We all know that part of a good business survival plan is a well-researched competitive analysis. Before you start a business, investigating your competition, their products, prices, marketing and public relations plans, customer service, and more is paramount.
For many businesses, once the original competitive analysis is completed, the demands of creating and running a business take over and the time to stop to take notice of what your competitors (who may also be friends and colleagues) are doing and how the competition has grown changed can be overlooked. In the wine industry, the number of tasting rooms has grown exponentially throughout the US and Canada over the last few years and shows no signs of slowing down. This uptick in the number of competitors is going to affect your business.
Dig out your original marketing plan and look at the competitive analysis. If you don’t have a competitive analysis, now is a good time to start. Discover what your competitors are doing in the areas of:
- Products (What are they making, how well and how much?)
- Pricing (How much do the products cost?)
- Sales (How are sales made: directly, through distributors, via the internet, etc.?)
- Customer Service (How well do they treat their customers?)
- Promotion/Advertising (How are they promoting their products? Explore all avenues.)
- Strengths & Weaknesses (What are they doing well and what could they improve on?)
Start with the competitive businesses that are most like your own. Then branch out to similar businesses with the same target audience that may be making/selling different products in the same industry) or be in different price categories. Once you have the information delve into how successful they are, the number of customers you estimate they have and how your business compares. Try to put subjectivity to one side, for example thinking your product is better when it may just be somewhat different. Whether your product is better or not is for customers to decide. Remember that customer service makes a big difference in how customers perceive products.
Finally, take the time to visit your competitors. Much can be learned from going in as a customer. Or if you are well known to your competition send someone else in to do the assessment.
Knowing how well your competitors are doing is crucial to a successful business.
A tip of the glass from me to you!