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What is Co-Opetition


When business owners decide to effectively work together, industry competitors can reach a wider market whilst remaining to stand out among the crowd. According to Channel Futures “‘Co-opetition’ combines ‘competition’ and ‘cooperation’ into one idea”. It may seem that these two concepts are opposed, but in fact, competitors can often benefit from cooperating strategically”.

Some great examples of co-opetition include Google who supported Mozilla (Firefox web-browser), a rival to Google Chrome, to limit the expanding influence of Microsoft Internet Explorer and Apple Safari. Ford and Toyota jointly designed a new hybrid vehicle in 2013 and rivals Apple and Microsoft teamed up to design a mobile operating system.

We take a deeper look into co-opetition and how it works.

Friend or Foe?

Co-opetition takes a well-thought-out plan and a creative take on traditional ways of doing business. Ninety-nine per cent of the time we consider others in our industry as enemies. Enemies we need to fight for customers, territory or market share. 

All companies have different strengths and weaknesses that can leave gaps between products, services and customers. When business owners can see their “competition” this way there is much more that can be done for the customer.

Fill The Gaps

Channel Futures further states that “co-opetition eliminates these gaps. Co-opetition looks vertically at a market and recognises that competitors can also be suppliers and that a company might have good market penetration in one region, but not in another”.

This allows companies to look at their differences as opportunities and instead of competing, companies find ways to compliment each other. According to business writer Phillip Poarch “, this approach transforms differences into growth opportunities for both parties. Competitors then become collaborators, developing joint solutions that more completely fulfil the customer’s need”. 

Customers for the Win

When companies decide to collaborate to bring a more comprehensive service or product for the customer everyone wins. If you want to incorporate co-opetition to help your business grow start with the four basic growth strategies:

Market penetration – Co-opetition facilitates market penetration; by working with other companies in your target markets, you bring more complete services to customers.

Market development – By entering into a co-opetition agreement with your competition who may deliver the services you lack, you can serve your customers more effectively.

Product development – Two competitors can work collaboratively to develop new offerings, using the solutions and expertise both have already developed. 

Diversification – Coopetition can allow your business to diversify, by working with others in related industries.

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