How Well Do You Know Your Competition?

By Rieva Lesonsky

Want to know one of the secrets to business success? It’s knowing your competition. When you first started your company, you probably did market research where you assessed your major competitors to find out what you were getting into and where you could gain an edge. As our businesses grow, however, many of us get so wrapped up in the day-to-day that we forget to keep tabs on what our competitors are doing.

That’s a big mistake. Ignoring what your competitors are up to or assuming they’re following along the same path they were when you launched can have devastating consequences for your company. Here are some tips to help you keep up on the competition:

Read all about it. Check out trade magazines, industry journals and websites for your industry to find out not only what your specific competitors are doing but what similar businesses are doing.

Use tech tools. One of the best ways to keep up on the competition is to set up Google alerts to the names of key companies. That way you’ll be continually notified what they’re up to. If your competitors have blogs, set up an RSS feed so you’ll get the latest posts delivered directly to you.

Use social media. Visit your competitors’ Facebook pages and follow them on Twitter to see what they’re doing. Since companies use social media to communicate with customers and get their input, reading between the lines can give you insights into new product or service launches, expansion plans or marketing campaigns the competition might be planning.

Get personal. Visit the locations of your key competitors or shop at their websites to see what they’re offering, what kind of service you get and what kind of pricing they offer. Keep an eye out for new marketing methods or sales tactics they’re using.

Think indirect. Direct competitors aren’t the only ones you need to worry about. Don’t forget to keep an eye on indirect competitors. These are companies that compete for the same dollars you are, even if they aren’t in the same industry. For instance, if you own a casual restaurant, your competitors could include fast food chains, fancy restaurants and even convenience stores that sell prepared food.

Assess what you learn. Regularly set aside time to think about the information you’re gathering. Is your competition growing or struggling? What long-term plans can you spy from your research? Are they targeting new demographic groups? Are they expanding geographically?

Your competitors are a key benchmark for your business. Compare how you’re doing to how they’re doing and look for weaknesses that can spell opportunity – and success – for your business.

Image by Flickr user Tony (Creative Commons)

This entry was posted on Wednesday, January 26th, 2011 at 10:30 am and is filed under Small Business, small business. You can follow any responses to this entry through the RSS 2.0 feed.


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