Keeping an eye on the competition is essential to stay ahead in business. Knowing a rival's strengths will help you identify gaps in your own offer, maintain competitive pricing and keep on top of developments in your industry. Emma Allen finds out how to monitor the competition
Gathering competitor intelligence might sound like something out of a Bond film, but no small firm should underestimate the value of monitoring their business rivals, according to Suzie Shore, director at marketing research consultancy Juicy Info.
"Tracking others' performance will give you a critical business edge," she stresses. "What you can learn depends on the level of detail you go into, but just by looking at your competitors it's possible to track new trends, corporate positioning and diversity of products or services, right through to customer relationship management and marketing promotions.
"It's crucial to understand your sector so you can fine tune your strategy and stay one step ahead," advises Shore. "Keeping a close eye is even more important if you're in a particularly aggressive or fast moving business environment."
Before you get started, you need to identify your competitors. They may not just be local to you — consider those firms based abroad, or businesses that offer a substitute or similar product that potentially threatens your offer. Keep watch, too, on products or services currently being developed, that might affect your future market share.
"Start by using the internet to check out competitor websites, brochures and company material, which can give you details such as branding and pricing," suggests Shore.
To save time, consider signing up to the free Google Alert service, which will deliver the latest news on your competitors to you by email. Set up an alert for any topic — such as the name of your competitor's business or a certain product — to keep up to date.
Social media is another fast and effective way to learn about other businesses. "Check to see which firms have Facebook, Twitter or LinkedIn profiles and sign-up to stay informed on their movements," says Shore. "If they have a lot of followers it's a sign they have found a successful way to attract your target audience."
You should also sign up to key trade magazines online and monitor blog discussions to find out what people are saying about your industry.
Talk to customers
Other key ways to stay informed include attending industry networking events and talking to your customers. "Get your sales teams involved too," advises Shore. "They are customer facing and can pass on valuable comments from what they are hearing about competitors."
Depending on your sector, you could even consider using "mystery shopping" to measure how your customer service compares with competitors or to learn how consumers view your products over rivals.
Act on the information
"To get the most out of the data, you need to aggregate and analyse the details," emphasises Shore. "Draw up a table that contrasts key factors such as brand, product, pricing, service and promotions between competitors, which you can update as required.
"Then, once a month or quarter, draw out the key insights from your analysis, such as the biggest threats or opportunities and use this to develop your own strategies," she explains. "Identifying what others do well will help strengthen your offer and highlight any weaknesses."