Scoping out your competitors is to business what a flashlight is to hiking in the dark.
In a word, it’s essential.
However, selecting which competitors you’ll keep tabs on can also be overwhelming. A Google search can bring back hundreds of businesses similar to yours, making it hard to choose which to watch and which to ignore. Even companies with seemingly obvious competitors can overlook valuable data if they don’t have a solid approach to pinpointing who their competition really is.
If we’ve learned anything about competitor research at MJM, it’s this: begin with a thorough profile of your ideal customer. Why? Because understanding your customers’ values and mindset will lead straight to the places where they spend their time and dollars.
As you build customer profiles, keep in mind that consumers are often buying experiences, identities, or even aspirations more than they’re buying goods and services. Gym membership, anybody? Many of the other companies that your ideal customers do business with are your competitors even though they may occupy different spaces. A restaurant and a clothing boutique are markedly different, but because both vie for the same slice of a consumer’s household budget — in this case, disposable income — they become competitors.
This isn’t to say that if you’re trying to market your dental practice you shouldn’t monitor other practices. You should do that, too.
Here are a few tips for selecting your direct competitors:
- Google search. We panned it at the beginning of this article, but here’s how to get it right. Instead of searching “dentists in Orlando,” which will bring back too many results, search your own business instead. Then, look at the four or five results that surround it. For comparison’s sake, you should search your version of “dentists in Orlando” to see how you rank among the larger pool of similar businesses, but when it comes to those you really want to dig into, keep it to the few who lead the search results when you search your specific business by name.
- Old-fashioned sleuthing. Not all your research has to be digital. Local and national magazines cater to specific demographics. Find one that reaches yours and flip through it. Who’s advertising in it? Likewise, billboard and outdoor advertising in the part of town your customers frequent or the commercials during television shows, podcasts, or radio programs they prefer are good places to pay attention. This includes both over the air and streaming platforms.
- Just ask. Being direct always yields results. Draft a survey or, if possible, talk to your customers in person about the other companies they do business with. Asking for their preferences takes out the guesswork, but be sure to approach your interview so that customers give their honest feedback rather than what fits your agenda.
- Use digital tools and platforms. Google offers competitor analysis tools that show which companies compete most with your content on search engines. Facebook has rolled out a similar program, and if you pay for digital ads, there are plenty of tools to gauge how much traction you’re getting among your competitors.
Pinpointing a few competitors to monitor is essential, but being overwhelmed by it isn’t. Implementing just a few of the tips above will have you reaping the benefits in no time.
To get you started on your customer profile, we’ve compiled a report on how the pandemic has influenced consumer behavior. Download yours: