Featured image by Gerd Altmann from Pixabay
Starting a small business can be nothing short of terrifying, particularly if you start comparing yourself to all your competitors in the same field. However, in order for your business to thrive you need to know almost as much about the competition as you do your own company and customers. The trick is to not let your competitors intimidate you, but use them to drive you forward.
It’s a great idea to carry out an in-depth competitor analysis of anyone else trading in your niche that you consider to be competition. Analyzing the competition will allow you to identify their strengths and weaknesses. It will help you to spot gaps in the market and thereby understand what products or services you should offer and how you could market them effectively.
One of the biggest questions any new business owner asks is usually “Where on earth do I start?”
And the answer to this is that the best place to start is with a plan and strategy. Getting distracted from your business because of competitors is a big mistake. Spending too much time dwelling on their successes and your shortcomings is counterproductive. Instead, spend your time carrying out an in-depth analysis. Then repeat the process every month.
Identify Your Competitors
All businesses face competition. Even if you’re the only bar in town, you will still be competing with the local cinema, restaurants, and other leisure facilities where people spend their money and free time. Use local directories and listings to get a good idea of what’s already available in your area.
Establishing your digital competition is as easy as entering a search into Google and making a note of the top ten search results. You can repeat this process as many times as you wish, using as many of your key search terms as possible. There will be some very big names within these search returns, but don’t let them intimidate you. Simply speaking, the Internet offers a level playing field.
Analyze Your Competition’s Strengths and Weaknesses
The main goal of a competitor analysis should always be to strengthen your own marketing strategy and plans, not just so you can feel good (or bad) about yourself! Be prepared to put into action anything you uncover as a result of the analysis.
A SWOT is an analysis of a company’s operations, assets, and performance. This will give you unique insights into your competitors. Especially, it will illustrate what you need to do to stay ahead of the game.
Review Your Current Position
Comparing your business alongside your competitors is essential to developing the most effective presence for your business, whether that’s in a brick-and-mortar store or on the web.
A full review of your business’s current position, in terms of marketing activity, in the following areas is recommended:
- Product: What you are selling
- Place: Where you’re selling your product
- Price: Your pricing policy
- Promotion: Any promotional activity you are carrying out
- People: Training, recruitment, quality
- Process: Procedures in place to ensure consistency