Market analysis is a means of gathering important information about your market competitors. It gives you insight into the quality and techniques of your competitors and enables you to understand your market conditions. When you analyze your competitors, identify the similarities and differences between their products or services and yours. When you’ve identified key characteristics of your competitors you can establish a plan to compete. For example, you may lower certain prices, offer better service, advertise, use special promotions or add to your product line or services.
You should collect the following information:
- Who are your competitors?
- Where are they located?
- What products or services do they offer?
- What is their pricing?
- Estimated revenue?
- Do they advertise? Where?
- How do they market? (Informational sessions, direct mail, etc.?)
- What are the perceived strengths and weaknesses of your competitors?
- What type of equipment and software are they using?
- Review competitors’ websites, literature, and marketing materials – how do they present themselves to the market; are they a professional organization?
Sources of Information:
On-Site: Make visits to your competitors or shop them for services and pricing. You can you use your employees or friends to do competitive checks.
Internet: The Internet can be a great source of information. Enter the competitor’s name in search engines (Google, Yahoo, MSN, Ask, etc.) and check out the results of the search. The Internet can give you an overview of your competitor’s services, products, and maybe even prices and referral sources. You can gather this information without having to leave your computer. Information is available from the Federal Commerce Department online or in the library. You can review Edgar Online and business websites to obtain required financial filings. Look for an industry trade association and industry publications. Go to Hoovers Online or Bacon’s to look for business publications in your industry.
Competitor: During your research of your marketplace, you can gather information from competitors that provides you with insight on what makes them successful (or not!).
Networking: Join community and civic groups. It’s a great way to network and meet other business people (maybe even a competitor or two). Determine the business in the market that could be future referral sources and/or clients.
After the information has been collected and your competitive research completed, you will be able to describe your competitors and their strengths and weaknesses. You should know what is different about your business and why customers will choose you rather than your competitors’. You should also be able to describe your target market and target customer and what will motivate them to purchase your product. This process should help you gain and maintain a competitive advantage
Ed Teixeira is a recognized franchise expert with over 35 years experience in the franchise industry. He operates franchiseknowhow.com, writes the Franchise Expert blog and consults with selected clients on domestic and international franchising. He has served as a corporate executive for franchise firms in the retail, manufacturing, healthcare and technology industries and was also the franchisee of a multi-million dollar home healthcare franchise. Ed is the author of Franchising From the Inside Out and The Franchise Buyers Manual and has spoken at a number of venues including the International Franchise Expo and the Chinese Franchise Association in Shanghai, China. Over the course of his career he has been involved with over 1,000 franchise locations. and has launched franchise concepts from existing business models. Ed can be contacted at 631-246-5782 or email@example.com