Business Success Tip: Study Your Competition
Who is your competition?
Who determines the prices you charge? Your level of sales? Your market share? Many people answer, “my customers.” Others claim, “myself.” Certainly both are key determinants of your ultimate business success. But the primary determinant is neither. It is your competition in the marketplace. For this reason, it is essential to thoroughly research your competitors and know them as well as yourself.
A common mistake made by many entrepreneurs is to look down on the competition, find fault with them, criticise them and make light of them. The smart entrepreneur respects his successful competitors, studies them and learns from them. Investigate your competition. What are their strategies and tactics for market penetration and market domination? How do they position their products or services? Why do people buy from them? What is their pricing policy? How do they service their customers? What is their approach to quality control?
Now, armed with thorough knowledge and understanding of your competitors, turn the lens on yourself and your business. What is your area of excellence? What do you do at least 90% better than your competition? What is your USP (Unique Selling Proposition) – something you do that definitely benefits your customers and that no other individual or company can offer? (This is what makes it “unique.”) How will you position your product or service in the marketplace to capitalise on your area of excellence and your USP? How will you price your product or service in light of competitive pricing practices? What will be your sales and marketing strategies?
Bear in mind that, in some instances, the competition may not be another individual or company but what may, at first, appear to be another industry. For example, a chief competitor of the cruise liner industry is land-based holidays. Both industries are competing for the same holiday dollars.
The purpose of this newsletter is not so much to devise specific sales and marketing plans but rather to ensure that you are fully aware of the importance of competitive research, have a plan to conduct the research and are committed to carrying it out. Such a focus will greatly increase your odds of achieving your business and career goals.
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