3 Tips For Assessing Your Competitors
Knowing the competition is extremely important… not only to business owners and upper management, but also for front-of-line managers such as yourself. If you want to move ahead and put up sales numbers that show growth and a profit, then you need to know your competition. The best way to get to know them, of course, is by researching them. Assessing your competitors may seem like a difficult assignment, but it is not all that hard to get some basic information about them. Even your own customers can likely give you valuable insight in to what your competitors are up to, none of which should be taken lightly.
With that said, here are 3 tips for assessing your competition. These areas are all relatively easy to research, and will show you where you have the potential to be outmatched or outsold by them. Being aware of the problem, of course, is half of the battle. By researching your competition just a little bit, you can easily identify their main strong and weak points. This information can then be used to your advantage as you attempt to make your organization an even more appealing choice for potential customers.
1) Assess Their Prices
What are your competitors charging for the same types of products and/or services that you are selling? Are they offering better quality, or are customers not getting as much with them as they are with you? You can’t always find out what your competitors are paying for goods or services, but you can easily find out what they are charging… and this can tell you a lot about what you are dealing with. Are they offering products for prices lower than you can even buy them for? If so, then you will need to make up the difference in a different way. Remember, selling is all about building up the value of your product so that it is worth more in the eyes of your customer than it costs.
If you are having trouble competing with the prices of your competitors, remember that only a small percentage of consumers choose a particular product or service based on price alone. There are a lot of other factors that come into play, and we are going to talk about two more of them in this article.
2) Assess Their Commitment to Customer Service
Lower prices generally tend to have an adverse effect in the customer service department of any business. They have to cut costs somewhere to charge low rates… and a lot of businesses cut these costs by lowering what they will pay their employees. This, in turn, tends to create a customer service problem. In fact, many modern retailers and food-service organizations have a problem with this nowadays. They have worked so hard at lowering their prices that customers have pretty much learned to expect poor service… the only question here is, is it really worth it?
A lot of customers will actually pay more to get better service. Of course, one needs to remember that customer service does make a difference, but that does not mean that a customer will pay a ton more. You need to take all of these things into account, and use all of the information in hand to figure out how you can build the value of your products/services up to a point where the perceived value surpasses the cost, as well as the perceived value of your competitor’s products/services.
3) Assess the Actual Quality of What Your Competitor is Selling
Is your competitor selling the exact same products as you, or are they selling something just a little bit different that will appeal to the same customer? If so, is what they are selling actually better than what you are selling, or does it not work as well? Is there a difference in cost? If so, does it reflect the difference in quality, or are they charging the same amount for something that is better or not as good? These are all important things to keep in mind. If you are aware of not only what your competitor is charging, but also of what the actual quality level is in their products, then you can use this information to truly analyze what you have to offer potential customers.
If you can’t beat your competitor in price, then maybe you can offset this disadvantage by offering better customer service or quality?
Why should a customer come to you, and not go to your competitor? Finding a way to answer this question will really help you to utilize your assessment and information in such a way that it can work to your advantage.
Learn how to assess your competitors with these free eBooks and checklists:
Strategy Process Checklist
This checklist describes a twelve-stage process that will assist you in developing your strategy and gaining approval for it.
PDF & Doc
SWOT Analysis eBook
This eBook describes the SWOT analysis, a technique that you can use when deciding on the best strategy for achieving future growth.
ISBN 978-1-62620-951-0 (33 Pages) PDF, Kindle & ePub
SWOT Analysis Template
This template is designed to help you complete a SWOT analysis.
PDF & Doc
Porter’s Five Forces Analysis eBook
This eBook describes Porter’s Five Forces Framework, which provides a model for industry analysis and strategy development.
ISBN 978-1-62620-999-2 (33 Pages) PDF, Kindle & ePub
Porter’s Five Forces Analysis Template
This template is designed to help you complete a Porter’s Five Forces analysis.
PDF & Doc
- Assessing your competitors may seem like a difficult assignment, but it is not all that hard to get some basic information about them.
- What are your competitors charging for the same types of products and/or services that you are selling?
- Lower prices generally tend to have an adverse effect in the customer service department of any business.
- A lot of customers will actually pay more to get better service.
- Is your competitor selling the exact same products as you?
- Are they selling something just a little bit different that will appeal to the same customer?
- Remember, you need to assess the actual quality of what your competitor is selling.
- If you can’t beat your competitor in price, then maybe you can offset this disadvantage by offering better customer service or quality?