There are many reasons why you need to learn more about your competitors but my three favourites are to avoid their mistakes; to copy and build upon what they do right; and to know their weak points when quoting against or taking their customers off them.
Generally, benchmarking can be useful to find out about your competitors. Of course, benchmarking data does have its shortcomings.
For example: it might be difficult to determine ideal sample sizes or find an exact business match, so you will need to dig deeper to mine the valuable information you need.
Here are some easy ways to find out about your competitors:
Go “mystery shopping”
Despite the name, this extends far beyond retailing and can be done in any line of business. Visit your competitors or telephone them to see how they answer and deal with your enquiry. Check your prices by getting quotes, or maybe buy something. See how (and if) they follow up your enquiry, ask where you heard about them, or inadvisably recommend something unrelated to you. What sales techniques did they use? What options did they offer; was financing available; did they offer a discount or stand their ground? All of this is a goldmine of vital business intelligence.
Join the club
Join your competitor’s customer club, loyalty programme or sign-up to their on-line offerings or newsletter. I regularly receive newsletters and notifications from about 20 competitors, some of which are humdrum, but others are very useful. This way, you can see what the competition is offering their customers, get new ideas and see what they are doing to keep their customers interested. You can also avoid what looks boring, old-fashioned or has been tried many times before.
Research online
Websites now provide a wealth of information about our competitors we could have only dreamed about getting hold of ten years ago. Everything from pricing, pricing plans, offers, personnel, unique selling proposition, marketing, service lines and products, technical information—the list goes on. Try to look at their websites through the eyes of your customers or prospective customers and find what might attract them. Often it is best to keep things simple and “dumbed-down” in your approach, as we often fall into the trap of assuming our customers understand what we do and will read and absorb information that to us is interesting but not necessarily to them.
Ask around
Go to networking events, join a referral group, and speak to people you meet wherever that might be, whether sitting next to you on the plane or in the queue somewhere. Speak to your lawyer, your accountant, your suppliers, your local Chamber of Commerce, ex-colleagues, and staff who used to work for your competitors.
Join a trade association and attend their events—the possibilities are endless. Just ask “have you used John Smith & Co?” Find out why they use (or do not use) a competitor, what they like about them, what problems they have had, and what they have heard from others and their opinions on pricing.
Watch for marketing material and advertising
Keep an eye out for and collect competitors’ advertising and marketing materials. Is it effective, stuffed full of offers and calls to action, or just plain and dull? Do they emphasize their unique selling proposition, offer a cast-iron guarantee, support reasons to do business with them, emphasize price or value, and tell a good story of how they have gone beyond the call of duty? Who and what type of customers are they trying to attract? How are they getting people to their website, their Facebook or social media sites?
In today’s business climate of constant change, tough trading conditions and tough competition, knowing your competitors well and how they operate their businesses is essential to business survival and growth.
So take time out and draw up a plan to get it done. Gather information, collate it, plan your strategies, and determine who will do what and when, but above all, take ACTION!
Nick Roberts is a business advisor and accountant formerly of Hawkes Bay and now practising in Newport, Wales.
