Most entrepreneurs have spent at least some time evaluating the competition. It’s hard to start a business without a business plan, and no business plan is complete without a section on identifying and describing the top competitors in the given industry.
However, after the business is started, many business owners stop thinking so much about the competition and instead focus their energy on making the business as good as it can be.
Focusing on your own business isn’t necessarily a bad thing, but if you want to reach your maximum potential and prevent one of your competitors from ultimately spelling your doom, it’s important to make sure your business strategy is created with an understanding of who your competitors are and how they operate.
To do that, you’re going to need to keep a closer eye on your competitors. So how can you do it?
The Value of Competitive Intelligence
Competitive intelligence isn’t just about spying on competitors because you’re interested in what they’re doing or because you’re the equivalent of a nosy neighbor. Getting more information about your top competitors can help you in a variety of different ways:
· Unique differentiation. If you want your business to stand out and appeal to your shared target market, you’re going to need to find some way to uniquely differentiate yourself. In other words, your business needs to have something that your competitors don’t have. The only way to figure out what your competitors have is to study them.
· Product development. Competitor research is also useful for product development. If you’re looking for new ideas, you might be able to get some. If you’re developing something in secret, you can watch to make sure your competitors don’t come up with something similar.
· Identifying strengths and weaknesses. This is also a valuable opportunity to identify the key strengths and weaknesses of your competitors. As your competitors grow and evolve, you’ll be able to figure out what their unique advantages and disadvantages are. Once you do that, you’ll be in a much better position to strategically plan your business answer your customers.
· Sales and marketing improvements. Most people understand competitive research as a prerequisite for effective sales and marketing. This is true, though it’s only one reason you should be investing in competitive research. Better competitor knowledge can lead you to better sales pitches and better marketing messaging.
· Alerts and response potential. When your competitors come out with something new, such as a dynamic and innovative new product, you need to know about it. More consistent competitive research will allow you to get alerts when this happens and give you plenty of time to respond.
· New ideas. Researching competitors is also just a great way to come up with new ideas to improve the business and serve your customers better.
How to Keep a Closer Eye on Your Competitors
So how can you keep a closer eye on your competitors?
· Identify your biggest threats. If you want to research your competitors, you need to know who your competitors are. Depending on your industry, it may be relatively easy or difficult to find people who are doing business similar to yours. To start, you should have at least some idea of who your biggest two or three threats are. From there, it’s a good idea to keep a running list of any business that’s similar in structure or purpose to yours.
· Implement competitive research as an ongoing need. The biggest failure point for competitive research is after the initial analysis. Some entrepreneurs falsely believe that competitive research is something to be done once, at the beginning of the business, never to be touched again. But if you want to see the best benefits from competitive research, you need to treat it as an ongoing need.
· Unify your departments in competitive research. Don’t make it the responsibility of any single department to do competitive research. This is something that everyone in your organization should understand.
· Use the right competitive intelligence tools. Better competitive intelligence tools will make it faster, easier, and more straightforward to do all the research and analysis you need to do. Shop around to find the best package for the best price.
· Sign up for automatic alerts. Make sure you turn on automatic alerts, so you can know if one of your competitors launches a new product or goes through a major change.
With a closer eye on your competition and a better understanding of the overall business landscape, you should be in a much better position to run your business effectively. It’s going to take some significant changes to the core of your business, but the long-term benefits are more than worth the initial time and monetary costs.
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