Fight or flight: How to win against competitors with your IP
Your company has been leading in the consumer technology space for years. Sales have been great and people love your products. One day, a new start-up enters the scene, touting a new technology that promises equally good results – but at a much lower price. What do you do?
If taking the wait-and-see approach is your strategy, then this could be putting your optimism to the test. Going down this route, it is likely that in time, you will be going head-to-head on price as well. Competing on price alone does very little for your business in the long run. While you have built a stronger following through your brand, who can say that your customers will not be swayed by a better offer?
Indeed, old is not always gold. Here is some food for thought: even the world’s oldest operating company founded in 578, Kongō Gumi, is continuously innovating. This traditional Japanese construction company specialising in Buddhist temples became the first to use computer-aided design (CAD) software to optimise and improve its temple designs1. They did not rest on their laurels despite being in business for 1,428 years, and understood the importance of breaking new ground to stay competitive.
Now, back to your company – here are three top tips that can help you regain and retain your competitive edge in your industry:
1. Slow down the competition’s growth
What do you have at your disposal to slow down or even stop this new tech start-up from competing in the same space? The good news is that not every piece of new tech is actually new. While groundbreaking innovations do come by occasionally, you will often find that many new tech are in fact, built upon existing tech.
There is a good chance that this new start-up’s tech was also built upon existing tech – including your tech and background intellectual property (IP). At this point, if you already have the necessary IP protection in place for your background IP, use it as leverage to keep the competitor out through enforcement, or better yet – turn infringement into extra income for your business through licensing (see point 2).
2. Turn infringement into income
Why not consider licensing your technology to the competitor to create a new revenue stream for your company? Case in point – if you are thumbing through this article on a mobile device, there is a good chance that it is powered by a Qualcomm chip. The Qualcomm Technology Licensing unit, which grants licenses or provides rights on the use of Qualcomm’s IP, contributed USD6.358B to its (approximately 14%) FY22 revenue2.
This turns your competitors into collaborators and solidifies your position as a market leader – an absolute win-win in our book.
3. Pivot your business
If this start-up has truly one-upped you with its radical innovation and has investors with deep pockets to boot, it is time to consider pivoting your business. This does not have to mean starting something new altogether, but leveraging what you already own. Remember that you built your company to where it is today with blood, sweat, and most importantly – ingenuity. You would likely have built up some valuable intangible assets (IA) over the years. Question is, do you know what they are?
Having an IA strategy in place will help you identify what your key IA are (such as know-how, processes, supplier lists etc.) that can help you quickly and effectively pivot your business in a new direction without starting from scratch. Take a look at Fujifilm – they understood that with the turn of the millennium, the film photography market was rapidly shrinking. Responding quickly, they leveraged their invaluable IA in the field to move into seemingly unrelated markets of life sciences, pharmaceuticals and cosmetics. These new areas now contribute ¥117.85B (approximately 4.6%) of Fujifilm’s FY21 revenue3.
To end off, let us leave you with a quote from Jack Welch, former CEO of General Electric: “Change before you have to”. And your IA and IP might very well be what you need to make that leap.
IPOS International helps enterprises and industries use IP and intangible assets for business growth. To learn how you can leverage on your IP, book a complimentary chat session on your intangible assets with us today.
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