It is important to understand who your key competitors are and what they offer to customers. Of all the individuals or businesses that could possibly use your products or services, only some will choose you over your competition. It is unrealistic to assume you could appeal to everyone; each customer has a unique situation and motivation for purchase. Each customer will seek a solution to a problem that you could solve, but what that customer is looking for may lead them to you…or to your competition.
Analyze the Competition
A competitive analysis is a systematic way of looking at the needs of the customers in your industry, and the options available to them. To conduct this analysis, you need information about your competitors and about your potential customers. The best place to get this information is from your current customers or prospects. Although they can’t tell you everything, they can tell you how you and the competition are perceived in the market, and what unique advantages you and your competition possess.
Other ways to gather information about your customers and the options they have:
- Go to trade shows and listen
- Do a survey of end consumers
- Pull information about your competitors from their facebook fan pages and website
- Read articles published about your industry
As you gather information from surveys, conversations, and searches, look for ways to group the customers’ needs and the ways that those needs can be met. These are the segments of your industry. Which competitors best match which segment? And is there a segment that is a good match for your strengths? Is there a segment where your organization can dominate? Which customer needs is your organization meeting in stronger, better, or different ways than the competition?
You know how to do this
Do you know as much about your competition as you do about your college rival football team? Do you study it as hard? Talk to as many people about them? Search them out in articles and websites? If so, you probably have a lot of competitive information to analyze. If not, well, maybe it’s time to start.