Where can you find these answers?
• Use the Internet
• Be a mystery shopper and visit their stores or locations. Order from them.
• Talk to their customers.
• Analyze their ads.
• Attend their speeches or presentations
• Go to trade shows and visit their displays
• Look at written sources
• Yellow Pages
• Annual reports
• Computer databases (ask at your public library)
• Industry surveys
• Trade association publications
• Local newspapers, magazines or journals
Understand this: the more research you do, the more you increase your probability of success. However, you can research until the moon turns blue and at some point you have to launch. You have to make that decision.
Take your idea and put together a spreadsheet in Excel that shows the questions for your research of your competitors (or potential competitors) in your market area.
Now we go to step 7. This is where it gets even more interesting.
1. First of all, you will see those businesses with your own eyes in the regular course of your day. If you’ve had your business idea for a while or you’ve been in business, you have a good sense of who your competitors are.
Take notes. Write down their names, their offerings, their special deals, their marketing offers; collect their ads; get on their mailing lists; visit them in their stores; walk their aisles; ask them questions; see how their staff treats you; take more notes.
Specifically, focus on these questions:
• In your competitive area, can you clearly identify who else is providing the same or similar products or services as your business?
• Do you know what their market share is?
• Do you know if their market share has been declining or growing in the past 5 years?
• Can you give specific numbers?
• Do you know if the number of similar businesses is increasing or declining?
• Given the previous answer, what do you project the total number of similar businesses to be in the next year?
• Can you list all of your potential competitors by name?
• Do you know what their Unique Selling Propositions (USP) or distinctive advantages are?
• Do you know what their capabilities are?
• How does (or how would) your business differ from the competition in terms of pricing?
• Is there (or will there be) a clear differentiation about your product or service?
• Are you aware of what other similar businesses are offering that you don't?
• Do you know how they communicate in ways that you should?
• Do you know what means of marketing they use that you might adapt?
• What are your competitors’ biggest weaknesses or failings?
• How could you specifically compensate for that failing so that you gain market share?
• What do they do well?
• What do they do poorly?
When you look at it that way, it’s a lot of research. If you are about to launch a business, you would do very well to understand this information before you dive in. I would try and break it down into several categories or columns. Make sure you include at least the following:
Section 5: Research
Step 6: Competitive Research
Step 6: Who else is providing the same or a similar product or service?
This is a fairly easy one to understand, though it can be time consuming to do it well. There are several sources for you to go to and I’ll list them there.