Keep your friends close and your enemies closer. So the saying goes. Reading Jeff Haden’s article on competitive analyses for Inc., I was struck at just how important this is in business. Replace “enemies” with “competitors” and you’ve got a new mantra.
I call making the T-shirts.
Keep competitors closer
Seriously though, Haden explains that if you expect to maintain and grow your company, you must understand the strengths and weaknesses of your present and future competitors. I would add that past competitors, or companies who have failed in your market are worth studying, too.
The goal is to analyze how your competitors perform and how you compare to them. In other words, why would your target market choose you over the other guy? It could be that you are specifically tailored to fit their needs. It could be you have the friendliest staff. It could be you have a better relationship with the local newspaper and therefore get better ad placement.
These things matter. In order to serve your audience, beat out the competition and carve out your own market share you need to know your competitors, and by extension, your market. Haden’s article has a wonderful list of questions to ask yourself. Remember, sober judgment is key. This analysis is not to pat yourself on the back.
To answer these questions, it comes down to diligence. Questions like “what is my competitor’s basic objective?” or “how can I take market share away from their business?” are easy to answer if you follow your competitors on social media, peruse their website quarterly, look for their ads in the paper and periodically Google them. Sounds a bit like stalking, I’ll admit. The knowledge you gain is worth it.
It also takes diligent reflection on the state of your market. This will help you assess how likely you are to face future competition. Ask yourself questions like “who isn’t being served by me and my competitors?” and “if my competitor drops out of the market, what will I do?” It also gives you the space to think “if I face new competition, what will I do?”
This is where knowing yourself comes in. Seeing how you differ from your competition, where they fail and how you rise above them, presents you with your competitive edge.
Keep your company’s character closest
In my opinion, the best competitive edge is character. Whitney Wolfe, the founder of dating app Bumble, said in an interview with NPR that she’s not worried about competition. Bold words from the founder of a dating app in a sea of dating sites. The reason she’s not worried is summed up in two words: authenticity and purpose. She knows first hand what her competitors’ weaknesses are and she knows who she’s serving. She knows her company’s character.
Maybe your company’s competitive edge is encouraging gender balance, like Bumble. Maybe it’s your drive to create a better customer experience and your awesome return policy. Maybe it’s your commitment to transparency and your timely, thoughtful responses to customers’ comments on social media.
Whatever it is, your company’s character is based in your why and your how. I’ve already asserted in an earlier post that you have to have a reason to be doing what you’re doing. Goodness knows, there are enough reasons not to do this, yet you persevere. That’s the why. Your company’s character is also based in how you’re achieving your mission. It’s applying your competitor analysis to set yourself apart.
You’ve got to do your due diligence. Period. But you don’t have to fear your competitors. If you’re confident in your company’s character, you can be confident in pursuing your market share.