A very important aspect that every marketer should incorporate in the Marketing Plan is the Competitive Environment. Nowadays, businesses can be very competitive so the more knowledge you have in different industries and businesses, the better prepared you are to beat your competition. There are more ways to analyze your competition. However, a good start can be to analyze their industry, products and client focus. Analyzing your competitors can take a vast amount of time so start by following these 3 simple steps.
Make a competition list
When making the competition list, be sure to include the businesses that primarily sell the same products as yours, but also the businesses that sell a similar product to yours. For example, you want to include a healthy food place on your list, even if your business sells only salads and your competitor doesn’t. Healthy food can be prepared and offered in a variety of recipes, therefore, you should include a business that sells healthy bowls or steak on your list. Quinoa can be added as a salad topping but also as a side to a steak. It’s still considered healthy and gluten-free. So, you need to include direct and indirect competitors that you know are doing well in your space. You are competing with anything that’s out there. Make a spreadsheet and include all the relevant information you can find. How do they advertise their business, what delivery apps they use, what social media platforms? Read their reviews and see what customers are saying about your competition. Do they have a rewards program, happy hour, bundle sales, catering, office lunch offers? Analyze all this information from a client’s perspective. Why should a client choose your place over the competition? In fewer words, what do they have to offer and you don’t or you can’t.
Analyze their products
This section should be your main concern. You need to buy your competitor’s products and find out if they are offering an upsell or a down-sell. Analyze their menu. How are their products perceived? Pricey, cheap, delicious, worth the money, organic, fresh, homemade. What’s the size of their portions compared to the price? Do they have seasonal offerings? What raw food provider did they contract, better said, see who delivers the produce for them. It can tell a lot about how they keep their variable costs down and increase their contribution margin. What recipes do they offer? Local, fusion, American, European. Some customers can buy a certain type of food only because of the so-called product’s geographic location. They buy a well-told story, that gives them a certain feeling, they don’t necessarily care about the product. The hot buffet offered by Whole Foods has nothing special, no taste. But customers prefer going there for the “organic” feeling. At any given moment, you can find rich recipes, farm to table products that small businesses offer without being Whole Foods. But customers don’t care about any. They want to buy a certain feeling, that national chains like Whole Foods can offer. The feeling that you can afford to buy food from Whole Foods. They have nothing special, but good marketing.
Analyze their clients
See how your competitors are placing themselves in this competitive environment. The way their brand is placed should mirror the customers they have. Are they an upscale or fast-casual restaurant? To analyze the time frame that matters the most for you, you need to go there at breakfast, lunch, dinner. You need to understand where your competitor’s traffic is coming from. Analyze the customers. Are they the ones you need to increase your sales? That’s the first confirmation that you are looking at your competition. Another good way to understand your competition is by doing exactly what their customers do. Wait in line, order online, see what are they ordering, ask their employees about the most popular products that they have. Check their daily and weekend hours of operation. Are they open all day, only for lunch, or lunch and dinner? Are they offering late lunch? That tells a lot. It means that some customers use their late dinner service. Everything is for a reason. As Tony Robbins said, “The surest way to achieve success is to model someone who is already successful.”