Whether you realize it or not, your competition is watching you.
They scrutinize your activities and look at your strengths and weaknesses. They take this information and adapt it to drive their own sales and marketing efforts. More importantly, they look at your weaknesses to try to develop ways to woo customers away from you.
By thoroughly analyzing your business, they are able to gather information that helps them avoid making the same mistakes you’ve made. As a result, they are able to save time and money by duplicating your successes. We live in the land of opportunity and, although it might not seem fair at times, always remember that your competition wants your customers so their own business can grow.
Historically, you’ll see many examples of ways that people emulate the success of others. It’s a common business tactic, and competing music stores won’t hesitate to try to take your customers away from you. This is how business works. You’ll never get rid of rivals. However, there are certain defenses you can put in place to help you maintain and grow your customer base.
Get a Jump on the Competition
It’s time to turn the tables and take a proactive stance by thoroughly researching your competitors. Assessing their strengths, weaknesses and competitive advantages will help you better understand their behavior and effectiveness. This will allow you to better position your products and services by using added-value tactics rather than just focusing on price alone.
On a larger scale, your research will help you see your market with a new point of view. You can use this newly acquired information to help you avoid the mistakes that other dealers make. It will help define your new directions in advertising, promotion, store display, customer service, selling strategies, brand management and more. By building an arsenal of information about your competition, you’ll be provided with the tools you need to make better-informed decisions. Best of all, you’ll see a difference with how you’re winning new customers.
It’s important to collect and organize this information in a format that works best for you. Whether it’s entered into a notebook or an Excel file, you’ll need to be able to view and analyze this information quickly and easily.
Make sure you collect and note these fields:
>> Who are your strongest competitors?
Who are your largest competitors? They don’t all have to be brick-and-mortar dealers. Don’t forget to look deeper in your market for up-and-coming businesses and new start-ups.
>> What brands do they offer?
Sometimes, the representation of brands in each market might seem a little unfair. Even if you don’t have the most recognizable lines, you certainly can project to your customers all the value and benefits of buying your products.
>> What services do they provide?
Are they offering something unique? Why do customers keep going back? Do they offer a Loyalty Rewards Program? Do they provide free training or lessons?
>> What are their greatest strengths?
What are the reasons they might be perceived as better than you are? What makes them stand out in your community or market?
>> What are their greatest weaknesses?
What are their weak spots? Look for things they do poorly. What aggravates customers the most? Look for bad reviews online. If your competitors have better-known brands, look for weaknesses.
>> Why do their customers like them?
Listen to customers talk about the dealer. What would motivate you to buy from them? See what positive reviews you can find online.
Tools for your Research
There are several resources you can use to conduct your research and compile information.
1. Use the Internet
Visit your competitors’ Web sites. However, make sure you put your consumer hat on and look at the site as a customer would. What draws your attention? What keeps you on the site? Pay attention to anything that stands out, both positive (free clinics, special offers) and negative (confusing layout, difficulty finding products, poor navigation).
2. Do Some Spy Work
Subscribe to your competitors’ e-mail updates and newsletters. Watch how they target and market their products and services. Can you make it easier for consumers to initiate contact with you? Send a few secret shoppers over.
3. Google Trends and Alerts
Google offers free services that can help you monitor your competitors. Use Google Trends to analyze how often a particular search term is entered relative to the total search volume. Use Google Alerts to automatically send you an e-mail when something about that competitor has been posted.
4. Social Media
Monitor social media platforms like Facebook, Twitter and blogs for mentions of your competitors. It’s an inexpensive way to stay in tune with comments about the competition and the products and services they offer.
Understanding What it Means
Once you’ve compiled the info, take a hard look at what they are doing to win over customers. Understanding what drives your competitors forward will help you develop a clearer picture of how you are different. You can use this information to create strategies to do a better job in your own niche and ways to defend your market share moving forward.
It’s one thing to blatantly copy what someone does, but it’s a better path to take the knowledge you’ve learned from studying that competitor’s strengths and weaknesses and then to use it to your advantage, building a better way.
It’s important to keep an eye on other businesses in your market and, periodically, to check their status. You can rest assured they won’t be sitting still, so neither should your knowledge of them be stagnant. Be on the lookout for new brands, pricing strategies, promotions they’re running, new advertising and significant wins or failures.
Watching and analyzing the choices your competitors make will help you determine your own path. Staying on top of your competitors’ marketing activities can help you identify new trends and customer needs.