>When a competitor started posting negative comments about their company online,
When a competitor started posting negative comments about their company online,
When a competitor started posting negative comments about their company online, the founders of Nurse Next Door had to decide how to fight back.
Defense Strategy When Nurse Next Door was attacked, Ken Sim (left) wanted to lie low. His co-founder, John DeHart, wanted to be aggressive.
One morning last January, a franchisee of Nurse Next Door in Edmonton, Alberta, sent an e-mail to company headquarters in Vancouver, British Columbia. John DeHart, Nurse Next Door’s co-founder and co-CEO, clicked on a link in the message, which led to the website of Eldercare, a competing company based in Toronto. Like most other players in Canada‘s home health care industry, Eldercare was small, localized, and owned and run by trained nurses rather than business professionals. In fact, DeHart would soon learn, Eldercare’s nursing pedigree was the point of its posting.
“Why choose Eldercare Home Health?” the posting asked, and then provided an answer: “Eldercare Home Health is not a franchise and we do not sell franchises. All our care comes from a registered nurse’s perspective.” Then the tone turned belligerent. “Many other companies,” it went on, “are run by people with little, if any, formal health care training or credentials.”
The posting continued in that vein, pointing out that, “at one company,” the franchise owners came from careers in coffee shop and call center management, while another owner “specializes in entrepreneurship.” The piece concluded by asking, “Are these really the people you want to entrust with the care of your loved ones?”
Though the text didn’t mention the “other company” by name, its identity was unmistakable: Nurse Next Door is the largest franchised, nationwide home health care service in Canada. DeHart, a tech entrepreneur, and his partner, Ken Sim, a former investment banker, founded the company in 2001, shortly after each had moved to Vancouver. The idea was born when Sim’s wife, pregnant with the couple’s first child, was confined to bed rest. Sim called a home care nursing service for help. Chatting with the woman sent by the service, Sim learned that she had been employed by the company for only one day and had never met her bosses. Sim was appalled, but the entrepreneur in him sniffed an opening.
DeHart was enduring similar trials finding help for his grandmother, who suffered from dementia. The two young men decided to go into business in the Vancouver area, running a stable of handpicked home health care workers. The venture proved successful. After five years and mindful of an exploding population of senior citizens throughout North America, they decided to franchise their model across Canada. The franchisees would be responsible for hiring caregivers and marketing their services locally, while scheduling, billing, and all other customer service and logistics were handled back at the mother ship in Vancouver. This idea also took off, and the company is projecting revenue of $30 million for 2011.
The Eldercare posting, Sim recognized, showed that his company’s success had seriously ruffled the feathers of its more traditional competitors. The implicit smears turned starkly explicit as Sim read on: The authors had pasted a photo of the distinctive pink car driven by Nurse Next Door caregivers nationwide, with the company’s logo in clear view on the door. “As you might have guessed,” the message concluded, “the focus of these companies may be on selling franchises.”
This struck Sim, 40, as defamatory. The question was how to respond to it. “My first thought was to let it go. Here was this small company with an obscure website that was probably read by about a dozen people. Did we want to call attention to it?” But DeHart, 38, reacted more emotionally. “That posting hit me like a punch in the gut,” he says. “I took it personally. We’d been building our brand for 10 years. Now here was this competitor questioning, in a cheap-shot manner, our integrity, our quality, and our decision to franchise.”
The management team consulted an attorney, who said Nurse Next Door had a strong case. DeHart drafted a letter to Lisa Wiseman, the head of Eldercare (Wiseman did not respond to repeated e-mails and phone calls requesting comment for this article), warning that if the company didn’t take down the posting or at least remove the photo of the car, Nurse Next Door might take legal action. But Sim and DeHart, along with Arif Abdulla, Nurse Next Door’s marketing director, hesitated before sending the letter.
“From a tactical point of view, we thought we might be giving our competitor too much control,” Abdulla says. “What if they took our letter and ran it on their own blog? They could portray us as being thin-skinned and vindictive—a Goliath threatening David. Also, something about the letter just didn’t feel right. It wasn’t quite consistent with how we go about our business.”
For the next few days, a debate ensued at the company’s headquarters, where the walls are emblazoned with the company’s core values—Passionate about making a difference and Finding a better way—and where, in efficient yet exhaustive fashion, the management team weighs every decision. In this case, Sim came around to agreeing with DeHart: They couldn’t just let the offense pass. Jamie Birch, the company’s CFO, also felt that action was warranted but thought that the letter, backed by legal muscle, would be sufficient. Abdulla, for his part, sensed that the affront might actually be an opportunity in disguise. “We started thinking about the other tools at our disposal,” Abdulla says, “and one was social media.” That path appealed to the co-founders.