolving. Recently, our company was recognized as an Authorize.Net certified developer. As an aside, Authorize.Net is the most popular payment gateway which acts like your website’s credit card terminal. Back to my story… since this has happened, we’ve had a ton of phone calls asking us to integrate Authorize.Net into an already existing website. This increase in traffic and sales has been extremely welcome, but after a couple months, we realized that we were landing every single lead that came our way. And when we told them our price, people immediately said , “YES!” So, we wondered if our prices were too low.
This is the solution we provide to our average client:
- Payment information capture page with field validation in place (to include proper credit card validation) to catch any errors before the page ever needs to communicate with Authorize.Net
- Integrate the payment processing into their site and update their database as necessary
- Display thank you page
For the time it takes us to do all of this, we still believe our prices are fair. But curiosity got the better of me. There are more than 20 developers and 11 of them compete directly with us. So, I wanted to know what it was that made our clients pick us over the competition. At this point it was more curiosity than anything because we had already decided our prices were fair and we weren’t changing them. So, I decided to look at the list of developers and make some phone calls.
The plan – I wanted to find out what others were charging for the same thing we charged.
The scenario – My story is that I sell homemade jewelry on ebay and I have decided I want a real website to sell it on to cut out the ebay fees. My brother is a whiz programmer and he is developing it for me, but he knows nothing about payment processing. He told me I need to find out what people would charge to get Authorize.Net integrated into it. He would take care of the design, shopping cart, etc.
The results – I spent a few days making calls to my competitors and if someone didn’t answer, I tried to call back several times over that period. Out of the 11 companies I called, I actually spoke to 4 of them. I left messages and others didn’t return my calls. I will provide the results in a table below. I won’t list real prices, but instead will give a representation as bushels of fruit.
Company Services Included Cost My company As mentioned previously in the post 2 Bushels Company A Same services as ours 4 Bushels Company B Integration only and we would be responsible for capturing the data, validation, and thank you page 6 Bushels Company C Integration only and we would be responsible for capturing the data, validation, and thank you page 4 Bushels Company D Would not tell me anything and instead sent me to a form on their website Refused to give me an estimate until I completed a form on their website
After all of my calls, I was pretty shocked at the results. “Company A” was the company that offered similar services to us even if their cost was double what ours was. Their representative was extremely professional, knowledgeable and honest with his answers. If for some reason we were too busy to take on any integration work, I would have no problem referring someone to them.
“Company B” was a joke. He did return my call which was a plus for him, but he made the work involved sound so difficult. Granted, I was portraying a naive home-based business woman who knew nothing about websites or eCommerce. But, he was really laying it on thick. So I got right to my point, “How much would it cost?” I asked. He said, “If you provide the checkout page, all of the validation, and the thank you page, i can provide the integration for ONLY 6 bushels.” Yes, he really did say ONLY. I vomitted in my mouth a little bit when he said that but I politely thanked him and let him know my programming-whiz brother would be in touch if he had more questions on the technical side of things.
“Company C” answered the phone “Hello?”. So I asked if this was “Company C” or had I reached the wrong number and he said, “yes it sure is.” So, I proceeded to tell him my story. He didn’t seem extremely knowledgeable but his solution was the same as “Company B’s” — just a couple bushels cheaper. Needless to say I wasn’t impressed. He wasn’t professional at all and I felt I was actually disturbing him.
“Company D” was very polite and knowledgeable. The thing that really turned me off about them is they refused to give me any information over the phone and instead insisted I fill out this 6- page form on their website. So I explained that I didn’t want to fill out a form and I could give them all of the info on the phone and I just wanted an estimate and I realized it may not be exact. Sorry, no deal. So, I go to their website. I look at their form and without filling out a thing, I go to the next page. Interestingly enough, it let me through without telling me that I missed some required fields. I go through the entire form without filling out a single form element and hit submit and I get a congratulations message telling me my request has been processed. At this point I just start laughing. If I’m a client and I see this, I would have serious doubts about how secure they will make my pages.
1. Answer the damn phone . I wonder how many jobs we receive simply because we answer the phone when someone calls us.
2. Price competitively. Out of the bunch there was only one who actually seemed like a viable competitor with us and they cost double what we charge. I don’t think their cost is unjustified or inflated at all and in fact we could probably get away with charging the same thing. But, we built our codebase smart and streamlined our process to maximize reusability, so our solution can be implemented faster than theirs (most likely). This is why we can get away with charging less.
What do you think about checking up on your competitors? I wouldn’t be surprised if ours have done it to us and I welcome it because I am confident in our level of service and our prices.