One common mistake companies make with doing competitive research is asking the wrong questions. They’re asking “apples to oranges” questions. For example, they might be a company with under $10 million in revenues, yet they’re comparing their strategy to a Fortune 500 company.
In order to get good market research data that can actually be implemented to help drive the course of your business, you need to ask “apples to apples” questions.
Start by defining exactly what you want to find out. For example, you might try to determine how your competitor is able to offer a lower price while keeping profitable. Or you might try to figure out how well your competitor is doing in a certain market segment.
Once you know what you want to find out, then it’s time to craft the right question.
==> Crafting the Right Questions
The goal of the right questions is to figure out what they’re doing that’s the same as you and what’s different. If they’re getting different results, chances are they’re doing something different than you – and they’re doing it right.
Some potential questions include:
* What does their sales funnel look like? (Web traffic to phone call to lead to sales to backend, for example.)
* What niche markets do they cater to? Why do they or why don’t they target specific markets?
* What’s their customer service or product philosophy? What’s their company culture?
* What do they offer that we don’t? What do we offer that they don’t?
* What channels do they advertise in? Are they effective?
So on and so forth.
==> Creating a Plan of Action
The goal of asking these questions is so that you can create a plan of action.
Weed out any answers that come from the two of you being fundamentally different companies. If you’re a face to face sales organization while they’re a web marketing organization, you don’t want to use their sales strategy. That’s not an “apples to apples” comparison.
Instead, take all the answers to your questions and look for things that you can actually implement. Also, look for weaknesses in your competitor’s strategy to see if there are any gaps you can exploit.
Then formulate a plan of action. Don’t get stuck in research, research, research. Research does not improve your bottom line. Aim to do enough research to identify new opportunities, then immediately shift your attention to creating next steps that can take advantage of that data.
Asking the right “apples to apples” questions will allow you to identify what your competitors are doing right and what they’re doing wrong. It’ll allow you to not only spot differences, but also identify actionable ways to move your company forward.