Why Competitor Benchmarking is Essential for Your Business to Succeed

In my Marketing Consultancy in North East England, I regularly help small businesses to build their marketing and communications strategy.  I believe in strategy and strategic thinking.  Otherwise, how can you ever focus on your goals, make decisions about the best (of many) courses of action and ultimately achieve them?

I’m a bit ‘old-school’ and have enough respect for the early pioneers and trailblazers in Marketing to follow a traditional approach to strategy building (combined with the most innovative tactics) .  Analysing the Competition is part of the strategy build, but it’s not just a box-ticking exercise.

It can be one of the most enlightening steps on the journey and a chance to reflect and learn.

Competitor Benchmarking holds a yardstick up to your commercial rivals and a mirror up to your own business.  It is a hugely empowering process, for even for the smallest enterprise.

Here’s why.

Giant Slaying

It is well-know fact that people are afraid of competition.  They don’t like it.  It makes them feel threatened and a bit out-of-step.  This applies to every part of our lives: school, siblings, romance, the workplace.

When you look at your competitors, you may just see what you are conditioned to see: they’re more popular, handsome, wealthy or successful and you can’t see beyond that.  You certainly can’t see why it is so.  Or even if it is true.

You need to look at them from above, from a great height, and look at their whole eco-system objectively.  Then zoom in to look at particular areas of their business to see how they are doing it.  Often, they’re not so good-looking close up!  And a trained marketing eye will find their weaknesses.

Remember, it was David who overcame Goliath…

USPs and Differentiation

We’re all aware of the need for USPs (Unique Selling Propositions) and are expected to rattle them off at will.  Gosh, that can be hard.  They often end up sounding banal: quality, professionalism, customer intimacy, etc.

So what if you had a bigger set of vocabulary to use, based on an extensive set of criteria.  That’s when it gets interesting.  For example, your collective experience and qualifications, when looked at in detail, will make your company different. Is there anything that only you know or do?  A particular product that only you make?

If you haven’t looked at your competitors in detail, you won’t know if you really are unique.

But if you have and you know it to be true, you can tell the world with confidence.

Market Positioning

The 7Ps (Product/Service, Price, Place, Promotion, People, Processes and Physical Evidence) are as important to your business today as they ever were.  Don’t be fooled into thinking that they’re not.  If you haven’t found the right combination for your target customers, it will affect your company’s success.

Competitor Benchmarking looks at how your business rivals are faring and gives you the important yardsticks with which to measure your own business.   It also tells you where competitors are hoping to differentiate themselves from each other.

SEO (Search Engine Optimisation) and Digital Marketing, for example, can tell you a great deal about how competitors in the same space are trying to differentiate their offering (Promotion) and who they are targeting.

They may not be targeting your target market!

Alternative Strategies?

Once you have got the full measure of your competitors you may discover that there are ‘gaps in the market’.  You may be smaller, more agile and able to respond to these gaps more rapidly, but make sure that there is also a ‘market in the gap’.

You may find that you have complementary skills, processes or products and services.  Is there an opportunity to collaborate?  Or to refer customers to each other, when you don’t have what they’re looking for, but your competitor does?

In many industries, this is increasingly the model but it does require deeper knowledge of the market place, and real confidence in what your company does.

You may discover that you are more different than you think.

Acknowledge their achievements

Occasionally, people can be unfairly critical of competitors or even complacent about them  If I had a £10 for everyone who has told me that they “don’t really have any competition”, I’d be a millionaire by now.  Okay, slight exaggeration, but you get the point.

Even if your product or service is the first and only one of its kind in the whole wide world, you are competing with the next best thing, the thing your target customer found first, OR buyer apathy.  They may buy nothing at all!

When you consider the trailblazers in your industry, market makers in your sector, you also learn who is deserving of your respect.  You lose nothing but showing them respect and if they are secure, they may even help you up the ladder.

Ask yourself, honestly, are you prepared to do what they had to do to get where they are today?  You may not be…

And that may be okay.

“Maybe you ain’t doin’ so bad after all…”

Clients often think the competition is ‘taller and better-looking’.

It’s really encouraging to find that they are heavily made-up and walking on stilts!

The knowledge this gives these small businesses enables them to create their brand, their marketing strategy and ultimately to sell their products and services with authority, pride and authenticity.

This is the part that I enjoy the most. 

So who is the Goliath on your street?

Have you found a way to look at their business more closely and get some perspective on ‘them and us’?

I’d love to hear how you discovered what was unique about your company and how you used that knowledge to take your business forward.