Recently I received some unsettling information from a trusted resource (A long time Customer).  I found out as a direct result of a conversation that this person had that one of our competitors was maliciously spreading rumors about our company.  Come to find out that these rumors were spread to not only a few of our customers but also to a number of our valued supply chain partners.

So here I sat, with the feedback of a loyal customer who came to me both out of disgust (for how the competitor acted) as well as concern asking me some hard questions about our company. (In the event any of this was true)

The good news was that none of what the customer was told was true.

The bad news was that I had to make a difficult choice with significant risk either way.

  • Choice 1: Be diplomatic, act with high integrity and seek the customers trust; risking the customer suspect validity to the rumors since I refuse to aggressively combat them.
  • Choice 2: Go on the defensive, Play their game and get involved in a war of wits.  (In this case winning the battle would be like beating your 6 year old in a foot race and then trying to brag about it)

Bottom line, there is no winning here.  Moreover, I seriously hate the childish antics that surround defending disingenuous information.

Nevertheless, this type of information can certainly collateral damage and as senior management the choice of response carries risk.

When you operate in a competitive environment, negative dialogue happens all the time. For some companies it is their strategy.  While not a good one, it can work if they play to the customers insecurities.  In this particular case it was a large customer and the information was grossly inaccurate and potentially quite damaging.  References to financial turmoil were made that posed a threat on our ability to carry out even simple transactions.

Given that we are a private company, there is no way that this particular competitor could have known this and the fact is that the information was just plain wrong.

What I have done:

My response to the customer was 100% relationship focused.  I reached out to the customer and let them know how meaningful it was that they were so forthright as to share the information.  I then reiterated the inaccuracy.  I chose to at no point mention in any way shape of form the competitor because I didn’t want to validate them nor get into a he said she said conversation.

I also reached out to our supply chain partners and dispelled the rumors.  I decided to take the proactive approach and share with the entire supply chain to reduce the risk of having to send out follow ups or engage in this type of conversation again in the near future.

The Outcome:

By handling the situation the way I did, it seems business as usual has continued and the customer has stuck with us for now.   Our vendors are satisfied as well, and have been mostly positive based upon the candid communication.

The Question:

At no point did I actually address the competitor and their bad behavior.  This is an area that I am sensitive to.  As I vacillate between law suits and silence I ask the following questions.  If a situation like this was to occur again…

  • Should I engage the competitor directly?
  • What risk does acknowledging the competitor’s bad behavior pose?
  • What would you do?

I look forward to your response!

 

 

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Daniel Newman

Founder and President at Broadsuite, Inc.
After 12 years of running technology companies including a CEO appointment at the age of 28, I traded the corner office for a chance to drive the discussion on how the digital economy is going to forever change how business is done. I'm an MBA, adjunct business professor and 2x author of best-selling business books including "The Millennial CEO" and "The New Rules of Customer Engagement." Pianist, soccer fan, husband and father, not in that order. Oh and for work...I'm the Founder of Broadsuite, a specialty marketing firm that helps companies be found, seen and heard in a cluttered digital world.
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