But this year, I urge you to consider a useful new January habit. I think it’s time to make January your “Competitor Month”.
Let's face it, most of us take our competitors for granted. We’ve been rightly taught to focus on our own opportunities and not to obsess about them, so we note who they are in our strat plan and leave it at that.
This isn’t wrong, but it does assume that our competitors stand still. Which of course is nonsense, as our markets are continually evolving around us.
Keeping track of competition over time is a strategic discipline we all need to adopt. Every change in a competitor’s product or positioning directly impacts the way we too are perceived by our customers. So unless we are aware of our market, we risk being repositioned by stealth.
Quick question, when was the last time you formally checked in on your competitors? Exactly! In my opinion, competitor tracking is so important it deserves its own Standard Operating Procedure. But before you rush off and set up a process, let’s pause to reconsider what a competitor actually is.
We’ve all drawn up a list of competitors in our planning workshops and after some prompting that list is usually rather long. So we break it down into practical segments; perhaps direct competitors vs indirect competitors, geographical regions or premium value segments.
Every business must model their own competitor segments, but remember that this model is not your practical competitive set. Why? Because customers don’t consider the whole market like we do, they build an instinctive shortlist of solutions.
Hence the only competitors that matter to you are the ones that your customer might seriously consider alongside you.
To set this shortlist, we first have to reframe to see the market through the eyes of our ideal customer. I like to drop the word “competitor” entirely and think of them as “options”. After all, your customer doesn’t describe competitors, but rather potential options that intuitively meet their needs.
To test this in action, take a moment to ask a colleague this question; “when our customer is deciding what to buy, what options do they consider?”
Because of the psychology of choice, you’ll find that the answer is usually a very short short-list! I have a magic rule of 3 here, your direct competitors are the three options your ideal customer would choose from if you weren’t there.
So the magic 3 are the only competitors worth tracking throughout the year and the ones you must compare your product to in detail. Remember to keep describing with the perspective and voice of your customer, noting which attributes or features are mandatory or exceptional.
It’s helpful to track these competitors throughout the year, noting changes to product, channel, price and promotion. Finally, repeat the whole exercise annually to decide if the customer's shortlist needs to be updated with a new entrant.
I’ve read some interesting articles recently about the value of AI tools in automating some of this work and I’ve got some experiments in play myself here. I’ll let you know how they go and make recommendations in the coming months. In the meantime, don’t forget how useful Google alerts can be for tracking. Useful doesn’t have to be hard!
So there you go, why not make January your Competitor Month and get your team on top of this vital practice. If you’d like more detail on the topic, practical advice or access to some of my handy checklists, feel free to drop me a note or come along to the next clinic. ⬇️
