Let’s face it, it can be a bit of a battle out there in whatever market you operate. But it is amazing how many businesses carry on without stopping to pause and review what their competition is doing.
The UK’s big four supermarkets are all a great example of this. So focussed on outdoing each other on pricing and introducing a broad range of services such as insurance, banking and video streaming, that it could be said they completely ignored the threat of Aldi and Lidl, dismissing them as ‘discounters’. But have you been in either store? The product range is good, the quality is excellent and the weekly special offers are fantastic. Leaf blower or running gear anyone? Aldi and Lidl are not really discounters after all but supermarkets with excellent value pricing who understand their customers and have an excellent operating model.
So, not knowing your competition can lead to products and services being disadvantaged, uncompetitive and ultimately being killed off as customers vote with their feet and hard earned cash.
So what can be done to raise your knowledge and understanding of the competition? Here are the six key things we recommend you look at.
1. Who are they?
You probably know who your regular competition is, so of course include them but what about newcomers to the market or businesses who have changed their focus or offering? It is really important to understand them too as they can be the threat in the future. For example did record and book shops really understand what Amazon’s potential was?
2. Who do they cater for?
Understanding their target audience is as important as knowing your own. It will impact who they target in their communications, what they say and how they frame their offer. For example, there are a plethora of personal alarm type products available on the market to support people living alone who might be at risk of ill health. But they speak to a range of audiences – some target the end user while others target the family of the end user and this makes a real difference to their communications, media and so on.
3. What are they offering?
It is easy to become complacent about your own offer and soon be overtaken by the competition. And it might not be the complete offer that needs an overhaul, just an element that really enhances the customer experience. Learning from the competition can help improve your offer with just a simple ‘tweak’. Or it can inspire you to really innovate and take the market to the next level.
4. What are they saying?
Learning from others can help you to maximise the impact of your communications, develop a new strategy to make sure your voice is heard in a new way or indeed cut out some channels that might not be working. Tying this in to the audience is also important – again looking at the alarms, a recommender strategy with a local press advert might be best for the end user but a social media and radio campaign might be better for speaking to their family as an influencer.
5. Where are they operating?
Just because a company is national or international doesn’t make it better. In their haste to take their offer overseas many companies lose their domestic market focus resulting in problems on the home front. Think about Mothercare for example – doing well overseas but struggling in the UK as other competition has undermined their position of expertise and complete product offering.
6. How much?
Of course price is a key consideration too but should not drive a knee jerk response if you find your brand is significantly more costly than the competition. Price can be about value too so weighing this up alongside the features of your service or product is essential. Just take a look at Waitrose – probably the most expensive place to buy groceries but quietly growing market share as they have a unique product and service ethos that customers love.
Of course there is much more to be done to set your overall strategy straight – understanding the broader market context for example- but the competition is a great place to start. Sometimes it is a wake-up call but other times it can be the start of a whole new ambitious plan for a business.
So what are your favourite examples of brand competition? One of mine is how Samsung beat Sony in the area of smartphones – they took a long hard look at Sony’s business and recognised there were three key areas that they needed to address: design, quality and price. With this clear mission in mind all product development focussed on achieving superiority across all three dimensions – one or two alone would not have been enough.
If you would like to know more about understanding the competition I’d love to chat with you. Contact Ali Richards at email@example.com or on 07771-835719.