I was at a wedding this past weekend and I had the pleasure of meeting a couple who is in the beginning stages of launching their business idea. I gave them a tip that I want to share with you today. It is something that is foundational when starting a business, yet can be done no matter where you are in your business. It’s something that not all businesses do, but it is important because it will help you build a stronger and more successful business.
Here it what is is: You need to have a competitor analysis.
What is a competitor analysis and why do you need to have one? Those are great questions!
First, a competitor analysis is basically an overview of who the competitors are in your industry, and what their strengths and weaknesses are.
Secondly, you need a competitor analysis because it will give you a better understanding of where you stand in the market.
Not only that, but it will help you build a stronger and more successful business. How?
Conducting a competitor analysis does two things:
1. First, it makes you realize that there are a lot of people out there who offer something similar to what you do
I know, that doesn’t sound very encouraging, but I promise it is a good thing (you’ll understand when I make my second point). It is important to know who is out there, what they offer, how they offer it, what they charge, and then use that research to your advantage. It will give you a better understanding of where you stand, and how potential customers may view you. Here’s where it comes to your advantage….
2. You’ll get an understanding of how your business is different and will force you to really hone in on how you are better (resulting in better marketing)
The first time I created a competitor analysis for my business I was overwhelmed. I felt like there were a billion and one businesses out there who already did what I wanted to do. But as I continued to do my research I discovered how my business would be different from theirs, and therefore how I could stand out in the market.
One of my favorite ad-ons I like to do when conducting a competitor analysis is to also take notes on what I like that my competitors do as well as what I don’t like. I look at their strengths to see what is working and create my own ideas, and then I look at what they do that I don’t like and figure out how I am going to do it differently and better.
This will unfailingly give your business a boost. It will give you clarity on your value proposition (which is just another fancy way of saying how you attract your customers) and will give you an idea of how you can do things better than what is already out there.
I personally do competitor analysis for my business at least once per year. New businesses come and go with time and seasons and staying on top of your market and knowing your industry is important as an entrepreneur.
Do you know who your competitors are? Do you know how you are different from them and how what you offer is better?
If your answer is “no”, then I want to encourage you to have a competitor analysis for your business. If you don’t know where to start, I have an affordable guide & template to help you create a competitor analysis in my shop! You can check it out below!