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3 Types of Competitors to Watch (+ How to Find Them)

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3 Types of Competitors to Watch (+ How to Find Them)

According to a 2020 survey, most businesses have an average of 29 competitors. Do you know who yours are?

All businesses have competition — and knowing yours is key for innovating your products, services, and marketing strategies. But identifying the competition isn’t always obvious. Some are direct, while others may take more time to uncover.

Here, we’ll cover the three types of competitors to watch, and five ways to identify them.

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3 Types of Competitors in Business

1. Direct competitors.

A direct competitor probably comes to mind when you think of your competition. These are businesses offering similar (or identical) products or services in the same market. They also vye for the same customer base.

Some famous examples of direct competitors include Apple versus Android, Pepsi versus Coca-Cola, and Netflix versus Hulu. But direct competition isn’t exclusive to well-known national or international brands. Two shoe stores in a rural town are direct competitors. So are a handful of realtors servicing one area.

Digital companies also see direct competition. For example, after the success of Twitter’s Periscope app, Facebook pivoted its focus to live video to keep up.

Since direct competitors sell similar products in a similar manner, this type of competition is often a zero-sum game — meaning, a customer that buys a competitor’s product won’t buy yours. For example, if you buy a hamburger at McDonald’s, it’s not likely you’ll swing by Burger King to buy another one.

2. Indirect competitors.

Indirect competitors are businesses in the same category that sell different products or services to solve the same problem.

For example, Taco Bell and Subway fall under the same category — fast-food — but they offer entirely different menu options. While they both seek to solve the same problem (feed hungry people), they provide different products to solve it.

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Here’s another example — residential painters experience indirect competition with home improvement chains like Home Depot or Lowes. Again, the category is the same but the product offerings differ.

Indirect competition isn’t necessarily a zero-sum game. Consider someone buying supplies from Lowe’s to re-paint their home —only to do a sloppy job. They may call a local painter to fix the mistakes.

3. Replacement competitors.

A replacement competitor offers an alternative to the product or service that you offer. You both seek to solve the same pain points, but the means are different.

For example, a restaurant and coffee shop in the same neighborhood could be replacement competitors. Walking down the street, some customers may choose to grab a to-go lunch from the coffee shop, while others prefer the restaurant.

The idea here is that customers are using the same resources to purchase the replacement that they could’ve used to buy your offerings.

These competitors are potentially dangerous if there’s more than one way to solve the same problem you seek to resolve. Additionally, these are the most challenging competitors to identify. After all, we can’t read people’s minds and understand all the choices that led them to us.

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But we can find other ways to uncover this information — such as requesting feedback from customers or keeping an eye on their social media mentions. With this insight, you can better understand your audience and identify your replacement competitors.

As you work to identify your competitors, you may discover more than you anticipated. Don’t get overwhelmed. Remember that not all competitors are built the same — some are less of a threat than others.

Now let’s discuss ways to identify the players above, below, and next to you.

5 Ways to Identify the Competition

1. Check the first page of Google.

An easy starting point is doing a quick Google search. Think of a few keywords someone might search to find you, such as [service or product] + [location]. For example, general contractor Sacramento.

Then, note the top companies on the first page of your search results. You may notice your keywords return thousands of results, but you shouldn’t stress. The most relevant section is the first page and the competition directly above and below you on it. Those tend to be your direct competitors.

2. Research targeted keywords.

Check the keywords you are currently targeting to identify other businesses targeting the same ones.

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This is a solid strategy for finding your indirect competition since they likely target the same keywords. For example, the keyword “fast-food” may reveal Subway and Taco Bell — both indirect competitors —as the top two results.

3. Monitor social media conversations.

Opinions are aplenty on social media — so it’s relatively easy to find what your customers are saying. To find relevant conversations, enter your businesses’ name in the search bar and check the results.

For instance, someone may post a question to Twitter asking what hair salon they should visit in your city. A follower may respond with the name of your business, along with a handful of others.

You can expand your search beyond social media to include community forums, such as Reddit or Quora — along with review sites like Yelp. Both of these resources can reveal helpful insight into your customers and why they chose your business over the competition.

4. Perform market research.

Check the market for your product or service and note any companies with a competing offer. Market research can be done a number of ways — whether that be with a Google search, by browsing through trade journals, or by talking with your sales team to see what other companies are commonly brought up by customers (to name a few).

