10 ways to pinpoint who your competitors are and how to find out about them
Competitors are like icebergs. Some are highly visible while others are hidden. How do you identify hidden competitors? And once they're identified, how do you find out about them?
Charles Revson, founder of Revlon, proclaimed, "In the factory, we make cosmetics; in the drugstore we sell hope." In other words, Revson defined his company's products in terms of customer benefits, not product categories.
To identify hidden competitors, ask your customers what benefits you provide them. Then ask them:
• "What other companies did you consider?"
• "What problems do you want to solve in the future?"
• "What companies could help you solve these problems?"
Also, do your own brainstorming. Once you have a list of competitors, scour resources to find out more about them, such as:
Annual reports: To understand what the numbers mean, study the sections on marketing and competition, as well as the footnotes. Besides slower sales, a decline in earnings could mean heavier investment in research and development, or the launch of a new product or service.
Regional and local business publications: These are good sources of information on lower-profile, privately held companies. Look for real estate news; commercial property deals often signify expansion or contraction or a redirection.
Partnerships and acquisitions: Has your competitor formed new partnerships with its competitors, suppliers, distributors, or customers? Will the competitor gain access to technology, talent, customers, brand names or new markets?
New hires: What new technical and business expertise are your competitors seeking? For example, if a biotech company hires a vice president who has led a software business, the biotech firm may be planning to commercialize software originally developed for internal use.
Conferences, seminars and webinars: What new products or technologies are your competitors talking about?
White papers and case studies: How has your competitor responded to industry breakthroughs? From your competitor's white papers you can deduce how they view new technologies. From their case studies, you'll learn how customers are using products based on new technology.
Patent disputes and applications: Have your competitors filed new patent applications? Are your competitors involved in patent disputes? To obtain patent information, consult this page at the U.S. Patent and Trademark Office: www.uspto.gov/patft/index.html.
Research papers: Are your competitors publishing research reports on their website or in journals? For example, research papers buried deep within the Hewlett-Packard website describe some of HP's new technology.
Company news: Are your competitors forming new divisions or spinning off existing divisions? In November 2013, Harvard Bioscience of Holliston spun off its Harvard Apparatus Regenerative Technology (HART) division, which regenerates organs for transplant. Competitors might wonder about the impact of the spinoff.
Blogs, Facebook and Twitter: What is the blogsphere saying about your competitor? Check social media postings.
As product categories blur, identifying and following competitors have become more challenging than ever. Assign someone to identify and monitor your competitors. Give this person enough time and resources to do the job. Then, interpret the data you have gathered, and decide whether and how to respond.
Ruth Winett is owner of Winett Associates (www.winettassociates.com), which provides research and writing services to growing companies.
WBJ Web Partners
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