There are many reasons why a business needs to keep an eye on the competition. From pricing your products competitively, to gauging how similar businesses are reacting to market forces, to understanding where you stand in the highly competitive space of online search rankings.
But how do you effectively sneak a peek at the competition, or even snuggle up to it? Here are five tips for researching and getting to know your competition.
1. Use the Web to Your Advantage
The easiest way to check out the competition, as well as what customer’s think of them, is to go online.
A surefire way of doing this is to conduct a search on popular local online business listings such as Yahoo Local, Google Maps, and Yelp. Enter keywords about your business together with the zip code of the area you serve, e.g. “landscape services, 22182” and you’ll find a list of businesses that also identify themselves by these keywords.
Focus on the top 10 businesses from each search engine result and start your competitive research by checking out their websites for information on products, pricing, service areas, etc. Assess how your offerings stack up — what do you offer that is unique, and how can you work that into your marketing plan to set you apart from the competition?
2. Gauge Customer Opinion
Going back to your search engine results, take a look at the customer reviews posted against your competitor’s business listing. This information can provide valuable insight into why a customer chooses one business over another (even yours).
In addition to standard Web search tools, industry-specific sites such as ServiceMagic, Angie’s List, Dine.com, and OpenTable, among others, can help you narrow down your opinion-based research.
3. Get to Know Your Competition
It’s very rare that any two businesses are exactly the same, which makes it a good idea to get to know, and even network with, your competition — in person.
The rewards can include referrals (if you offer something that they don’t, or they are simply unable to take on additional customers for whatever reason – very common in the freelance/consulting world), as well as potential joint business opportunities. Sometimes going after the same clients can prove more fruitful if you tag team with or outsource to a sub-contractor or partner who can round out your offering.
It’s best to meet and get to know your competition on neutral turf. Associations, chambers of commerce, and other local business networking groups are a great place to do this.
4. Don’t Get Hung Up on Price
While you do want to make sure that your pricing is in line with the market, don’t run the risk of selling your offerings short by focusing on price as your main differentiator — you’ll never win and you’ll end up destroying all your margins in an effort to stay ahead. Instead focus on value — and selling that value effectively. This often comes down to customer service, read “Get the Customer Service Edge” from small business professional, Rieva Lesonsky, for tips on competing and winning business through great customer service.
5. Keep it Up
Staying on top of the competitive landscape is an ongoing effort; however, there are many online tools that can help you automate the process. Sign up for your competitor’s newsletters and use Google Alerts to track what’s said about your competition on the Web.
It’s a good idea to monitor social media sites too. Follow your closest competitors on Twitter and Facebook, or if you wish to be more discreet, monitor them using tools such as Hootsuite.
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