10 Ways to Better Understand Your Competitors

Competition is inevitable because of the presence of similar businesses in the marketplace. It is a prerequisite for a healthy economy because monopolies can create problems for customers. Competition increases diversity, keeps businesses motivated to perform better and helps restrict prices from going too high. Businesses continue to innovate and meet the needs of their customers because they are afraid of customer churning due to the tempting offerings of competitors. It has thus become necessary for brands to earn the loyalty of their buyers to increase retention.

However, businesses should know their competitors in order to outperform them. They must be aware of their products, unique value proposition, service quality, market share, sales volume, strengths, weaknesses, marketing strategies, core competencies, and growth prospects. This helps them evaluate and stay ahead of them. Here is a list of ten ways to better understand your competitors. It can help entrepreneurs devise strategies to develop a competitive advantage.

1. Gather Data Through Research

Market research has always been the most important tool in the arsenal of business owners for understanding the market forces, target audience and competitors. It helps to identify the number of direct (similar products), indirect (different products for the same purpose), legacy (long-established competitors) and emerging (start-ups in the same category) competitors. New entrepreneurs who purchase a business for sale Brisbane must track competitors’ activities and financial standing continuously to determine how they are performing. It allows them to create a space in the clutter and make their business stand out in the crowd through effective brand building and positioning.

2. Analyse Competitor’s Products

When entrepreneurs make efforts to understand competitors, they must begin with the products. They must assess how competitors’ products and services are better than their offerings and how they satisfy customers. They must check all the features, specifications, sizes, variants, models, colours, packaging, handling, distribution channels and availability. It is vital to understand the positioning of the competitor’s products in the market and how they are priced to attract an audience. All this data helps entrepreneurs to make improvements to their products to outshine competitors.

3. Check Competitor’s Online Presence

Tracking competitors’ online presence is vital for understanding their online visibility, brand mentions across channels and social media presence. It helps to determine customer engagement through digital marketing and online advertising. Budding entrepreneurs who wish to buy a Brisbane business for sale must identify their competitors’ reach, website traffic, conversion rates and number of social media followers. It helps them evaluate social interactions and the success of campaigns. Since online visibility is of utmost importance in the current scenario, analysing this aspect helps to build a better digital marketing and engagement strategy.

4. Speak to Competitor’s Customers

Customers who purchase competitors products must be interviewed and asked for feedback to understand their sentiments. They can help provide valuable insights about brand perceptions and features that make them opt for these products. If the customers have switched to another brand recently, they can be asked to complete a survey to understand the reasons behind this move. Customer feedback can also be used to analyse where the business is faltering. It can help entrepreneurs identify gaps in the market that can be filled to acquire new customers.

5. Conduct Competitor’s SWOT Analysis

Conducting a SWOT (strengths, weaknesses, opportunities and threats) analysis of competitors is a significant way of understanding them. It gives a clear idea of the strengths that make them a powerful contender in the marketplace. It also provides an insight into the weaknesses that make them vulnerable to customer churning. In addition, it helps to identify opportunities, which are the areas that have not yet been targeted by the competitor and can be captured easily. It also gives a peek into the threats that can impact the business negatively, such as technological advancements, supply chain disruptions and inflation. The threat analysis allows business owners to prevent problems by preparing for them in advance and using the opportunities to move forward.

6. Understand Competitor’s Differentiators

Competitors have unique value propositions that make them attract attention and build a reputation. Businesses need to understand these differentiators, such as brand positioning, image perception, customer service, online reputation management, pricing category, packaging, styling, colours, logos, images, content marketing, and advertising. Differentiators help customers identify the brand in a pool of similar products and easily identify the characteristics that make it better than others.

7. Evaluate Competitor’s Marketing Strategy

The way the business is marketed can help in customer acquisition and retention. A solid marketing strategy combines different formats and platforms to inform, educate, and engage with customers. Entrepreneurs who purchase businesses for sale in Brisbane must identify the channels and campaign types preferred by the target audience and used by successful competitors to promote their products. It helps to reach the audience and showcase a comparative presence. However, it is vital to avoid copying competitors' styles and content and focus on building a stunning image that forges long-term relationships and increases conversions.

8. Check Competitor’s Sales Volume

Business owners must check competitors’ sales volume by checking the industry reports and using analytical tools to check their website traffic. Entrepreneurs can also visit their websites to understand their financial standing and revenue growth over the years. Attending industry events and reading online research material can help identify the market share obtained by competitors and how it is increasing. It helps entrepreneurs to identify untapped markets and industry leaders and their tactics to stay on top.

9. Know Your Competitor’s Tech Capabilities

Technology has become an important part of business operations, and every innovation is related to it. Thus, it has become vital for businesses to adopt the latest tech trends to stay ahead of competitors. They must keep tracking competitors to understand their tech capabilities and how they are utilising them to create better products. Checking in on competitors helps to identify the latest tech that should not be ignored.

10. Identify Competitor’s Pricing Plan

Pricing of the products is a tricky process. Business owners must identify how competitors have priced their products and what is their return on investment. They must ask their accountant to forecast the cost of goods sold and the income generated by competitors. It can help them gauge how to price the products to maintain a competitive edge without incurring losses and generating profits. Many driven individuals who buy a business for sale in Brisbane to grow quickly increase prices to increase profits. However, it can make customers switch to competitors. Thus, it is vital to understand competitor’s prices before deciding the sales price.

Wrapping Up

Understanding competition is a vital part of business operations because competitors can take away existing customers at any moment. A single, smart move by a competitor can impact sales and revenue. Thus, businesses should follow the steps above to keep tabs on their counterparts.