In order to project your business towards long-term success, market relevance and boost your business, you need to build concrete business plans. One effective method that can give you good insights and ease your planning is conducting a competitive analysis.
In this article, you will discover the importance of competitor analysis.
Making assumptions is bad in business because often times, assumptions are wrong and they can take an awful turn on business. By conducting a thorough competitive analysis, what you will get is an accurate and factual data about your competitors, their products, services and market share.
Knowing your competitor weaknesses may instigate ideas for improvements of your service or product offerings and bring innovative ideas towards improvement. You will discover what they are doing wrong, how to avoid such and ways they can improve and use it to your advantage.
Knowing the main reasons why your loyal customers do business with you instead of your competition is an importance of competitive intelligence. Although you need to adjust your weaknesses but it is more important to focus on your business’s competitive advantage and apply it efficiently to win more customers.
If you want to improve your service and product offerings of your business, then you have to conduct competitive analysis regularly. This will indicate where your business needs improvement in terms of product or service performance, company policy or customer communication. For instance, if you are a service provider, you may discover that your service policies do not meet up with your competitors’ standards and customer anticipations. This may cause you to re-strategize and improve your service policies.
Competitive analysis will reveal if you are charging way below or above market for your services: you will discover if you are charging twice as much as your competitor and if this is the reason why your sales might have dropped or if your charge less, which may have resulted to low profits for the business. With information about competitor pricing, you will be able to make wise decisions in terms of your own pricing.
The market is usually excited about new features and latest trends; these attract even potential customers and prevent the loyal ones from leaving. By learning about other business in your niche, you get to discover the latest trends and see if you can incorporate it into your products and services innovatively.
Ideas can never run out when you commit to constant learning. This is one of the benefits of competitive intelligence. You will get to discover so many untapped opportunities and focus more on solving customers unmet needs in an efficient manner.
For instance, there are some industries that conduct black Friday yearly and this has given them a competitive edge over other companies in their industry. By researching about your competitors, you get the chance to learn more about how the market place runs and customers spending culture and season.