7 Reasons Why Market Research & Competitor Analysis Are Important For Your Business.

7 Reasons Why Market Research & Competitor Analysis Are Important For Your Business.

1. Positioning Yourself in The Market & Establishing USPs. 

Contrary to popular belief, you don’t need a huge marketing budget to establish yourself in your market. You simply need to identify the core traits that differentiate your business and work that to your advantage. What is it that makes your company special? What can you make or provide that no one else can? Twist the business model on its head and picture yourself as the customer – what do they want or need? What problem do you solve for them? You need to know almost everything about your perfect customer; what makes them tick? What do their daily lives look like? Where do they hangout? Make a promise like FedEx does – to deliver customer’s packages on time, any time. Just make sure you can fulfill your promise!

2. Finding New Markets

Business needn’t be traditional and trapped in rigid markets anymore. Swap and change if needs be; work with the ebb and flow of consumer needs. If your business is moving in the opposite direction to your market, don’t panic! Just redefine your business model and strategy to work in a different market. Of course, risks will be involved but don’t worry if you don’t get it right the first time, or even the second. Making mistakes is part of the learning curve and every mistake has a value. You just need to make sure that you take the time to reflect on the mistake and learn from it. Hopefully you will have done enough market research and competitor analysis to eliminate as many risks as possible, so finding those new markets will be a walk in the park. Take McDonalds for example. They’ve gone from being a fast food chain to a rebranded “modern, progressive burger company” so they can benefit from the issues that matter most to their customers e.g. sustainability and social purpose. They could have stuck with selling burgers and chips but if there’s room for change, then go for it.

3. Learning From Your Competitors Mistakes & Successes

Competitor analysis is not about copying other businesses; it is understanding what they’re doing and how you can do it better. The ride-sharing service Uber blindsided the complacent taxi industry, disrupting it permanently by learning from their mistakes. An easy way to do this would be to subscribe to your competitors email updates or newsletters to get a glimpse into their marketing strategy, or set up Google Alerts which informs you when an article is posted about a specific search term e.g. your competitor’s company name.

4. Strengthen Your Marketing Strategy

A successful business will have a marketing strategy that underpins every move.  A knock on effect will occur once you have this backing you up, because whereas you might have hit a brick wall before, now you can open doors into new opportunities and challenges.  An ongoing tip to strengthen your strategy is to be creative. Work with your markets to think of products that will excite your customers; Dunkin Donuts and Domino’s have created dry pork and seaweed donuts for China and curry-topped pizza for India, respectively!

5. Understanding Your Audience & Creating Better CTAs (Calls to Action)

A Call to Action is where the magic happens. Get it wrong and the conversions will grind to a halt. Each email, newsletter and other communication should give the recipient a chance to connect with or buy from you – use them appropriately, though. Don’t say ‘Happy Birthday’ to a customer and add a ‘Buy here’ message, but you can tweet about your forthcoming Birthday Spa Deal with a ‘Click here to find out more’ message.  Dropbox hits the nail on the head with its CTA’s. They implement a clear & simple design with the on-brand blue “sign up for free” CTA that stands out from everything else.

7-reasons-market-research-competitor-analysis-important-business-dropbox

6. Understanding the Share of the Market (Supporting Business Plan/Loan Applications)

Although not critical, it helps to have a business plan which contains sound reasoning and is well thought out. The only way to get a grasp of that is to understand the share of the market. The share is made up of dominant companies, and the smaller businesses, within your market. Identifying this will enable you to know where you will sit thus, giving you a clear picture of what plans you need to make.  It can help with banks and lenders when or if you apply for a loan.

7. Discover Your Own Weaknesses & Start Developing Them

Future-proofing your business and anticipating what’s round the corner for your industry or sector is crucial to heading off would-be problems. By breaking down a weakness to find the root of it you can get an understanding of how it happened. But the only way you can learn to do this is by making mistakes, which every single business will have done at some point in the past. It’s okay to fail! Remember, it’s your First Attempt In Learning! But it’s not okay to give up because of it. Everything in business, and in life, is a valuable lesson where inspiration can be drawn from, if you really look.