Pay Attention to Your Competitors
To paraphrase that famous dictum about marketing, the three most important times to analyze your competition are “always,” “always,” and “always.” This has never been truer than it is in today’s fast-changing competitive world. Consider this: 10 years ago you probably hadn’t even heard of the Internet and the World Wide Web; today your greatest competition may possibly be found there, not down the block.
We all know when we start a business that we must analyze the competition. We want to find their strengths and weaknesses, learn how to distinguish ourselves from them and develop strategies to cut into their market share.
Keeping tabs on your competitors is good offense as well as defense. You obviously cannot encroach on patents and proprietary information, but you can get some good ideas from the competition that can work for you—new ways to display merchandise, better ways to advertise, etc.
Not only is an ounce of prevention worth a pound of cure in forestalling the competition and ensuring your survival, but it also will allow you to recognize new opportunities when they occur and thus expand your market. If you haven’t been studying your competition on an ongoing basis, now is the time to start. Make an in-depth analysis of the competition a routine activity. Here are some steps to follow.
1. Define your product/service and your competition.
Try asking yourself the questions “What do I sell?” and “Who is my competition?” If you don’t know what you are selling, you don’t know who your competition is. If you don’t know who your competition is, you can’t do a very good job of analyzing them.
2. Assess the competition.
Have your competitors added, changed or dropped any products or services?
From an operations perspective, are they running more shifts? Are they hiring more employees? Are they laying people off?
From a marketing perspective, what do they stress in their ads—price, delivery, reliability and service? Where do they advertise? Have they changed prices recently?
3. Implement a strategy.
The last step is the most important of all. Take action. Don’t wait. Each day that you fail to capitalize on an advantage or allow a weakness to go uncorrected, your competition gains on you.
Make sure that your plan is implemented correctly, then monitor its results to note improvement or sluggishness. If a strategy is working, make sure you know why. If not, check for problem areas and correct them immediately. Constant monitoring and correction is critical to ensuring your success.
Keeping tabs on your competitors is good offense as well as defense.
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