Understanding what the competition is up to is something that many business owners overlook.
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It's easy to do, given all of the pressing matters involved with starting and growing a business. But you have to make the time to do it, especially when you are putting together the company marketing plan.
Here are are few important things to cover in the marketing plan competitor analysis section:
- Names of competitors - At first glance, this may seem like an exercise in list-making. Obviously, if you sell ice cream by the cone, your competitors include other ice cream vendors. However, you're also competing with other dessert treats offered by grocery stores as well as other items competing for consumers' discretionary funds. So, list all of your competitors and include information on any that might enter the market during the next year.
- Summary of each competitor's products - This summary should also include their location, quality, advertising, staff, distribution methods, promotional strategies, customer service, etc.
- Competitors' strengths and weaknesses - It's important to see your competitors' strengths and weaknesses from your customer's viewpoint, not yours. List their strengths and weaknesses. State how you will capitalize on their weaknesses and meet the challenges represented by their strengths.
- Competitors' strategies and objectives - This information might be easily obtained by getting a copy of their annual report. Probably, however, you will need to do some detective work or conduct an analysis of many information sources to understand competitors' strategies and objectives.
- Strength of the market - Is the market for your product growing sufficiently so there are plenty of customers for all market players? Or, is the market so tight you are selling primarily to your competitors' customers? (If so, you need to have a strong competitive advantage.)