Is Your Competition Your Best Friend?

We are all "market researchers" to varying degrees. Whether we are looking for new suit or a new friend we take in and analyze lots of information. We analyze this information both consciously and unconsciously. When we are buying a suit we may consider the price, the material, the cut, the sales person and the store where we are making the purchase, the colour and more.

If you think about it, we do the same thing when making friends. We consider such things as similar interests, personality, sense of humour, physical appearance, gender and age just to name a few issues. Market research for business utilizes many of these existing analytical skills in a more formalized manner.

I deal with small business operators on a daily basis in my profession. One of the basic questions I will ask is "how do you stack up compared to your competition?" More often than not people haven't thoroughly compared themselves to their competition.

Some people feel a little uncomfortable checking out the competition. If they have research their business competition then they rarely actively re-evaluate themselves versus their competition on a ongoing basis. My response? If you already do a thorough analysis on what suit you are going to buy or who you will befriend why not use these existing skills for the benefit of your business?

When carrying out market research, especially involving your competition, use proper ethics and good taste. Behave in a way that follows principles of good ethics and fair business practises. If you are unsure of common business etiquette or fair practises contact your local Chamber of Commerce or your Industry Association for some direction.

Competition Watch How Numbers Matter

I managed a small ski resort for a number of years. We had two competitors nearby that offered good services and products. To access help "market share" we would send count the number of cars in our competitors parking lots on weekends and random midweek days.

By market share I mean the "total number of units of a product (or their dollar value) expressed as a percentage of the total number of units sold by all competitors in a given market". Got that? Here's another way of putting it: we wanted to know how big our slice of the pie was compared to our competition.

Gathering information about market share can sometimes be difficult and sometimes fairly easy. Be creative when determining market share. Often your competition will show you the way. In this case, your competition becomes your one of your best friends.