You need to know how to compare the competition if you want to win over the customer. The way a customer reacts, will show you how to do things right.
Whether your target market is just local, or you want to market to the world, you need to identify your leading competitors. Do things similar to what they do right and find alternatives to what they do wrong.
With that said, nothing’s more important than knowing your potential customer. This is where you need to really focus. You have to know what they are needing out of an interaction with your business. If you can’t satisfy the needs of your customer, then there’s no point in knowing how to compare the competition.
How To Compare The Competition
When we want to gain market share, we often look for answers outside of our own business. While it isn’t everything, we definitely should be aware of our market surroundings.
Here at ProfitVsWage, the bulk of our readers range from wanting to find a way to get free from employment, to the new entrepreneur wanting to improve or streamline their business. This is who we direct our information toward. We have LOTS of competitors! While we don’t put much of our time into following our competition, it’s good to be somewhat aware of how they provide information to the customer.
For instance, check out some of the things we might want to know about the competition.
“Gather Intel”
Are they innovators? Are they coming up with new and interesting ways of delivering the product or service? Sometimes seeing what others are doing can spark our own imagination to innovate. (Don’t confuse this with being a copy-cat.)- Have they made any mistakes? It’s great to be able to take a lesson from someone else’s mistakes.
- Did they try to grow to fast? If so what did that cost them? Did it reduce the quality of the customer experience?
- Did they take on too much debt? A heavy debt load and/or a lack of funding, starts you out “with one foot in the grave”.
- Was there a lack of marketing/hype? If nobody knows about you, you’re just wasting time and money. You can have the best product, but if you have no customers, what’s the point?
- Hired the wrong people to interact with customers. Nothing matters more than the way you make your customer feel. An experienced customer who is happy, is a great marketing tool.
- Do they do business in a way that would compliment your business? Competitors may have a unique niche way of providing a service that they are great at. For you to implement that into your business may be expensive and/or time intensive. Perhaps joining forces would be beneficial to both companies??? A bigger team, often times can move forward at a much faster pace.
- What’s their pricing for similar products/service? In other business ventures, I don’t mind being at a higher price-point. I just make sure I am worth it and provide the best customer experience.
Are they innovators? Are they coming up with new and interesting ways of delivering the product or service? Sometimes seeing what others are doing can spark our own imagination to innovate. (Don’t confuse this with being a copy-cat.)“Gather More Intel”
- What’s their distribution model? Can you do it in a more preferred way for the customer?
- How are they with customer follow-up? In most cases, you’ll retain your customers if you make them know that “you care that they are happy”. This follow-up also keeps you in their mind, possibly leading to more purchases and them providing “word-of-mouth-marketing” for your business.
- Is their logo and branding more appealing? This is very important. Your brand/logo has to evoke confidence and be more enticing, so you get looked at first. If the customer comes to me first, then they will have experienced the best. So either they buy now, or they’ll be back after comparison shopping.
- Are they using all that technology provides? How do they use their website (or do they even have one)? Are they on all types of social media and post frequently?
- Why do their costumers go to them? Is it location, customer service, informative website, etc.? Know why and create a better reason for them to use you instead.
How To Gather The Info
Now we know some of “what” we want to learn about the competition. But how do we go about gathering it? This of course depends on the type of business and if it’s local, multiple locations, or web-based. We all have creative minds and will find a way, if the desire is high enough, but here are some ideas.
| Web Based | Location Based |
|---|---|
| Navigate their website. Notice it's look and feel. | Visit the location and become a customer. Buy something. |
| Is it easy to find a solution to the customer's problem? | Notice the ease of getting to the location and navigating the store. |
| Is the site fast or slow? | Was the staff helpful and friendly? |
| If there is a phone number, call it and hear how helpful the rep is. | Talk to other customers to get their opinions of the business. |
| Order something. See how quick it comes and the quality. | DO NOT STEAL THEIR CUSTOMERS! Just gather information of what they like and dislike about the competition. |
| Contact them with a complaint, to see how receptive they would be to correcting the issue. | Do all website investigations as well |
Knowing how to compare the competition yourself is important in the early stages of building your business. As your business grows and becomes more profitable, there are services (good and bad), that can do the heavy lifting in this area.
Compiling Your Findings
Before you start gathering the intel, you need to make a spreadsheet. This way you’re compiling the same information from each competitor. Hopefully you can use some of the suggestions from above, however every business is different.
It would be impossible for me to provide a spreadsheet for each business model and industry. Even if I could, it would be best for you to create that list yourself, as nobody knows your unique business the way you do. Even as your business grows and you want to outsource this work. You still need to tell the service some of the detailed information that you need them to gather and consider. These unique details are likely what separates you from the competition.
Breaking It All Down
- Once you figured out what you want to know about the competition.
- After you figured out who are your top competitors.
- Then made a spreadsheet that has all the questions that need to be answered.
- Took the time to complete every spreadsheet for every one of the chosen competitors (online, on the phone, and in person).
Now it’s time to break it all down and evaluate the results. You’ll have put a lot of time and effort into this at this point. If you’re trying to build your business solo, I would suggest doing an evaluation of the results on your own first.
Considering each point on the worksheets, summarize your thoughts and findings. Each point (question) should be evaluated on it’s own piece of paper, word doc, or however you take notes, because they need to be considered separate from other points first.
Now that you have all your comparison results sheets, each of them should have ended with thoughts on how you can be better on every point
You’re Not Done Yet
So, if you have partners in your business, you all did this process together and came up with great new ways to put your business out front of the competition. But, if you’re going through this on your own, it’s time to bring in some trusted advisers for the next step.
Ultimately the final decisions are yours as a sole owner, but sometimes you would do yourself justice by inviting in some outside help. This is one of those times. Friends and family are not usually good for this task, so seek out people you know are capable of evaluating the information you’ve gathered.
You would be surprised at how willing successful people are willing to help new business owners. Remember that you’re gathering opinions (other perspectives) from people you feel could add a valuable insight to your business. If you’re worried about divulging too much info about your business, then talk to different people about different points.
Create a focus group of sorts. It’s like having a board of directors who all have different experiences and provide their opinion on how to make the best of your business. Get involved in some business meetup groups, and in different areas, to find the right advisers.
Nobody Said It Would Be Easy
How to compare the competition in a way that betters your business is going to take significant time if you want it to be worth the effort. Doing this the first time is by far, going to be the most time consuming. This is going to guide you to providing the very best experience to your customers.
Think of it this way, if someone comes to your business and then leaves to continue shopping around or do research, how confident are you that they’ll come back to you?
Very Intimidating!
In the beginning, as you look at the success of your competition, it can be VERY INTIMIDATING!
I know for me working on this very website, my competition (and there is a lot of it), is quite intimidating. There truly is a lot of great information out there when it comes to entrepreneurship, investing, and personal finance. There’s also a lot of very bad information available. But you know what? There are several BILLION people absorbing this information!
I have more real life experience actually doing what I talk about, than many of the other sites out there. I also have a unique perspective and a unique way of expressing myself. Of those billions of web-surfers who are looking for information, a portion of them are going to relate to the way I communicate my unique perspective. They just have to find me.
Who Are You?
I promise you are unique. Let that shine through in your business. Don’t try to copy someone else. Nobody can be “you” as good as “you” 🙂
Knowing how to compare the competition, gives you insight into who they are and how you’re different than them. Use your findings to inspire better, or more efficient ways of doing things in your business.
