“Strike the right balance between respecting your rivals and focusing on how you can beat them, and you’ll have a winning formula.” – Richard Branson
It is impossible to be at the top of your game without first understanding what you are up against. Ask anyone that sells a “commodity”, and they will tell you that their customers are often confused about what differentiates their product from that of their competitors. Why?
Because after awhile, every business starts to sound the same — promising the same benefits, in the same time frame at roughly the same cost. In order to achieve a sustainable competitive advantage in the market, you need to conduct a thorough analysis of your competition.
A web search on “Competitor analysis” mostly brings up advice for small business owners preparing a business plan. Imagine if your organization never looked at the competitive landscape after they put together an initial business plan. This approach would likely land you in the same spot as the Taxi industry when Uber came on the scene. Completely blindsided.
Strangely, most large organizations have no formal process in place for collecting competitor intelligence. But here are some benefits to putting one in place:
Now that you understand why it’s important to get a handle on your competition, how should you get started?
Conducting a competitive analysis doesn’t have to be a year-long, complex process. In fact, you are far more likely to make this part of your regular business approach if the process is simple.
With that in mind, here are 3 steps you can follow to start gaining competitive intelligence immediately.
Step 1: Determine who your competitors are
You may be able to easily come up with a list of companies that you compete with head-on. But in business, your list of potential competitors is much broader. Consider who else is vying for your prospects’ time and attention. (And if you don’t know, now is a good time to ask your customers for their input).
Step 2: Figure out what you want to know
Once you have the list of your competitors ready to go, what information should you collect about them? You may want to conduct a formal SWOT analysis, or you can use the below questions as a starting point.
Step 3: Tap into Different Sources of Information
There are numerous ways to find information about your competition – online and offline:
Ultimately the purpose of understanding where your competitors are and what they are doing is so that you can position your business for success. The information you collect will help determine where your company may have a unique advantage to provide and communicate to your prospects. And isn’t that what we all strive for?
Download our free Competitive Analysis workbook to get started.