Let’s face it, no matter how small your niche business is, you are bound to have some type of competition somewhere. Studying your competition can help you gain valuable insight into your market, customer demographics, and advertising strategies. In order to get your business to the top or the food chain, you need to create and analyze solidly built competitive analysis reports, often.
Where to Begin
There are a number of ways you can begin studying your competition. Be creative in your search and always keep an open mind when researching certain companies that you feel may be out of your league. The key here is to analyze both new and established business, successful business, and businesses that may have made catastrophic mistakes.
If you are a website developer, investigate local competition to help you gain insight on your local market. But you also need to research the big fish such as Google, Yahoo!, and Bing. If you’re a mechanic remember to research large dealerships and to document their advertising activities, service specials, and shop set up.
Talking to Their Customers
One of the best ways to learn your competitors customer retention policies is to speak directly with their customers. Begin by obtaining a list of consumers that are likely to buy yours or your competitors products. Make inquiries to find out why they shop where they do, how they feel about the prices they are paying, and what would prompt them to make the switch to your company.
Scope Out Ads and Websites
Much of a companys marketing strategy can be learned by simply visiting their website or physical location. Try to think like the customer to determine what on their site or at their location may be compelling individuals to spend their hard earned cash. Visiting a physical location can provide you with a customer type, such as who is shopping there most and what are their main purchases. This can help you determine what portions of their marketing campaign are working the best.
Tap into Your Inner Sherlock
In order to obtain the most accurate information regarding your competition, you must become a customer yourself. By going through the entire buying process with your competitor, you can learn how they attempt to appeal to customers, gain insight into the customer service experience, and find out what makes their sales team tick.
Companies that may have recently gone out of business should not be ignored on your quest for competitor insight. By researching data pertaining to these dead companies, you may find similarities in your own business plan. If so, you can make changes accordingly to help you avoid their unfortunate fate.
If you do some legwork, you can get the inside track on your competition. Even researching companies that are technically out of your league can help you push your business performance to the max. While researching, be sure to go back to past reports and document any changes that were made by these companies and determine whether these changes may have improved their position or caused loss. The important thing to remember is that you can learn from most actions that your competitor caries out.
Image via Gregory Wake