Pinpoint your Potential Competitors: The Foundations of Market Research

In running your for-profit business, consider the fact that you are competing to win. In the same way that you would compete for the ultimate prize in a sports event, your business is aiming to win the “profit prize” from the competition. For this reason, it is of the utmost importance that you suss out precisely who your competitors are; in the business game you need to know the competition before you can beat it. Perhaps the quickest way to figure out who your biggest competitors are, is to (figuratively) remove your business from the equation. Without your existence, who would be supplying customers with your products or services? Now, put your business back into the equation. Who is trying to “steal” your customers? On the flip side, whose customers are you trying to steal? In answering these questions you will be able to identify your direct competitors.

To identify your indirect competitors, you will need to ask yourself the following question: “If your products did not exist, what other products would customers buy to fulfil their needs or solve their problems?” These businesses tend to offer alternative products or services to those you are offering. While they may not currently be a threat, they could become your direct competition in the future.

Once you have built up a database of who your competitors are, you have the opportunity to determine their strengths and weaknesses in terms of product offerings, price, client base, available resources, customer service, and marketing material. Use this information to build a better marketing strategy, funnelling their customers your way.