Do you know what your competitors are up to?

Imagine having no competition. It would be great, wouldn’t it? Well, maybe not. In reality, competition is healthy — for you and your clients.

No one likes a monopoly

When an organisation holds a monopoly, there is no incentive to improve. And it’s not good for the consumer. Look at Telecom: they still have a bad reputation almost 20 years after deregulation of their industry. It will take more than renaming themselves Spark to shake the public’s negative perception of them. Competition keeps you honest; it discourages complacency and helps you define your ideal client.

How competition is good for business

Here are five reasons why competition is good for business.  It:

1. Encourages innovation — like the old Telecom, there is little incentive to improve if you’re alone in the market. The heat of competition inspires you to try new things in order to stay in business. As a result, your customers get better products/services, and you get a leaner, more efficient business. Everybody wins.
2. Discourages complacency — in evolutionary terms, creatures that fail to adapt become extinct. Competition acts to counter complacency and provides the necessary impetus to help businesses strive for continual improvement.
3. Helps you define your market — competition inspires you to differentiate yourself from the crowd and find your niche. Along the way you develop a better understanding of your customers which leads to the development of better products or services.
4. Helps you learn — your competitors can provide a wonderful insight into the state of your market by showing you what works and what doesn’t.
5. Can be a useful ally — when you’re not alone in an industry, you can team up with your competitors to lobby the government on industry related matters.

How well do you know your competitors?

Don’t ignore your competitors — get to know them. You can do this by conducting a competitive analysis. Depending on your industry, you should do this at least annually and compare prices quarterly.

Make sure you know the following about your competitors:

• What is their product/service offering?
• What do they charge?
• What do they do well?
• What do you do better?
• What can you learn from them?

Once you know your competitors, don’t compete with them head on. Instead, find your unique selling point (USP), dial it up and share it with the world!

To learn more about defining your niche, Signpost Consulting is here to help. Click here to read about our new service – Competitor Analysis