Every business needs competition to succeed, and for continued existence. Ironic right?
In the face of competition, it keeps businesses and business owners on their feet, in search of ways to keep up with trend and be ahead. This subconsciously leads to a general growth.
However, competition gives either of two possible results; it makes or breaks a business. To be on the former, a business must successfully compete, and to successfully compete, you must know your competition.
Competitive analysis means to understand who your competitors are, their strengths, and weaknesses. It doesn’t stop at understanding who they are, but learning from them.
To run a competitive analysis, you need to
+ Firstly, determine your competitors and their market behaviour. What makes them your competitors?
Are they:
a. Imitators (i.e. they copy ideas and product pattern)
b. Price breakers (i.e. their prices are comparatively better) or
c. Innovators (they create new ideas and inventions in your field that outsmart yours)
+ Secondly, you try to understand how large the market share of your company is and identify who has greater stance in determining the key market rules
+ Try to assess whether new competitors can penetrate your market, thus causing a stir in market behaviours.
Conducting a proper competitive plan equips you with the necessary tools to create a proper operational plan.
