There are many requirements for running a successful business. One often overlooked task involves your competition. A competitive market analysis can generate revenue, reduce expenses and improve your profitability.
I spoke with Carol Shaugnessy, president of SCORE Southern Arizona, and learned the following:
• It is imperative to have an open mind. Go into it understanding we can all learn something.
• Start with a few of your biggest competitors and examine everything you can.
What products and services do they provide? Which target markets do they serve, and what marketing channels are they using? Can you identify good niche markets they may have overlooked? What did they do differently last year? Did they offer a new product or service or find a new industry to serve? How does your pricing compare to theirs?
Which online review sites are they using, and how are they getting those online reviews? How does your website compare to theirs? What can you learn from your competitors’ systems and processes? Are they using new technologies to increase productivity?
• Ultimately, you want to adopt a few things they are doing really well and incorporate that into your business. Also look for their areas of weakness which might allow you a competitive advantage.
• Staying in touch with your competition can create great opportunities, as well. Maybe you can refer overflow business to each other, or team up on a large project.
Imagine you found out one of your competitors is going out of business. Would they sell you their business assets for a good deal? Consider buying their customer list, phone number and website at a discount, too. If you are looking to hire more people, could you hire their best talent? Get creative and think outside the box.
For more information and free advice on the tools to use for a competitive market analysis, call your local SCORE office at 505-3636.
