So far our Developing A Kick-Ass Marketing Plan series has looked at the role of the Mission Statement, the need to really understand What You Are Selling, and most recently, Understanding Your Customer.
Today, we look at those people who’d be happy if you just went out of business – the COMPETITION.
Jack Welch, the now legendary former CEO of General Electric, who is widely regarded as one of the best managers ever in the history of business was guided by three simple rules:
- Cash is king (avoid debt, don’t give credit).
- Communicate (communicate internally so your employees know what they are working towards, and communicate externally so customer and prospects know why you are the best at what you do).
- Buy or bury the competition (one way or the other, make your competition disappear…co-existence is for losers).
Here’s how you learn about your competition.
The Missouri Business Development Network has a great online tool kit for small businesses. Here’s what they say, “By researching your competition, you will learn a great deal about managing your own business.” Areas you need to research are listed below:
- Identify the top five competitors in your market.
- Determine their similarities and differences to the business you are planning.
- Determine whether their business is increasing, decreasing or level. If they are growing stronger, identify why.
- Identify and compare your company’s and your competitors’ strengths and weaknesses (this can be a SWOT analysis).
- Identify methods for making your operation superior to theirs.
- Compare your marketing techniques with those of your competitors (again, a SWOT analysis can be very helpful).
Once you’ve systematically analyzed your competition, you can begin planning strategies to leverage your strengths and take advantage of their weaknesses.
Comparing Your Service or Product
Describe the product or service that you offer and how it stacks up against what the competition has to offer. List similar products your competitors offer and how your product is better. Be realistic.
If your company has unique market positioning, explore how to take advantage of that, and detail why your competitors have not yet discovered or used this market to its full potential.
Do you have an innovative way to market your product that can provide you with a unique strategy? Explore how to use this advantage to your benefit.
Marketing leverage refers to something you do that your competitors do not do.. Look at how your competitors are marketing and describe how your company plans to do it better.
Jack Welch would be proud of you. Stay tuned for our next installment, when we’ll look at how to price your product for greatest perceived value.