Researching Your Competition in 5 Steps
Analysing Your Competition Can Deliver a Powerful Competitive Advantage to Your Business.
Whether you’re a brand-new business just starting out, or an established company with an existing client base, it is important to have a good understanding of your competitors. Competitor research can help you to protect yourself from threats in the marketplace and ensure you are always pushing your business to offer the best service or product it can.
Luckily, it isn’t hard to gain a good understanding of your competitors—even for small businesses without big budgets and dedicated teams. Here is how to perform competitor research for your business.
Define What Makes a Business Your Competitor
First, you’ll need to define what makes a business your competition. Most businesses have several competitors ranging from those offering a similar product at a similar price point, to those competing in the same market with different products.
For example, a taco restaurant’s main competitors will be other taco restaurants in the area. However, it will also be competing with restaurants that sell different types of food. Additionally, many people eat out to meet friends or go on dates. This means the taco restaurant is essentially competing with anywhere that people do these activities.
If you’re a small business, you may not have the resources to research every competing business. If this is the case, your best bet may be to research your closest competitors. These will likely be businesses that offer a similar product to you, targeted at similar buyer personas, and that cost a similar amount.
Decide What You Want Your Competitor Research to Deliver
There are plenty of things small businesses can use competitor research to discover. What you need to know depends on your business plan. For example, how your competitor’s website performs might not be important for a company that plans to do most of its sales via telemarketing.
You could use competitor research to show:
- Quality of the product, price, customer service, and other details related to customer experience.
- The marketing strategies the business uses, and how effective they are. Also, the areas and regions they operate in.
- How aware customers are of competing brands, and what they like and dislike about them.
- What is powering the business? For example, are they making use of new technology, how much do they pay employees?
Once you have this information, you can evaluate your competitor’s strengths and weakness in comparison to your business. This will give you an idea about where you can improve, as well as reveal your competitive advantages.
Perform Competitor Research on Specific Businesses
Your next step is to begin the actual research. Luckily, there are lots of ways that small businesses can research their competitors without breaking the bank. Here are some examples of how to research your competition:
- Check out review websites like Trustpilot and Trip Advisor to see what customers like or dislike about a competitor.
- Research competitor social media pages such as Facebook, LinkedIn, and Twitter. This can show you how the company interacts with customers and what it is doing to promote its business. It could also provide insight into what types of social media sites work for businesses in your industry.
- Set up Google Alerts about your competitors to be alerted every time they are mentioned online.
- Visit your competitors business in person to analyse the customer experience.
- Ask customers that use both services or that have switched to your service what they like and dislike about your competitors.
- Use online tools like SimilarWeb (to research details about web traffic), SpyFu (to see which keywords competitors are buying on Google Ads), and BuzzSumo to see how your competitor’s content performs.
Stay Up-To-Date On Industry Trends
As well as researching specific competitors, it can be a good idea to stay up-to-date with more broad industry trends. For example, if new technology emerges that enables you to provide a faster service, implementing it first may give you an advantage over competitors.
Keeping up with trends shouldn’t be hard. Most industries have both on and offline publications that detail what is happening in the area. Additionally, you could attend trade fairs, conferences, or webinars as part of your competitor research and to help stay ahead of the curve.
Put Your Research into Action
The final step is to put all you have learned about your competitors into action. Did you discover something they are doing much better than you? Then how can you improve your offering so you can get on their level? Alternatively, if you know you’re doing something better, how can you exploit the gap between you and your competitor to make your business a success.
You can be selective about what you act on, however. For example, a boutique fashion store may notice that its competitors sell clothes cheaper. Instead of looking to lower prices, the store could attempt to improve its branding or hire knowledgeable staff who can provide a better shopping experience.