It is common for a business owner to get defensive when asked “who is your biggest competitor?” They tend to believe that if they never mention their competitors then it is like they don’t exist… REALITY CHECK, knowing your competition is the best knowledge any Marketer can have!
Business owners do not always understand how critically important it is to know the ins and outs of their three biggest competitors. I am always asking my clients the following about their competition:
1. Name your top 3 competitors locally, and your top 3 competitors on a regional or national scale.
2. Why each is considered competition to your company?
3. What are these companies doing that your business is not doing?
4. What are you doing that is similar to these companies?
5. What are you doing that is different from these companies?
Understanding the five points above will show holes in the market place, provide a picture of opportunity/lack of, or prove that the market is saturated resulting in the business owner making some changes to their model.
Unfortunately, I have seen companies that spend years working toward building their business and dipping into savings to finance the project, only to then find out that their business model is extremely similar to many other operating businesses in their desired area. Researching your competition and determining if you are correctly positioning your company is one of the first steps one should take before investing any money. In the long run, this could make or break your business!
Can you relate to the common mistake of ignoring competition? Or maybe you have seen companies who do not think competitive analysis is important and it backfires on their business. LET’S TALK ABOUT IT!