It’s Important to Learn From Your Competitors. Here’s Why.
May 25, 2023
12 min read
What are the benefits of having competitors? In the business world, marketers always push the mantra to entrepreneurs: “Know your customers!”
While it’s essential to understand your target audience, knowing who your business competitors are and what they’re offering customers is crucial. In fact, according to basic economic theory, when small businesses compete for customers, the customer sees lower prices, higher-quality goods, and tailored products and services. Not only that, but companies that learn from their competitors will offer more variety and stay motivated to innovate.
Competitive analysis is crucial: Learning from your competitors provides valuable insights into market trends, strategies, and opportunities, helping you gain a competitive edge.
Analyze effectively: Identify key competitors, research their products and pricing, study marketing campaigns, assess online presence, and monitor customer feedback to gain a comprehensive understanding.
Learn from successes: Analyze competitors' successful strategies, marketing campaigns, and customer acquisition techniques. Adapt and improve your own approach based on these insights.
Learn from failures: Identify competitors' failures and understand the reasons behind them. Use these lessons to avoid similar mistakes and capitalize on missed opportunities.
Differentiate yourself: Highlight your unique selling points, deliver exceptional customer service, innovate, and personalize offerings. Build a strong brand identity and create a positive customer experience.
Maintain ethical practices: Conduct competitive analysis ethically, respecting intellectual property rights and adhering to legal and ethical standards.
Table of Contents
What Your Competitors Can Teach You
Why is it important to learn from your competitors? You can see what your competitors are doing. Market research is one of the most critical marketing plan elements, allowing you to analyze your position within the market, find out what you’re doing well, and determine if there’s anything you should be doing differently.
However, an often-overlooked marketing aspect specifically looks at customer service within your sector. Who better to look at than your direct competitors? Fortunately, it’s surprisingly easy to learn what your rivals do if you have a few hours to put on your sleuth hat.
So, what can you learn about your competitors? First, note that we’re not talking about aggressively locking horns with competitors; we’re simply looking at and learning from others in business. Rushing to get one over on another organization is little more than one-upmanship. It’s downright unprofessional.
It’s also unwise to rely on your competition for all your industry information. Instead, keep updated through other platforms, such as industry-relevant publications, so you aren’t playing catch up with your competitors’ business. Now, you’re acting on the knowledge you’ve gathered.
Nowadays, most large and small businesses have an online presence, which makes it easy to snoop around. So, the first port of call for learning about any organization is for business owners to review their competitors’ websites. During this review, pay attention to their content marketing strategy — the primary way your competition reaches its target market and wins over potential customers.
Go through your competitors' content and sites with a fine-tooth comb and pay attention to details like prices, products and services, and how they deliver their finished products. However, remember that just as telling are those less tangible aspects: their language, brand persona, and how they use design and content to portray themselves. Even a cursory browse of a competitor’s website to review SEO or search engine results can be a goldmine of information.
Website Tips: Ask yourself: How does your site stack up in comparison? Are they using any inbound marketing methods like blog posts, email signups, or lead magnets (requesting your email address in exchange for a free document or resource)? Look at how your competitors engage with people through their websites, and see if you may be behind the pack. Reviewing every piece of content will give you a more well-rounded picture.
You can learn much from competitors’ social media profiles, which often connect to their websites. The competitors’ social media content, on platforms such as Facebook, Twitter, Instagram, LinkedIn, etc., can clue you in on their most recent news and upcoming offers. Even more importantly, it can help you see how they use social media to engage with their customers.
Asking yourself questions about competing organizations’ activities may also be enlightening. Then, use what you uncover to assess your social selling and social networking skills to create a compelling, practical picture of how you could use social channels.
Social Media Tips: Review the social platforms they use and consider the following questions:
- Are they a good fit for these platforms?
- What type of content and images do they post?
- How do they use language; is it stuffy and formal or chatty and upbeat? Do they use social media to deal with customer service issues?
- Do they engage with users through specific features like digital marketing, paid advertising, polls, or groups?
Besides competitors’ social media and website presence, you should find out where your competitors advertise. Then, review the methods they use to get their name out there.
Websites that offer frequent free business listings provide a wealth of information and usually have a function for customers to leave positive or negative reviews. So, read your competitors’ customer reviews and comments to see what they do well and what they do poorly from a customer’s perspective. If they use a third-party review site (such as Yelp, Reevoo, or TrustPilot) for customer comments, that’s also worth a look.
Promotion Tips: How are your competitors spreading the word about their products and services? Do they advertise in industry magazines, use pay-per-click advertising, or distribute flyers? Look at the things they promote, whether offers, new lines, or something else entirely. These are other valuable ways to learn from your competitors.
Competitors’ Level of Service
By reviewing competitors’ websites, social media profiles, and visibility, you can gain insight into their level of service. It’s well-known that customer service can make or break a company. In fact, 61% of consumers are more likely to go to a competitor after they’ve had a poor customer service experience.
Consider the following questions about your competitors:
- What extras do they provide as bonuses to entice people to buy?
- Do they have person-operated 24-hour phone lines?
- Do they offer free no-quibble refunds? A free trial period? Full technical support?
Bonus elements like these help to sweeten the deal for potential clients. Your next task will be to determine how to adapt these “sweeteners” to improve your business offering.
Service Tips: Do clients ever ask if you provide a complementary product or service you don’t currently offer? Do your competitors offer this service? Perhaps it is a new product or service you could introduce at some point. Next, research why you aren’t offering similar products, and determine your ability to provide them and do them justice.
Competitors’ Mess Ups
Just like humans, all companies occasionally experience mishaps. One of the most valuable lessons you can learn is tied to “oopsie” moments. Rather than taking chances and learning from your mistakes, see if competitors have already made those mistakes for you. You can learn a great deal from how competitors messed up and also how they handled it.
If a client has come to you after a poor experience with a competitor, they might be frustrated enough to reveal a few details of how things turned sour. You can get insightful information by engaging and empathizing with them, no matter how vague or seemingly inconsequential. Word of warning: never push for information — not everyone wants to dish out the dirt!
Mistake Tips: Unfortunately, things can go wrong on your end, too, causing a client to seek out your competitor. It’s not easy to know how to respond to customer complaints effectively. If this happens, ensure you analyze the person’s case, pinpoint what went wrong, and learn from any mistakes. If you act fast, you may be able to make amends before it’s too late.
Competitors’ Email Marketing Campaigns
This may sound sneaky, but it’s not a bad thing — it’s nothing more than good market research. Go to your competitors’ websites and social media platforms and determine if they use email marketing. If the option exists, sign up for their email updates (you can even use an anonymous email address). Chances are you’ll get a sneak peek into their lead nurturing strategy.
After subscribing to their email list, gauge their response tailored to potential customers. If they don’t respond for weeks or even months, it’s clear they’re not using email marketing to its full effect. However, if you hear back, analyze what they’re promoting and the language they’re using, just as you did in our previous steps.
Email Tips: Effective email marketing requires frequent campaigns for a customer base. You can get ideas of what to do (and what not to do) by opting in to receive competitor emails. Use this information to your advantage and ensure your campaigns beat the competition.
Competitors’ Lack of Services
We’ve spoken a lot about competitor analysis: looking at what others are doing and seeing what you can emulate. But at the end of the day, you must remember your strengths. Use surveys, previous feedback, and objective thinking to get an accurate warts-and-all picture of your company and where you stand in the competitive market.
Don’t focus solely on your strengths versus competitors’ strengths. You can work with both to provide something that’s purely yours. Be sure to monitor the metrics that matter and use a CRM to help you fix customer pain points.
Lack of Services Tips: It should go without saying never to copy a competitor outright. After all, that company may be doing something poorly compared to you.
Entrepreneurs and startups face all types of risks and resulting lessons, especially those you get after making mistakes — hopefully, you don’t repeat them. The good news is that you can prevent some errors by looking at your own business competitors and learning from others in business. Whether you examine their website, content strategy, social media profiles, promos, services, emails, or anything else, it’s vital to take the time to learn from your competitors.
Note that good market research is never a one-off deal. Continually evaluate and enhance your efforts every so often by looking at yourself and your competitors. The best and most successful businesses are constantly looking for ways to improve, and you should be too!
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Q: Why is it important to learn from your competitors?
A: Learning from your competitors can provide valuable insights into their strategies, successes, and failures. It helps you understand market trends, identify opportunities, and refine your own approach to gain a competitive edge.
Q: How can I effectively analyze my competitors?
A: To effectively analyze your competitors, consider these steps:
- Identify your key competitors in the market.
- Research their products, services, and pricing strategies.
- Analyze their marketing and advertising campaigns.
- Assess their online presence and social media activities.
- Study customer reviews and feedback about their offerings.
- Monitor their industry partnerships and collaborations.
- Stay updated on their latest news and announcements.
- Compare their strengths and weaknesses with your own.
Q: What can I learn from my competitors' successes?
A: By studying your competitors' successes, you can gain insights into their effective strategies, innovative approaches, and best practices. Analyze their successful marketing campaigns, product launches, customer acquisition techniques, and unique value propositions. Identify the factors contributing to their success and consider how you can adapt or improve your own strategies based on those learnings.
Q: How can I learn from my competitors' failures?
A: Learning from your competitors' failures can help you avoid making similar mistakes and capitalize on the opportunities they missed. Analyze their unsuccessful product launches, marketing campaigns that didn't resonate with the audience, or customer service issues they faced. Understand the reasons behind their failures and use them as lessons to enhance your own business operations, customer experience, and strategic decision-making.
Q: How can I differentiate myself from my competitors?
A: To differentiate yourself from your competitors, focus on the following strategies:
- Identify and highlight your unique selling points.
- Offer superior customer service and support.
- Provide innovative products or services.
- Personalize your offerings based on customer needs.
- Build a strong brand identity and reputation.
- Continuously innovate and stay ahead of industry trends.
- Leverage technology to enhance efficiency and convenience.
- Create a positive and memorable customer experience.
Q: Is it ethical to learn from my competitors?
A: Learning from your competitors is an ethical practice as long as you do not engage in any illegal or unethical activities. The purpose is to gain insights, gather information, and understand the market landscape. Respect intellectual property rights and abide by legal and ethical standards in your competitive analysis.
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