The Marketing Plan: The Competition
Some businesses spend a lot of time and money keeping an eye on the competition. It makes sense; your customers are aware of your competition and even the most loyal of them will compare your products, services and pricing with others. You must constantly remind the customer that your product is different; it is of superior quality with more features and benefits, it is better value for money or it is supported by superior service. Few advertisers name the competition; that would be as good as a boost. Rather, most advertising messages build on the image or reputation of the product or service, emphasizing that it is different and better.
The smart entrepreneur will have identified the competition in the original business plan and the marketing plan. Your plan will say something like, “these are the products or service providers in the market and this is how we stack up against our competitors”. One of the assumptions in your business plan and marketing strategy is the competitive landscape. Over time, new competitors may enter the market and it may be necessary to modify your marketing plan to respond appropriately. Entering a market which is already well-served by strong, profitable competitors makes little sense. It is assumed the rational entrepreneur will only enter the market when there is little direct competition and opportunity exists to build a customer base.
Whether the business is online marketing through social media channels or the traditional “bricks and mortar” model, using more conventional marketing media, the advertising and marketing plan must constantly feed the business with new customers and reinforce the loyalty of existing clients. The marketing message will focus on the merits of the product or service, their appropriateness for the customer’s needs and the character of the firm behind the product. The messaging will never call attention to the competition; outwardly, it will presume that there is no competition.
At the same time, we constantly monitor the market and our direct competitors, looking for emerging trends and shifts in consumer behavior. If there is a challenge to our market position, it will come from our existing competitors or a new entrant in the market. Either way, we need to be ready with strategies that will keep us in the lead.
Here are some key points to remember in your competitive strategy:
Innovate to Differentiate
Innovation and imagination should be a preoccupation. Never stop thinking, how can we do this better? What can our customers teach us about new trends, products or services that will set us apart from our competitors?
Know Your Customer
The customer is our reason for being in business. What does our customer want? How can we fill that need in such a way that our customers and others will want to do business with us?
Continually Re-invent Yourself
Nothing lasts forever. The magic formula that worked last year may be losing its lustre. Read the market, talk to customers, suppliers and yes, even your competitors. How can we build on knowledge and experience gained in the past to build a profitable future?
Know the Competition
What does the competition offer that we can’t or won’t. Is our competitor becoming more attractive in the market? Is their product better; is their service better; are their prices better? How can we build on our strengths and develop niches where the competitor is weak?
Be Conscious of Your Image
Not everyone perceives us as we see ourselves. Invite feedback; from customers and others. This is the age of Trip Advisor and Rate-my-Doc. You can invite and receive comment, but don’t jump into two-way social media dialogue unless you are prepared to respond promptly, in a constructive way and you can accept the inevitable trolls who have nothing good to say about anyone.
Pamper Your Existing Customers
This is vital in your marketing and customer service policies and for your employees who must carry them out. Take the time to document how customers are to be treated and make sure every employee clearly understands your customer service standards.
Constantly Search for New Markets
Be alert and receptive at trade shows, conventions or other meetings relating to your business. Look for emerging variations or add-ons in your business. Beware: don’t jump too far out of your niche or core business and make sure you have the financial, manpower and skills resources to grow new markets. While developing new markets, you need to stay profitable and nurture your core business.
Retain Your Employees by Being the Best Employer
Assuming you have hired the right people and you have invested in training them well, you don’t want to become a farm team for your competitors. Make sure your wage and benefits package fully recognizes your employees’ loyalty and accomplishments. In doing so, you may find some of your competitors’ employees coming to you with their résumés in hand.
Keep Your Eye on the Horizon
To repeat the over-used line from Walter Gretzky, father of number 99, “skate to where the puck is going to be, not where it’s been”. Try to be a student of your business; what will the business look like in three years, or five years? What will the market look like down the road? It’s highly unlikely the business will be exactly the same in five years. What are the change factors, and how will they affect the vocation as a whole and how will your business be impacted?
Offer Greater Value
This does not mean the lowest price. For some buyers, your price can never be low enough. Build your business on delivering value for money: quality products and service supported by world-class customer service. Value means quality, quantity and service in return for money. What is your value package?
Look for Gaps in the Market
There are product and service gaps in every market; either because entrepreneurs haven’t seen they or, they believe they’re not important. If you think there is a gap and a sufficient number of consumers agree with you, you may have a whole new avenue of expansion. If you see a gap but you’re not sure about consumer demand, test-market the idea with your customers. Tell them about it through your customer service channels and perhaps offer a sample for a limited time. At the end of the trial period, you should know whether you’re onto something. If your competitors follow suit, you’ll really know you were right.
As we have often said, business is simple; figure out what the customers want and give it to them. In a competitive market, you want to set the standards so high that your competitor can’t possibly measure up.