Who are your competitors?
A competitor is a rival business which is roughly the same size as yours and makes similar products to you. Your competitor will challenge your business for the same target market due to the similarities between your companies. Therefore it is in your best interest to take any advantage you can get to keep your business afloat and allow it to grow.
Why is it important for small businesses to research their competitors?
One of the primary reasons you are setting up a business is to harness a gap in the market. Researching competitors is therefore crucial in assuring that there is still a market for you, even before you even start your business. If you are thinking about starting a business, check out How to Start a Business? for an easy guide to kick start your business idea.
Researching your competitors is a form of planning in itself. It gives you an understanding of how high you should be pricing your widgets, for example, or what strategies have worked best for your competitors. This allows you to not only be inspired by their methods but also allows you to refine them for a competitive edge.
They are your competitors and therefore will likely be sharing similar suppliers and certainly a similar market. Therefore thorough research, throughout the business’s lifetime, will allow you to be one step ahead when it comes to winning a new bid or securing an at risk contract.
Researching competitors is crucial, but it is the use of these researching techniques that allows your business to blossom. While using the techniques below, be sure to ask yourself questions that can help your business, rather than purely understanding the competition. Such questions may be:
- Has my competitor overlooked a particular segment of the market?
- Does my competitor lack a producible service that clients in my market want?
- What campaigns has my client run that I myself can use to great effect in my business?
Fundamentally, the goal of researching competitors is to get the upper hand in a competitive environment.
Top 10 tips and tricks for researching your competitors.
Your first point of call should be a simple Google search
This will expose you to your competitors main website. From here you can get an understanding of their ideas and their angle on the market you both share. What you see on the screen says a lot about the business as a whole.
Firstly, the process of using their website gives an insight into their user experience. Is the website clear and easy to understand? Answering this question allows you to evaluate how good your competitor could be doing online. A clean website design which quickly and easily allows first time users to access their products through their website is a must. Anything which takes away from this ideal is usually easily picked up on and often deters people from the competitors website. Picking up on these flaws allows you to not make the same mistake when creating your company website. More difficult to pin point however, is what the website does right. Naturally, you would want to incorporate these into your website too.
Secondly, a more thorough look at their website often allows you to identify sections of their search engine optimisation (SEO) strategy. Checking for keywords, meta descriptions and high level topics can be a great way of highlighting which areas they have focused on to bring clients to their website. Similarly ask yourself, “are there any important keywords they have missed and I can take advantage of?”
Get to know your competitors
If it is a physical store, researching your competitors can be as easy as visiting their premises. This can be a great insight into how they work, how they treat their clients and how effectively they sell their products. You will be getting a firsthand experience of all these things which you can then use to further your own business.
Conferences and industry trade meetings are another easy way to get a good understanding of your competitors. In the words of Amy Lewandowski, who heads marketing at online retailer PepWear, “we make sure to visit competitors’ booths while we are there and observe their interactions with customers, pick up literature, and check out the quality of their products,” she goes on to say how she is “always shocked that most of them never visit our booth”. As you can see, even if the competitor does come to your stall, visiting these conferences is a great way to get an understanding of their business model, marketing strategies and the effectiveness of their product. Information like this is crucial in your research of your competitor as it allows you to compare your processes and product to theirs.
For an extra tip: often you and your competitor will share the same suppliers – it is helpful to get to know them. Although asking crude questions such as “what did my competitors order and in what volume?” won’t be helpful, it can certainly be advantageous to ask questions such as “How many units of a certain product have been pre-ordered for next month?”. Questions like these help you discern what your competitors are ordering and can often give you an indication of their growth. In addition, learning how to grow your network, as explained in our other MachFast blog, is critical for all aspects of business. It generates referrals, gives you access to professional services and can give you advice when you need it most.
Ask for your customers or clients’ views
Be sure not to skip more obvious ways of researching such as asking for the views of your customers. When you gain a customer, ask them what brought them to you and when you lose one, similarly ask what made them leave. After enough of these questions, you should get a very clear idea of what customers view as preferable and the competitive landscape as a whole.
Backlink research tools
Another easy way of researching your competitors is using backlink searching tools. Backlink tools show you which links, from other pages, connect back to your competitor’s page. Like looking through their website, using backlink tools will give you a greater insight into their SEO strategy. This is because you will be identifying their backlink profile which helps their site rank. Ask yourself questions like, do I have enough backlinks to my own site? Do my competitors have backlinks from quality sites that are helping them earn their high position? This all helps you climb the rankings so that your web page pops up first on Google.
Even without establishing your competitor’s backlink profile, using backlink tools is helpful in finding out what other websites have said about them. Like asking for your customers’ views, this helps you establish what your target market wants from your products (or similar products in the case of your competitor).