5. Ask your customers.

Customers are crucial to identifying your competition — after all, they likely sifted through most of them before landing on you. There are many ways to solicit feedback from customers — both online and in-person. That could mean striking up conversations while cashing them out or sending an email survey after each sale. One way or another, try to find the best approach and regularly check the feedback for any trends.

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Every business has competition, and it pays to know the top players. But remember, as your business grows and evolves, so too will the competition. A direct competitor may go out of business, or an indirect competitor may become a direct one. All this to say, make a habit of routinely checking those above, below, and next to you.

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MARKETING

Trends in Content Localization – Moz

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Trends in Content Localization - Moz

Multinational fast food chains are one of the best-known examples of recognizing that product menus may sometimes have to change significantly to serve distinct audiences. The above video is just a short run-through of the same business selling smokehouse burgers, kofta, paneer, and rice bowls in an effort to appeal to people in a variety of places. I can’t personally judge the validity of these representations, but what I can see is that, in such cases, you don’t merely localize your content but the products on which your content is founded.

Sometimes, even the branding of businesses is different around the world; what we call Burger King in America is Hungry Jack’s in Australia, Lays potato chips here are Sabritas in Mexico, and DiGiorno frozen pizza is familiar in the US, but Canada knows it as Delissio.

Tales of product tailoring failures often become famous, likely because some of them may seem humorous from a distance, but cultural sensitivity should always be taken seriously. If a brand you are marketing is on its way to becoming a large global seller, the best insurance against reputation damage and revenue loss as a result of cultural insensitivity is to employ regional and cultural experts whose first-hand and lived experiences can steward the organization in acting with awareness and respect.

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How AI Is Redefining Startup GTM Strategy

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How AI Is Redefining Startup GTM Strategy

AI and startups? It just makes sense.

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More promotions and more layoffs

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More promotions and more layoffs

For martech professionals salaries are good and promotions are coming faster, unfortunately, layoffs are coming faster, too. That’s according to the just-released 2024 Martech Salary and Career Survey. Another very unfortunate finding: The median salary of women below the C-suite level is 35% less than what men earn.

The last year saw many different economic trends, some at odds with each other. Although unemployment remained very low overall and the economy grew, some businesses — especially those in technology and media — cut both jobs and spending. Reasons cited for the cuts include during the early years of the pandemic, higher interest rates and corporate greed.

Dig deeper: How to overcome marketing budget cuts and hiring freezes

Be that as it may, for the employed it remains a good time to be a martech professional. Salaries remain lucrative compared to many other professions, with an overall median salary of $128,643. 

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Here are the median salaries by role:

  • Senior management $199,653
  • Director $157,776
  • Manager $99,510
  • Staff $89,126

Senior managers make more than twice what staff make. Directors and up had a $163,395 median salary compared to manager/staff roles, where the median was $94,818.

One-third of those surveyed said they were promoted in the last 12 months, a finding that was nearly equal among director+ (32%) and managers and staff (30%). 

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Extend the time frame to two years, and nearly three-quarters of director+ respondents say they received a promotion, while the same can be said for two-thirds of manager and staff respondents.

Dig deeper: Skills-based hiring for modern marketing teams

Employee turnover 

In 2023, we asked survey respondents if they noticed an increase in employee churn and whether they would classify that churn as a “moderate” or “significant” increase. For 2024, given the attention on cost reductions and layoffs, we asked if the churn they witnessed was “voluntary” (e.g., people leaving for another role) or “involuntary” (e.g., a layoff or dismissal). More than half of the marketing technology professionals said churn increased in the last year. Nearly one-third classified most of the churn as “involuntary.”

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Men and Women

Screenshot 2024 03 21 124540Screenshot 2024 03 21 124540

This year, instead of using average salary figures, we used the median figures to lessen the impact of outliers in the salary data. As a result, the gap between salaries for men and women is even more glaring than it was previously.

In last year’s report, men earned an average of 24% more than women. This year the median salary of men is 35% more than the median salary of women. That is until you get to the upper echelons. Women at director and up earned 5% more than men.

Methodology

The 2024 MarTech Salary and Career Survey is a joint project of MarTech.org and chiefmartec.com. We surveyed 305 marketers between December 2023 and February 2024; 297 of those provided salary information. Nearly 63% (191) of respondents live in North America; 16% (50) live in Western Europe. The conclusions in this report are limited to responses from those individuals only. Other regions were excluded due to the limited number of respondents. 

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Download your copy of the 2024 MarTech Salary and Career Survey here. No registration is required.

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