Pinpoint your Potential Competitors: The Foundations of Market Research

In running your for-profit business, consider the fact that you are competing to win. In the same way that you would compete for the ultimate prize in a sports event, your business is aiming to win the “profit prize” from the competition. For this reason, it is of the utmost importance that you suss out precisely who your competitors are; in the business game you need to know the competition before you can beat it.

Perhaps the quickest way to figure out who your biggest competitors are, is to (figuratively) remove your business from the equation. Without your existence, who would be supplying customers with your products or services? Now, put your business back into the equation. Who is trying to “steal” your customers? On the flip side, whose customers are you trying to steal? In answering these questions you will be able to identify your direct competitors.

To identify your indirect competitors, you will need to ask yourself the following question: “If your products did not exist, what other products would customers buy to fulfil their needs or solve their problems?” These businesses tend to offer alternative products or services to those you are offering. While they may not currently be a threat, they could become your direct competition in the future.

Once you have built up a database of who your competitors are, you have the opportunity to determine their strengths and weaknesses in terms of product offerings, price, client base, available resources, customer service, and marketing material. Use this information to build a better marketing strategy, funnelling their customers your way.

Coming to Terms with the Basics of Competitor Analysis

When drawing up your business plan, creating a “competitive analysis” section is of the utmost importance. Competitor analysis allows you to understand your current and potential competition, ensuring the survival and growth of your business. Think of this as a basic profile detailing the strengths and weaknesses of your competitors; enabling you to plan ahead and be at the top of your game.

The first step in your competitor analysis should be to figure out what their strengths are in terms of service, price, inventory, convenience, and location. Balance out these strengths by noting any corresponding weaknesses that you may be able to take advantage of. Take note of their marketing strategies and consider how you could adapt your own strategies to be a step ahead of them. Take the time to figure out what your competitors’ basic objectives are and who their target markets are. Try to tweak your own objectives to set yourself up as a future industry leader.

Competitor analysis might sound complicated and time-consuming. You may have no idea where to begin. Gathering information, however, may be simpler than you think. You have a wealth of valuable resources at your fingertips. Visit competitor websites, search the web for news, public relations, blog posts, social media posts, and product/service comparisons. Make use of online tools, such as Similar Web, which uses a panel of over 100 million monitored devices to gather information, to compare your competitors’ online marketing strategies to your own.

Finally, take a trip to your competitors’ locations and get a first-hand account of their sales materials and of their customer service. Learn from their mistakes and successes.