Scouting competitors can give you an advantage in building campaigns and increasing market share – but it has to be done smartly to create a positive outcome. Experts insist gathering competitive intelligence should be a tool you use to better understand the marketplace, but it can’t consume you.
“You have to be aware of all the forces that can impact your business,” says Seena Sharp, managing director of consultancy Sharp Market Intelligence. “Competitors are one, but they’re only one.”
It might surprise you, in fact, that getting ahead in sales can oftentimes be easier when you work with and help competitors. Here are some ways you can plot your approach, with suggestions for what you should avoid doing, as well.
Skip the Web
While the Internet can provide some information on business rivals – like pricing and product selection – Sharp thinks Web-browsing is overdone. “You have to remember that the website presents what the company wants you to see,” she says. “It can be outdated if they haven’t kept it current. There could be changes to their business that haven’t even gotten to the site.”
Sharp also cautions that using search engines to find info on competitors is likely a waste of your time. “The two most likely places where people go – Google and a competitor’s website – are the poorest sources of business information,” she says. “It’s the most superficial and the least useful information. There are times when you will find articles or other information that could be fabulous, but, generally speaking, that doesn’t happen.”
Make a Visit
If your top competitor has a local storefront, Sharp suggests getting off your computer and going across town to pay a visit. “Do some secret shopping,” she says. “Go in there and walk around. There’s nothing wrong with that, and it’s totally ethical.”
Sharp also thinks it’s well within bounds to ask some questions of competing, if unsuspecting, salespeople. That list might include: What products are customers buying and excited about? What products are customers no longer interested in? What are customers asking for that you don’t offer? Sharp believes that last question can yield the greatest returns because you might be able to fill a market gap by offering new services. “In one case, you have more risk,” Sharp says, “but you also have the possibility of being the leader in the field and being one of the first ones to provide it.”
Whether it’s at their physical location or at a neutral site like a trade show, author Rob Duncan believes distributors should actually look to collaborate with competitors – especially the most successful ones.
“I always like to challenge people who are going through this kind of exercise to ask: Who keeps you awake at night? Who really, really gets to you every time? Who are you really worried about? Those are the ones you should focus on,” says Duncan, author of Competitive Intelligence: Fast, Cheap & Ethical. “Eighty percent of your focus should go on the ones that are really eating your lunch.”
Duncan has had experience, and positive results, in working with the competition when he ran an innovation center. “We were really good with a certain type of prototyping of new products,” he says, “so we would identify the other people around in similar businesses. If we got something that wasn’t really in our sweet spot, we would give it off to somebody else. If they had something that was in our sweet spot, they would send it to us.”
Duncan says an industry event is the perfect time to outline such a collaborative project. “You’re not necessarily giving away your secret sauce – that one thing that is your key success factor,” he says. “But maybe there’s a third-party competitor that’s annoying the both of you. You can share information about what they’re doing, and maybe you have some information that’s important to a competitor that is not that important to you.”
This kind of up front, give-and-take approach is also 100% ethical, which Duncan contends is always the best route, rather than posing as someone you’re not. “I think you can gain a lot by simply saying, ‘Hey, this is who I am. We’re working in the same industry here. I’m wondering if there’s any intelligence we can share that can make us both better at what we do,’” Duncan says.
Beyond information sharing, Sharp believes there’s a wealth of other market knowledge easily available to distributors. Where is it? It’s in trade publications that cover industries well worth targeting.
“I highly encourage people to subscribe to their local business journal,” Sharp says. “There are business journals in more than 40 cities. That will tell them about the business environment in those cities locally.”
On a national level, Sharp cites the Wall Street Journal as her favorite business barometer. But no matter where you turn for insight, Sharp urges diligence and consistency.
“Don’t think that research is something that you do in 5 to 10 minutes,” she says. “You can’t live in a vacuum of believing you know your own industry, you know your own products and services, and you know what’s changing.”