If you were considering opening a coffee shop, who would you consider your “direct competition”? Starbucks? Caribou? Dunn Bros? Dunkin Donuts? Who would you consider your “indirect competition”? A bakery? A fast food joint? A gas station? All of them!!
There was a time when most individuals would go to their favorite coffee house and java would have been the primary product sold. However, today you can get coffee from just about anywhere. If the end result is coffee and the one serving it can provide a quality cup of it at a reasonable price, “where” you get it, the environment if you will, moves down the priority list to those looking for price, convenience, speed and how the overall experience makes them feel.
I have said it before and it bears repeating, if you are a new biz entering a busy market it is imperative to be offering something different and uniquely unlike what everyone else is. You also need to be a rock star at effectively communicating to your niche persona(s) why what you are selling should matter to them.
I emphasize to all my clients, corporate and entrepreneurs, that you must do a detailed competitive analysis or at the very least there should be some serious due diligence prior to an initial launch (or re-Brand) so that you are more fully informed about your competitors than they probably are about themselves.
We all have competition no matter what product or service suite we are selling. Some are obvious, APPLES TO APPLES as the saying goes but there are also those who are touting something similar or exist on the fringes of an industry circle offering a piece or parts which most definitely could cut into market (and mind) share.
I recently had a client who is a relationship coach. When we were working on her competitive analysis she informed me she didn’t have any direct competition. I had to share that it doesn’t always have to be APPLES TO APPLES in comparison. It’s about solving someone’s pain and the degree of “pain” they are in.
For example let’s say you have been invited to the Red Dress Gala and you don’t have a red dress. The “pain” is that you need a dress that’s red. If the event is in a couple of hours and you really want to go, you’ll go where you need to and pay what you must in order to get the dress in hand. However, if it’s in a few weeks/months, you’ve got time to be more selective in style and price.
Let’s look at the relationship coach example. If the “pain” is “I’d like a boyfriend” then the one looking has options:
- Hire a relationship coach and have them screen candidates and have them bring the best of the lot to you.
- Join an online dating platform and go through the list of candidates yourself.
- Sit at a bar and wait for someone to approach you.
You either pay the coach, online platform or bartender, but the result in meeting someone technically can be achieved by any/all of the options above. The only difference is price and the experiential component of the process.
The point is we all have competition and it’s rarely APPLES TO APPLES since there are so many ways to achieve a result. Keeping tabs on your close or pseudo-competitors doesn’t mean you need to watch them like a hawk or let them keep you up at night, but you should do an annual review of them and be on the lookout for any new challengers.
Being aware and consciously conscious of all that your competition is dishing up allows you to put together a dynamic strategy that highlights your strengths and ideally align with any weaknesses they may have. As a business owner, you need to always be one step ahead to claiming market share and converting sales. Forward march.