Using Market Competitors Knowledge
By Amol Gupta
There are many examples throughout history of individuals and organizations using adversaries' actions to their advantage. Whether it is war strategy or a sporting event with competitors studying previous game footage, it is clear that studying the habits of an opponent is advantageous to success. The same premise is true in the business world. By learning from competitors, business operators improve overall business performance and ultimately achieve a higher level of financial success.
The first step in learning from competitors is recognizing potential competition and assessing market impact. Competitors are classified as direct or indirect. Direct competitors operate in the same business market. Indirect competition refers to businesses operating within the same geographical area and having a financial impact on a business. However, indirect competitors do not operate in the same business niche. Of course, the Internet brought international businesses to every consumer's doorstep and expanded the idea of direct competition. Local and overseas businesses operating in the same business market are now considered direct competition.
Knowing the number of competitors in a market is only part of the information needed to make successful decisions. By analyzing products or services, marketing techniques, distribution methods, customer service guarantees, staffing procedures, and customer satisfaction, valuable insight is gained into the business market. Information exposes strengths and weakness in the company's strategy and market share.
There are numerous methods of acquiring competitor information. Company websites are excellent sources for understanding market share and becoming knowledgeable about a company. Additionally, local business organizations provide a wealth of information regarding business standing in the community and overall financial stability. The information indicates the emphasis a business places on customer satisfaction and how much the business may be able to discount items before a detrimental loss occurs.
One of the easiest methods of acquiring information is developing a business relationship with a competitor. Additionally, it is desirable to have a friendly relationship with competitors as it may be beneficial to work collaboratively on an idea at some point in time. Remember to talk with customers, and use customer satisfaction as a tool to discover areas of improvement. Additionally, suppliers in a business market are able to provide information through casual everyday conversation. Information provided might seem inconsequential at the time. However, in reality, it may divulge significant business strategies affecting market share.
Analyze data for weaknesses in a competitor's strategy. Are there areas where a new product or service is needed but not offered? Which strategies, values, and services have worked for competitors and which have failed? Are competitors gaining a larger market share because their services are superior? If so, use the information as means to realign ideas and update methods to improve business success.
In order to become successful and maintain a market share, business operators must be aware of market history and competing businesses. By carefully analyzing product information, marketing strategies, distribution methods, and employment data, operators can learn from business competitors and use that knowledge to improve market share and business success.
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