Competitive intelligence will help you better target your customer, know exactly what you and your competitor’s strengths are and tell you when to stop chasing a potential client.
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In the quest to win and retain business, it will save you time and money.
Competitive intelligence is about analysing where your business fits in the market, what competitors are offering and how they – and you – see those offerings matching clients.
It is about understanding the process in the market including how your competitors stack up against you in terms of:
- ways of engaging
- key staff
- key consultants
- expertise.
Zaun Bhana, Managing Director of Leap Consulting, says when you’re engaging with a customer and find out a competitor is involved, competitive intelligence will help you work out if there’s actually a competitive situation and how to manage that to either win the business or to stop trying in that area.
“So, if you’re bidding on a tender, a lot of times an organisation is trying to break into new accounts,” Bhana says.
“If the competitor is in there, why are they in there? Are they good at a particular service and have expertise in that? If that’s the case, if you try to go in with the same service, there may not be enough differentiation for you to break that chain.”
Bhana says the more you know about the competitors you come up against, the better positioned you are to make judgement calls.
“The other side is, sometimes it allows you to go ‘well if this customer is wanting this type of service, this provider will be their number one choice’, so it might not be a successful engagement,” he says.
“Sometimes, competitive intelligence allows us to say no or walk away from opportunities as well.”
You do need to be careful when using your knowledge about your competitors, Bhana says.
“You might go after the same market section as someone else, but the product is a loss leader and maybe the competitor is using the product because there’s a bunch of services behind it,” he says.
“Alternatively, if you learn a competitor is at a price point, but you don’t know what went into that price, you could end up in a position where you’re losing money if you try to match it. Your competitor may be getting supplies at a certain discounted rate so they’re still making a profit, but you don’t have that supplier rate.”
You should start to gather competitive intelligence when you’re clear about where your market is, then you can narrow your search and information gathering. Existing businesses should already know their market.
The most basic sources of competitive intelligence are your own time. Networking at industry events and participating in industry briefings are good ways to get an understanding of the dynamics of your industry.
It also helps create peer groups or meet companies in the same industry but different market, such as interstate.
Research the internet to find strengths and weaknesses of your competitors as well as make comparisons.
After this, Bhana recommends moving to the second stage, which is looking at industry metrics and outside help.
“You could start to use a researcher and look at all the potential competitors in the market and what their servings are. Then you can engage someone to do full research and just spend six months looking at all of these things,” he says.
