This article provides a pointers to how to understand competitors by isolating the need to knows. Knowing your competitors and what they offer will help you offer better products. And to be able to set competitive pricing and respond to rival marketing campaigns. Use this knowledge to create marketing strategies to take advantage of their weaknesses. And improve your own business performance. Assess threats posed by both new market entrants and your current competitors. To knowledge will help you to be realistic about how successful you can be. And provide you with a baseline.
Who are your competitors?
We all face competition. It doesn’t matter if you think you don’t have any competitors. There will be other businesses where customers will spend their money on them instead of you.
Technology has opened up massive opportunities. But it’s also opened the door to a world of competition. But it’s not just from your direct competition. A substitute product or the alternative ones who could make your offering redundant. The new competition which could completely eradicate your market.
But competition is not a bad thing. It can also isolate partnerships, licence agreements and encourage innovation. It’s essential that you don’t just look at what’s out there right now. Be on the lookout for what’s over the horizon. The new competition and the better ways of doing things.
Find basic competitor information from:
- Looking on the web for similar products or services
- local business and national and international directories
- Chamber of Commerce
- Press and PR reports
- Exhibitions and trade fairs
- Your customers
- Your competitor’s marketing
- Patent searching and planning applications
- Site visits
- Social media
What do you need to know?
Look at how your competitors do business. Analyse these questions:
- What are the products or services and their associated marketing?
- What are their distribution channels and customer delivery processes?
- How do they price their offering? Pricing, discounts etc?
- How do they use innovation and technology within their product and services?
- What are their customer attraction and retention strategies?
- How do they portray themselves to their audience? Brands, sales message, values and tone of voice.
- How big are their teams and calibre they attract?
- Who owns the business?
- Are they looking to sell?
- How do the owners manage their business?
- What are their financials? Are they growing?
- What’s their communications and PR strategy?
Ask questions to isolate your competitors’ customers:
- Who are their target customers?
- Which type of customers are attracted to their products or services?
- Wahr do their customers think of them? What do they think they are good at and what can they do better?
- How many customers do they have? Is this figure growing or declining?
- How good are they at retaining their customers’ loyalty?
- How do they speak to their customers? Can you isolate any patterns within social media which could reveal their customer base?
What they’re planning to do
Knowing what your competitors have done in the past is “nice to know”. What’s happening now is “good to know”. Yet, knowing what your competitors will do in the future is definitely “need to know”. And that’s where you should put your efforts into. You should be able to answer questions like:
- Which customer do they target?
- What new products they’re developing?
- Do they have the financial, technical and human resources to do what they want to do?
How to understand competitors
If you are not looking at your competitive environment, then there is only one way of looking for improvement. That’s by asking yourself. Asking yourself without looking outside your environment will produce poor results. Your insight will be based on past experiences. Awash with unconscious biases, office politics and your staff just nodding their heads and agreeing with you.
The idea of Competitor Analysis is to learn about your competitors. So that you can:
- What can you learn from them?
- Can you do better?
- What they’re doing worse than you?
- Exploit their weaknesses
- What they’re doing the same as you?
- Defend yourself from their strengths
- Isolate their customers
- Generate new ideas from them to use yourself
Don’t just copy
Competitor Analysis is not about copying your competitors. It’s to understand what they are doing and do so you know how and where to innovate. It’s knowing where you can you do it even better, add more value and profits. It’s about to exploit the gaps you identify. The gaps within their:
- Product range or service
- Recruitment and retention of employees.
How to understand competitors by isolating the need to knows
How to improve your customer service reputation is often the difference between organisations. Especially if you’re operating in a very competitive market. If your competitors are outperforming you. Or doing something better than you, it’s wise to make some changes for the better. It could about improving customer service or changing your prices. Enhancing your marketing or updating your products. Look at your what your website portrays. Assess your suppliers and how you talk to your potential customers. Or work out how easy it is to buy from you.
It’s essential to ensure you are not complacent about your current strengths. This is very easy to do when you are doing well. It does not matter how successful you are. Your current offerings should still need improving. And don’t forget your competitors are looking at your strengths and weaknesses too. A good competitor will adapt and enhance your good ideas.
Hearing about your competitors
A great place to get insight into your competitors is from your competitors. Ask for copies of their marketing, phone them up and ask relevant questions. Ask for a price list and learn what discounts are offered and when. They may not tell you, but if you ring enough times, a picture will be formed. Or you receive a restraining order of course. When networking or attending a trade association event, you will come across competitors. Talk to them. They aren’t your enemy. They likely want the same as you expect for themselves. They are probably going through the same problems. Is there a way of collaborating or getting them to talk about their problems? So they tell you how they resolved them. It may sound crazy, but it can work. People love to impress and sound clever, especially in front of a competitor.
Customers and suppliers
Make the most of your customers knowledge. Find out which competitor they could buy from and how they compare to you. Speak to your suppliers to see how their other customers are doing. They will likely not tell you everything, but a little piece of information here and a bit there goes a long way.
Test the information you find about them. This will allow you to determine the market gaps to exploit. It should also indicate whether there is a saturation of suppliers in certain areas. Which might lead you to focus on less competitive sectors or regions.
This article provided answers to how to understand competitors by isolating the need to knows. Knowing your competitors and what they offer will help you offer better products. Use knowledge from Competitor Analysis to create marketing strategies to take advantage of their weaknesses.