Learn 5 steps on how to conducting market research. What would entrepreneurship be without competition? It would be wonderful if I had a monopoly in my industry. Unfortunately, that won’t be the case with you either.
You can fathom your competition and conducting market research using similar sources as in market analysis.
Through the collected information about the market, it should be easy for you to present your competition and thus estimate which further offers there are still in your industry.
With a competition analysis, you will get to know your competitors better and you will be able to assess them better.
It shows you not only the number and type of your competitors but also their strengths and weaknesses. This is enormously helpful for your positioning. So let’s start step by step!
Step 1: Choose the right competition for conducting market research
Do not analyze all competitors at once, but concentrate on three in the first step.
It is a good idea to choose the closest competitors and consider what market position each of them has.
If you haven’t yet looked at who the market leader is as part of the market analysis, you should take this opportunity to do so.
Step 2: What do you want to analyze when conducting market research?
However, it is not only important to know who the market leader is, but also why it is. During the research, highlight the strengths and weaknesses of the competitors.
In this way, you will find starting points for what you can do better and where you need to catch up right from the start.
- the price, the products offered,
- the marketing,
- the service or the distribution channels.
Step 3: Collect and evaluate information
Collect this information and get a comprehensive overview of the competition.
You can also use a chart here to assess the competition and yourself against these variables.
In this phase, you should immediately obtain information about the competition, which can be useful for your later marketing planning.
Why is the market leader the market leader and what does it do better than everyone else?
In benchmarking, you analyze the top performer and try to close the gap between him and you.
By always orienting yourself towards the market leader, learning from him and continuously improving accordingly, you create competitive advantages for yourself and can strive to become the market leader yourself.
Benchmarking can be carried out with any characteristics.
Often, factors such as time, quality or costs are identified as the basis for your own evaluation.
Keep in mind, however, that this is not about imitating and copying your competitors. It’s about using your resources and skills most effectively.
The real goal is to find out where and how you can improve your strategy.
Each of us would like to have information about the competitor.
With the tool Similarweb this works quite simply and to a certain extent even free of charge. Simply enter the competitor’s domain into the search field and get an estimate of the monthly page views, from which source and which countries they come.
But the best function is the listing of similar websites and competitors.
This gives you a quick overview of your own market.
Conversely, this function can be used to find other cooperation partners that are similar to the current ones. It is important that your competitor has a certain size so that enough relevant data can be collected and evaluated.
The first step in the art of benchmarking is to select an area you want to look at more closely.
This could be the processes, the product or the marketing activities. With a high probability, it is a discipline in which you see a need for improvement.
In any case, it is advisable to define this area concretely in order to be able to identify larger and, above all, clearer improvements.
Once you have defined what you want to analyze, you need to select the best competitor you want to measure yourself against. Make sure that the dates are comparable so that you can set a benchmark for yourself.
Similar company size and culture, for example, are indicators of good comparability – as are similar processes. Once the discipline to be analyzed has been selected, it’s time to collect the relevant data.
When benchmarking, best practice doesn’t always have to be from your industry.
It may be much more revealing and effective for you to compare yourself with companies or founders who have similar processes to you but operate in a different industry.
In this way, you can obtain innovative ideas that you might not have had in an internal industry comparison due to the similar structures.
Step 4: Identify deficits in your conducting market research
Once you have collected the relevant information about your best competitors and your company, you use it to find out exactly where your performance deficits are.
In which concrete processes are you weaker than the chosen company and, above all, why?
The causes are therefore so exciting and important because they give you information about how you can optimize your processes in order to become a benchmark yourself.
Then, on the basis of the identified causes, you determine the steps you want to take to reduce the gap between the defined standard and yourself.
As already mentioned, you should not imitate the other company one-to-one. Rather, you should consider how you can use your resources in the best possible and creative way to perhaps even overtake the observed company at some point.
Step 5: Implementation
Last but not least, these measures must be implemented.
Here you should soon start to implement them in order to be able to use the results optimally. If you wait too long with it, your records could already be outdated again – we live in a fast-moving time.
The benchmarking process is a continuous story.
To make sure that you are on the right track to the top and that the gap between you and the top performer is getting smaller and smaller, you should check the status quo regularly.
That’s why it makes more than sense in benchmarking to carry out planning and goal definition precisely and in detail in order to save you duplicate work
. If your benchmarking is based on a proper foundation, you can start right away next time and don’t have to spend time on small details.