Five Things You Need to Know About Your Competitors
To maximise our chances of winning new business, when our customers are faced with a choice, we must constantly strive to be aware of the rules of competition in our chosen segments and turn these rules to our advantage.
1. Why do they even exist?
Do our competitors exist simply because we don’t have enough capacity to serve the whole market or do they bring something to the market which we can’t bring in quite the same way? We need to make sure that any comparisons we make with our competitors are relevant in the eyes of our target audience.
2. Where do they add ‘ will-pay-for’ value for customers?
Assuming that we now understand the reasons each of our real competitors exists, are we clear to just what it is that makes them the choice for at least some of our potential customers? Is it their quality? Price? Overall perception of value for money? Our competitors may target a different market segment than us, for example they may specialise in economy whilst we specialise in quality.
3. Which of my customers are of most interest to them?
Competitors will certainly only be interested in some of our best customers that can generate the biggest margins. We should look at our customer base and establish which customers would be loyal to us and how we can encourage more customers to be loyal to us and as a result of this, create competitive strategies that focus on retaining our best, most profitable customers.
4. What is their cost base and liquidity?
How do our competitors make their money and profits? Is it the same way that we make ours? If it’s not, we must bear this in mind when comparing ourselves with them in order to keep a clear focus on the competitive environment.
5. Are they less exposed with their suppliers than we are?
Some theories of competition now suggest that competition is really about our supply chain versus their supply chain. If a competitor has a more reliable and cost efficient supply chain than we do, they are likely to outperform us in the long-term race for the customer’s mind and money.
If you would like any assistance with competitive research, please contact us at: info@vickykenrick.co.uk
