In the business world, the presence of competitors seems unavoidable, where every business that is built must have its own competitors. Even if you offer a product that is the only one, there will surely be competitors.
Competitors can be good or bad depending on how you judge them, you need to know more about what competitors are so you can judge them well.
Do competitors pose a threat to your business? Or become a benchmark to further improve the products or services offered?
Understanding What Business
Competitors Are A competitor is one or more companies that offer products or services that are similar to your business. However, that does not mean that all the same businesses are competitors. In other words, the companies are the same size and scope.
For example, a well-known fast food company, McDonald’s, is well known and has a wider scope. In your opinion, who are the competitors of the company? KFC, Burger King or D’besto?
The answer is that KFC and Burger King are competitors from McDonald’s, why not D’besto? Even though the company sells the same product? Because, D’besto company does not have the same size and scope (starting from the target market and price) as McDonald’s.
However, both target the same consumers with the aim of meeting consumer needs. Therefore, it is the consumer who will decide which product to choose according to his needs.
So you must have the perception and view that competitors are the starting point of business development. The existence of competitors makes it a challenge and motivation to be even better. All preparations are needed so that the business can run and win the existing competition.
3 Types of Competitors to Be Aware of
After understanding what competitors are, here are 3 types of competitors that you should know.
a. Direct Competitors Direct
competitors are competitors who are business competitors whose products, markets, industries, and prices offered by the company are the same as those of their competitors. Examples include food companies Pizza Hut and Domino’s Pizza.
They are direct business competitors, both making the same product and target market with their own characteristics.
b. Indirect Competitors Indirect competitors
are companies that sell products that are not the same as yours but offer the same solutions that your customers need.
They have different products but can be an alternative as a substitute product. For example, the Tong Tji tea company and the Nescafe company, both sell different products but provide the same solution for their consumers.
c. Shadow Competitors (Replacement Competitors)
This type of competitor is offering different products and objectives but has the same target market.
For example, salons and beauty clinics, the difference is that salons provide services for mild facial, body and hair treatments. Meanwhile, beauty clinics provide services in the form of treatments that can enhance beauty with medical procedures and sophisticated equipment.
Beauty clinics usually have the supervision of a general practitioner who has attended training for a certain time. While salons are usually supervised by ordinary people (no media education).
Triggers to Compete Your Business with Competitors
So that your customers remain loyal and don’t switch to other companies. Understand that some of the triggers for your business to compete with competitors.
a. Similar Products or Services
Business competition can occur because competitors feel they know more about what consumers need than companies that have existed before.
That way they can come up with products that can answer consumer needs by launching similar products.
b. Targeted Market
Sometimes a company that is in control of the market doesn’t know what competitors are from the start and doesn’t anticipate small changes happening around it, so they choose the wrong target market. As a result, the strategy implemented actually made him lose his main market and instead moved to its competitors.
c. Business Location
Another gap that competitors can enter is an error in determining the location of the business. Making quality products is not enough, a company must also determine a strategic location.
d. Implemented Business Strategy
There are several companies that have almost similar business strategies, namely McDonald’s and KFC. Most of those who choose KFC, definitely come there to eat the fried chicken.
Meanwhile, McDonald’s consumers mostly come to eat burgers and various types of wraps, as well as ice cream. The difference in the size of the product is also an advantage. KFC fried chicken tends to be bigger than McDonald’s.
The Role and Benefits of Presence of Your Business Competitors
Understanding what competitors are makes you understand why companies need business competitors. The following is the role of competitors for businesses to encourage you to do your best and compete in a healthy manner.
a. Market Mapping & Brand Positioning
With competitors, you can start by developing a market map as a step for more in-depth research into who will buy your product.
And you can get to know the uniqueness of what your company will provide. Although it is quite complicated to do because there are so many competitors, so companies must be able to make consumers fall in love with their products because of the unique impression that the product has.
b. Product & Service Development (Development)
After seeing competitors, you can do in developing a product, namely improving the old product or adding the usefulness of the product to the target market.
Product and service development is a process and strategy that needs to be done. This means, you need to present new elements that can captivate customers.
c. As a Benchmark in Setting Targets & Strategies
Benchmark is an effort to measure company policies which include products, programs, strategies, and other things by comparing with the company’s competitors.
This is done in order to get information about what needs to be improved starting from targets and strategies to improve company performance.
d. Triggering the Emergence of Innovation in Marketing Strategy
The existence of competitors triggers the emergence of innovation. Innovation has an important role in running a business.
Many successes are obtained by business people who start with their creativity and find innovations in developing their business products.
If business people are able to maximize creativity to give birth to an innovation, the managed business will also be able to appear different.
e. Indirectly Also as Motivation
The presence of competitors can be treated as a positive thing, one of which is by making their presence as a motivation. So, you will be motivated to always and continue to give the best.
Business owners can also evaluate and find out shortcomings that consumers don’t like. Improve service, maintain product quality, and create the latest innovations whether launching new products or simply providing offers that benefit consumers.
Knowing Competitors is the Key in Business Competition
One of the keys to the development of a company, and to be able to survive for a long time, is to know what competitors are and the character of the business competitors they are facing.
If you already understand the scope of the business, you can survive in a competitive world, you must be able to see opportunities well. Understanding competitors in detail will be very beneficial for the business.
Your business will continue to look for opportunities and strategies so that your company will increase innovation and become a superior company. Do an evaluation of the company’s performance with competitors.
This is an impetus to maximize the company’s performance well which will have a major impact on the increase in the profits you get.
Tips for Winning the Competition with Competitors
How do you set a strategy to win over competitors? Here are tips to win the competition with competitors.
1. Highlight Product Advantages
Understand what competitors are and focus on highlighting the advantages of your product by maintaining the excellent product or service quality that you have been offering to consumers, so as to increase consumer loyalty to your product.
2. Learn Competitors Strengths and Weaknesses
Learn about your competitors’ strengths and take advantage of competitors’ weaknesses as an opportunity to win the market. Create new products or provide services that competitors cannot. So the opportunity for you to win the market will be more open.
3. Keep Innovating
In order for product quality to continue to grow, you need to understand what competitors are and apply innovations regularly. Moreover, today’s business world is changing very quickly with various existing trends.
Therefore you must be able to develop products to stay relevant. After all, what the consumer buys is the product you sell. If the quality of the product does not match what you are selling, the consumers will turn to competitors.
4. Expand Market Reach
If your current customers are loyal customers, you can expand your market reach with new target markets which can lead to faster and better growth. However, make sure your business is ready to target the offering tailored to each target market.
5. Provide the Best Service
Customers will use their personal experience to differentiate your company from other companies. Usually, consumers will switch to another company if they get bad service.
So, the better the service provided, the more consumers will be interested and maintain their loyalty.
Competing with competitors does not always have to bring down and harm other parties. You have understood what competitors are so you can attract their customers by implementing effective ways.
Healthy competition with competitors will encourage you to continue to learn and develop your business to be better prepared to compete in the future.