If you are like many entrepreneurs, you think that your prices, your sales levels, and your market share are dictated by your customers. In reality, it is your competition that determines those things. By studying your competitors in the industry, you will identify changes that you need to make in order to give your business a boost over the competitors and become a leader in the marketplace.
What’s the Competition Doing?
Since your competitors are the number one factor in your sales, market share, and even the prices you set for your products and services, then it is important that you take the time to study them in order to gain an advantage.
Do not look down on your competitors. Your job is not to pick them apart to find fault or to be critical. The most successful entrepreneurs are those who can respect the competition and who study and learn from them. When you understand what it is that they do well, then you gain clarity into what you should be doing with your own business to be a solid competitor for them.
What tactics are they using to penetrate and dominate the market? How are they positioning their services and products? What keeps their customers coming back to them? How do they price their goods? How are their customers being serviced? How do they approach quality control?
How Does Your Business Measure Up?
Once you have answered these questions about your competitors and have a good understanding of how they work and why they’re successful, then it is time to have a close look at your own company. What is your area of excellence, or the thing you do better than your competition? What is your unique selling proposition (USP) that only you offer as a benefit to your customers? How do you position your goods in the marketplace to get the most out of your area of excellence and USP? How will you set your prices based on your competitor’s pricing practices? What are your sales and marketing strategies going to be?
As you are studying your competitors, don’t limit your scope to only those people or businesses that are within the same industry. You may be surprised to find that you share common targets with another industry. For example, cruise companies and land-based vacation companies are both competing for the same customers, even if they are in different industries.
Having clarity when it comes to your competitors is valuable in that you become aware of how important it is to research your competition, the need to create a plan from that research, and to commit yourself to carrying out that plan in order to be successful. This will help you go far in achieving your goals in business and your career.