Are Competitors Stealing A March On You?
Every business should now know that staying up to date on what your competitors are up to is hugely important! Is there a new entrant that is undercutting everyone on price and taking market share? Is there a trend for package deals as opposed to single item/service purchases? Has customer service become much more important due to increased competition (e.g. Ryanair’s recent transformation)? Has someone starting doing something so different that it has disrupted the marketplace completely? If you don’t know what’s going on you are going to get left behind! Simple as. So what are you going to do about it?
A good starting point is to ask yourself how your business is differentiating itself from the competition? How are you different and more importantly does the customer view you as being different? There are multiple components to a successful branding strategy and you need to start by focusing on the importance of identifying your firm’s competitive landscape. Where does you business fit into the market landscape?
There are all sorts of niches that companies stake out and claim as their own. These range from individuals to boutique firms to large industry players and many subsectors in between. Whether you are aware of them or not, they are all out there competing for your business. This is why conducting research on your target audience is a logical first step in making sure your competitive advantage is relevant and real.
What is a Competitive Analysis?
A competitive analysis is a market research tool. It plays an important role in your firm’s marketing strategy by allowing you to establish what makes your service/product offering unique. Through identifying this differentiation your team can then tailor messages that reflect your firm’s unique qualities to attract your target audience. Collecting the data used in competitive analysis is best obtained through multiple sources, ideally through the eyes of your clients and prospects. Tapping into their perspectives as buyers provides clarity into an otherwise murky competitive landscape. After comparing internally identified competitors to those identified by your clients and prospects the differences might surprise you. After all competition is relative to your company’s target audience!
Because your target audience is making a decision on which firm to give their business to they now have the luxury of shopping around for the best fit for their needs. Your firm is not only competing against known competition but also “hidden competitors” that can satisfy the needs of your target audience without offering services similar to those provided by your company.
When you think of a competitor in the traditional sense it’s usually based on the services that the firm in question offers and who those services are tailored for. In the modern marketscape with the rise of the Internet, social media and content marketing strategies firms are now competing not only around similar services but are also competing for perceived leadership space. Even if a leadership company doesn’t offer services that directly compete with your firm, their clout in the marketplace has the power to influence buyers.
Do You Really Know Who All Yours Competitors Are?
Some studies suggest that in some industries the average company is aware of only one on four of their competitors! In other words up to 75% of a firm’s competition could be flying under the radar. This shows clearly that buyers have access to more information now than ever before. You could argue that the playing field has been levelled with both opportunities are threats presenting themselves. The knock on effect is that it’s increasingly important to be aware of your firm’s competitive landscape in order to effectively educate and differentiate.
Many companies have a very vague idea of who their competitors might be. Why not a detailed insight? The short answer is simple. Lack of research! Research on your company’s target audience is needed to bring awareness to the competitive landscape. Evidence has shown that companies with high growth and high profits conduct regular research on their target clients. Companies that conduct frequent research (at least once per quarter) on target clients outperform firms that do occasional research (less than once per quarter) or none at all.
The key is the frequency at which research is conducted. This combines with the readily available information and the ease of access to insightful data. Content that was created yesterday can become old today and could be irrelevant or misleading in a matter of weeks. The same concept applies to your competition. It is import to conduct competitive analysis and refresh your competitive insights regularly . Companies that you are competing against today may be irrelevant players in the near future. You wont know unless you stay on top of research!
At the end of the day conducting research and keeping up with industry trends may seem time consuming but it is certainly worth its weight in gold if it keeps you ahead of the curve. In addition to the growth and profitability benefits the ability to keep tabs on emerging competitors in the marketplace is invaluable in adjusting your position and product offerings. Failure to stay in the know may lead to you becoming obsolete!
Avid Partners Business & Financial Advisors Help Companies Stay Ahead of their Competition and Provide the Metrics for Success! Competitive Analysis is the Key!
Visit Us At: www.avidpartners.ie
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