Even if your brand or company is offering a great product, your product can die out if your competitor performs better. Knowing your competitors and comparing them on different parameters is an important part of any marketing campaign. And we all know that one of the best ways to outrule your competition is by knowing how to do market research the right way!
While there are various market research solutions that provide you with information that you must know to become better and different, are mostly not of much use as they don’t carry your perspective of the market.
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Understanding direct, as well as indirect competition, can decide whether the business model can sustain in the top position or it requires alteration.
A brand does not exist in a vacuum
Appraising the activities of your competitors and comparing them is a crucial part. You can monitor your competitor’s presence on social media, look at the marketing campaigns, and then involve your energy in outdoing. Further, here are a few tips to help you determine how to do market research with a better perspective,
1. Identify the Major Players
While thinking about the present and the potential competition, a rapid way of answering the basic questions is referring to the 5 Forces of Michael Porter, which covers the following key segments,
- The threat of any new entrant
- The threat of any substitute services or products
- Bargaining power of suppliers
- Bargaining power of customers
- Competitive rivalry
Considering the key players along with the potential threats shall prepare you to compete for a long-term. Huge profitability in any market segment would attract new firms and new entrants would eventually decrease the profitability of other firms. You must ensure that if you are trying to make your mark in the market, either you make the entry of the new firm difficult by incumbents or focus on gaining a stable profit margin that’s necessary to keep an industry in business.
2. Go SWOT!
Competition is not a problem but a resource too. Understanding the ups and downs of your competition can help to decide what can make your company successful. Different syndicated analysis and reports identify the key leaders and offer a thorough assessment of the business strategies of the companies. Use these along with other research project reports to have a clear examination of SWOT analysis.
Make a grid together with the major benefits a customer receives from your services and products at the top. Then make a list of the direct and the indirect customers. Fill in the respective details offered by the competitors. This is a simple job and it can say you what the competitors are offering but you are not, and vice versa as well.
3. Learn From the Mistakes
There are many companies that have changed the business strategies or have completely failed. Study the business failures so that you can avoid them. Determine the factors that led to this problem and the decisions that did not resolve the issue. Knowing the reasons that caused the businesses to fail shall help in avoiding similar mistakes.
4. Use the Target Market to Your Benefit
You must have a perfect definition of the target audience (You may refer to How to Find Your Target Audience on Social Media if you are trying to target your business online). The opinions matter. You can perform different research including checking various social media accounts, contacting the employees who remain in contact with the customers including the sales representatives.
You could also try researching your customers via surveys. When you get feedback from them, you can decide whether your company is worse or better than your competitors. Regardless of the information, market research shall guide you ultimately to the data that you require for making your business a successful one.
5. Perform A/B Tests for Behavior Analysis
If you have the idea about how your customers shall react about a particular product, option or layout then test it with the online customers. You might invest in an A/B testing software or just run a Facebook campaign with A/B testing, which shows you two projections of the behavior interaction.
These projections would eventually help you get a handhold on your marketing campaign. In the long run, A/B tests are highly effective compared to incorporating changes to your website UI/UX or playing around with the brand image.
6. Collect Data & Formulate a Plan
Once you develop a concrete question that you want to address, its time to formulate a plan. In the modern digital era, there are three kinds of data sources:
- First-party: This is the data collected about your business or customers
- Secondary-party: This is the data collected by another brand about the business or customers.
- Third-party: This data is purchased by the companies. It is not about the brand or their customers.
You may refer to various online channels like social media networks, forums, online blogs & roundups etc to collect targeted data sets.
7. Identify Industry Competitors
If you are small and dream to be the best, you must initially chase the best. A crucial part of how to do market research is following the market leaders and eventually be one. Your definition of a market leader can be different than the ideal one, but in my terms, you should always have more than one competitive figure in your industry.
For eg, If there’s a competitor A making the most profit in the industry, there might be a competitor B having a majority of the user base. Now, it’s your job to tweak yourself to out-compete both.
Look at the common themes that say a story and create a list of the items about which you need to act. To make this process easier, use software to prepare a report. This will help you to add diagrams, quotes, or call clips.
Conducting market research is a great experience. Even if you think you know the buyers very well this shall help you to uncover new messaging tips and new channels that can improve your interactions.
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