Discover more about your direct competition and your ease of entrance into the market.
- Now it's time to talk about new markets and how you're going to approach your competition. Every company wants to enter the market with a competitive advantage. To ensure you have an advantage in your new market, you want to first create a competitor profile. So what kind of data can you gather for your competitor profiles? Number one is recorded data that's obtained externally in the form of published sources. Published sources include your competitors' product brochures, promotions, news articles, and annual reports distributed by your competitors.
The quality of the information will help you to be more competitive and to also give you an advantage with customers right from start. Number two is the witness or observed data. Some good sources of data you can observe would be what you see when you go to a trade show and visit a competitor's booth, or the conversations you uncover through social media that customers are having about the competition. Number three is your ability to gather plan data or your effort to set up opportunities to learn more about your competition.
For example, you can conduct interviews and have discussions coordinated with different partners, suppliers, or people who have relevant knowledge of your competition. Maybe even former employees. Next, it's important to understand your new market based on how others will compete with you. Here are several market factors that really need your attention. These five forces were developed by Michael Porter, an academic and business strategist.
First, you need to think about the barriers to entry that would prevent you or someone else from entering into this market easily, such as high start up costs. Second, are there any threats that you should know beforehand? A threat would include a company that may not be considered a direct competitor, but one that has a substitute product, especially if the substitute is cheaper. A good example would be butter versus margarine. Third, you will also have to think about who has the bargaining power in the market.
If a supplier has the buyer power, then they can drive up the prices, which would reduce you company's overall profit. Four, what about income level of your consumer? How will they be able to afford to buy your product? This is called consumer buying power. High buying power means they have higher incomes. Of course, this affects quantity supplied and quality of the product. Fifth, you should always consider competitive rivalry and the strategies and tactics used by the competition to capture the time, attention and the purchasing behavior of your customers.
Your competition is actively trying to steal your market share and profits. Knowing the competition in the market is a big part of a successful, go to market plan. Now you're ready to find out more about the competition, how they operate, and how well you'll be received when you enter the market.
- Building your go-to-market (GTM) plan foundation
- Assessing whether you need a marketing or GTM plan
- Entering new markets with a competitive advantage
- Developing your product vision and message
- Setting your product price at launch
- Setting up your channel strategy
- Driving better channel performance
- Evaluating KPIs and metrics
- Storytelling and the customer journey