Google services such as Google Trends and Google Alerts
These two tools are excellent for competitor analysis. Google Trends allows you to compare the popularity of a specific term, phrase or person over a specified (specified by you) time frame. This allows you to see who the top players in your market are. Furthermore, Google Trends allows you to compare the popularity of your brand with your competitors’ brand. It displays the result in a single graph giving you the opportunity to see the effectiveness of your online brand image. If you are too small to appear on Google Trends, searching up key words gives you an idea of the main brands within your market.
Google Alerts is similarly an effective device for competitor analysis. It is an aggregate of the results from Google searches, news articles, blogs, feeds etc. of a topic (name, keyword, site) of your choosing. Sent to you by email, it automates collecting intelligence from your competitor and makes competitor analysis easier. It allows you to track the trendiness of your competitors and see the effectiveness of their marketing strategies. A handy tip is to set up a Google Alert on your own company name to see the efficacy of your own strategies. In addition, the whole point of competitor analysis is comparison to your own business. Having both you and your competitor(s) on Google Alerts allows this direct comparison to happen on a daily basis.
Scouring social media
In a similar vein to a Google search, looking through your competitors’ social media pages gives you an idea of how your competitors are branching out to your shared market and how successful they are. Studying their pages gives you more information on their marketing strategy. Looking for things such as the frequency of their posts, what they post about and the number of followers, likes, and reposts they get can all be helpful in determining the effectiveness of their strategy and pitting them against your own small business.
Social media is also very helpful in determining the customer response to your competitors product. Using free online tools such as Mention, you can view the conversations and chats your competitors appear in. This is effective not only in judging your competitors strategy and finding out what the market is in need of, but can also be used by your small business to determine your own customer satisfaction.
Facebook and Facebook-owned Instagram are great platforms to research your competitors. Their API allows you to search which ads your competitors are using on these platforms. This gives you further insight into their marketing strategy and evaluating this can give you valuable information. From this you can discern whether they have missed any good advertising opportunities and you can compare their advertising campaign to your own; all giving you a competitive edge against your rivals.
Another way to gain a greater understanding of your competitors’ advertising campaigns is by searching keywords to see if your competitors show up on the sponsored listings of Google or other search engines. This includes searching their business name as they are probably bidding on that too.
If you are looking for a more effective, but more expensive solution, there are paid tools such as SpyFu which allow you to see every keyword they’ve bought on Adwords, every ad variation and every organic rank for the past 14 years. This is super effective in seeing what Ad campaigns and strategies have run in the past and whether they have worked. Information like this helps you not to make similar mistakes and can also help you discern what they might try to do in the future. This will allow you to streamline your own Ad campaigns with the knowledge that certain Ad campaigns have failed for your competitors, putting you a step ahead when creating your new Ads.
Looking at social media platforms, such as Linkedin, and websites, such as Stack Overflow, for jobs your competitor has posted is important to the researching process for a couple of reasons:
Firstly, it is often a tell tale sign of what your competitor is going to do next. For example, if they are a single cafe and they send out a job for a managerial position, then it suggests that they could be moving to multiple locations. This is helpful in tracking your competitors growth and direction.
Secondly, the rate at which your competitor employs new personnel can indicate numerous things. On the one hand, if your competitor is hiring more managers and supervisors it can indicate that his business is growing. On the other hand, if they are hiring many new entry-level employees, without many new managerial positions, it suggests that the business has a high turnover rate.
As their competitor, you are likely to have a similar business structure to them. This means that your own employees can be a valuable source of information.
Firstly, they might have come across your competitor searching for similar jobs and therefore are likely to have done research on that company. As a small business, it shouldn’t be too difficult to ask them what they know. This will offer another perspective on your competitor’s business and could bring light to things you may have missed.
Secondly, you are likely to hire from your competitors and questioning your competitors’ ex-employees will give you an on-the-ground insight into their business operations and strategies. One of the best times to ask questions about your competitor is during the job interview. They will be focused on getting the job and making you happy, therefore they are unlikely to query any targeted questions about their previous employer.
Conduct a survey
Our final tip at MachFast is to conduct a survey. Getting an independent person to email your competitors and ask them the same questions about their services is an effective way to analyse your competitors. The questions could be along the lines of: how expensive is the product? or how fast is the service response time? Questions like these, sent out to multiple competitors, show you the competitive landscape your business will be thriving in and allows you to adapt to the landscape.
It is important to note that it is best to get an independent person to send out this survey. As both you and your competitors are functioning in a tight knit environment, you don’t want them to know that they have been under investigation, especially if they approach you in an industry conference.
Looking for more advice on starting a business? Was this helpful? If so, check out our other blogs designed to help small business owners and creators like you.