Building a successful business involves looking inwards to develop the kind of irresistible offering that becomes a household name, but that is not the only aspect involved. You also need to study the competition. Only by studying the competition can you truly refine your approach and product and ensure what you are selling is truly unique. Here are 5 tips that should help you develop a competitive analysis:
1. Find Out Who You’re Up Against
Before building a competitive analysis, you must first figure out which companies count as the competition. You are looking for companies who are not just targeting the same market you are, but have an offering similar to yours. Just because a company is selling to your target market does not mean they are competition. Similarly, just because a company is selling a similar product does not mean they are competing with you.
2. Do Your Research
Once you make a list of your primary competition, it is time to do your research. The more information you can gather, the more informed your decisions will be. That seems obvious, but many companies have been laid low by ignoring the value of an intelligently made choice.
There are numerous data points to research. First, you will want to find out everything you can about their product and compare them to yours. Check on the quality, as well as what feature differences there are. You should also take a look at their pricing structures, if their products have tiers, as well as their policies on discounts and returns. Additionally, you should study their branding and how they position their product to the market.
3. Study the Competition
No company is perfect. Some many have more capital and influence than others, but every company has strengths, as well as weaknesses. Use your information to figure out where the competition is impenetrable, and where there are vulnerable.
Consider every angle. Is their pricing a little high for their brand positioning or target market? Do they have a weak team at the helm? Is there a feature or option the market wants that the competition does not offer? Find those weaknesses, and you will find your angle of attack, a way to make your offering more appealing and more competitive.
4. Consider Your Unique Selling Proposition
Planning around the competition is only the beginning. To truly complete your competitive analysis, you also have to look inward. You need to fully actualize your unique selling proposition. Your USP is what makes your product special, independent of the competition. It should be something that cannot be copied by your competition, at least not easily. Your advantage could be a manufacturing deal that allows you to produce products at a low price other companies cannot match without going into the red. It could be a key feature that you have patented. Whatever it is, you need to use it to the fullest.
5. Speak with the Competition
If you want to learn more about the competition, often the best move is to just talk to them. While you are inherently fighting for the same market, the fact is collaboration could benefit both sides, despite that fact. Collaboration is not uncommon and will happen to serve the fringes of your respective markets, the parts of the audience that you are not fighting over. However, that collaboration can only happen if you are on good terms with the other entity.
Reach out to the competition. At best, you may find a friendly rival. At worst, nothing happens and you may end up learning information you would have missed otherwise.
Forming a competitive analysis to help your startup or company plan its strategy can be difficult, but it’s necessary.
Without the right information, you will never truly be sure of your actions, and they will never truly be informed. Make the effort and make it easier to choose the winning move. And if you need help, give us a shout and we would be happy to assist you.