One of the challenges every businessperson has to confront is their competition. Where do you stand with yours? Are you losing business to them? Does competing with them seem impossible? These and similar questions frequently cross the minds of business owners. Sometimes the competition seems insufferably huge and almost impossible to contemplate. To help you get a handle on competition, here are 3 things to know and 10 steps to take to do something about it.
Knowing your competition is just part of knowing your market. Whether you like it or not, competition is part of every market landscape eventually and it is vital to know who is on the playing field. Examining your competition will help you understand your market better and will also stimulate your creative marketing activity. Just as you must learn the needs and objections of your customers, you must learn what competition you are facing in order to know what to do to succeed.
Fighting the competition doesn’t help you get business. In fact it will usually hurt you. In the end, the other guy is just like you, trying to make his business as successful as he can. Let your competition do his best, and use what you know to do yours. Maybe you’ll both succeed. Bashing the competition or getting into price wars hurts everyone and is simply bad form. Even worse, fighting others can distract you from the important thing, building and promoting your own business!
Your most important weapon is knowledge. Market research is homework for being successful. A thorough and realistic understanding of your market (including your competition) is what will allow you to take the necessary steps to outfox the rest of the field. It will help you to position yourself in the marketplace, put your brand on everyone’s lips, create demand for your products and even price your products or services properly.
So just who is your competition? Are they in the position to take your customers? Most importantly what can you do to compete against them? Finding the answers can involve some work, but they also may surprise you. You can hire expensive companies to do this research for you, but here is a simple program you can do yourself just by paying attention and using a simple tool like the internet:
Pay attention. Watch your mail. Read the paper. Look at the billboards as you drive down the highway. Listen to your customers or people you know and notice what they are hearing about. Ask questions if necessary. Write down things that you notice, and save promotions that you receive or think are good.
Run a search. Be one of your own customers for a moment and pull up one of the major search engines like Yahoo or Google. Put in your main product and see who you find. Do you recognize the companies? Who is there? Who is not? How are they getting there? Take notes.
Make a list of your competition. By doing the above, you should have an idea of who is out there. Take stock of what you are up against. If you are doing business in a certain geographic area; concentrate on those companies within your territory. But note that you can learn a lot by looking at other areas too. Add new competitors as you find them.
Find out who they are. Review their websites, starting off in the About or Company Profile section. Here you will get an idea of how they present their company and its goals and purposes. Read about the executives and the company background, this will give you a feel for whom and what they are.
Check out their PR or News section.There you will find the latest information regarding new products, personnel, company changes, etc. What is their positioning? Are they trying to be the leader in the marketplace? Are they actually the leader? Are they trying to be different in some way?
Consider how they locate prospects. Where do you see their promotion? Internet? Direct mail? TV? Other places? Does it seem to be working? What might they be doing that you don’t know about? How easy is it for customers to contact the company?
Study how they sell. What is their sales process? Compare it to yours in terms of ease of use and most importantly, actual sales. Do they sell their goods or services online? In person? Over the phone? Compare pricing points. This will be valuable information. Look for incongruities, for example if a price on a product seems low to you, does that mean they are losing money on it? Are they using that pricing point as lure to upsell?
Learn how they deliver their products. Many companies describe their services right on their websites. What types of products do they sell? What are the specific features? Is there anything different about the way that they deliver them? Note how this compares to your products and your own delivery methods.
Compile all the data you have been gathering. Putting this valuable information on a spread sheet as a comparison chart or some other simple form will prove to be very valuable. You will want to update it regularly to stay up to date on what the competition is doing. It will not only help you now, but will assist you in predicting what they might do in the future as well, especially in the areas of pricing and distribution.
Work out your own strategy to compete. Now that you have done your homework, the hard work begins. Sit down with your top people and review this information. Get everyone on the same page and then put together a strategy that not only outflanks your competitors but positions you realistically and positively in your customer’s minds. This is not about competitor bashing, but about making yourself stand out. Make any needed changes in your operation. Put together a promotional plan and get it going. Increase your piece of the pie or bake a bigger one!
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