"Frenemy- Someone who acts as your friend while having ulterior motives. Winston Churchill is credited with first coining this term while discussing America's involvement in WW2."
There is nothing quite like a little friendly competition.
Competition is often seen as a challenge to overcome. However, while your competitors may be jostling with you for market share and the attention of your target audience, a lot can also be gained from some healthy competition. Keep your friends close, they say, but keep your enemies closer.
Competitors can often understand your business the best. Do you understand your competitors' business? You may be surprised at how much you can learn by observing your competitors.
Having healthy competition challenges you to be more innovative, keeps you on your toes and constantly pushes you to find better ways to create value for your customers. They provide a framework from which you can develop strategic pricing and positioning.
Do you know where you stand among your competitors? Have you considered how current or potential customers view your brand when compared to others in your industry?
One tool which can be used to consider your positioning is referred to as perceptual mapping. It is essentially a diagram used by marketers to visually display the perceptions of customers or potential customers. Note that the criteria on which they are judged are not fixed. You can adapt the descriptions for your own industry.
In the first example, these popular car brands are rated on price and perceived quality.
In this second example, the same brands are being measured according to brand perceptions of whether or not they are "Classy or Practical" as well as "Conservative or Sporty".
Try drawing up a map of your own and include some of your main competitors to see where you might fall. Understanding how customers perceive you against your competitors can help you better understand areas in which you stand out against your competitors. It can also highlight opportunities for growth, areas which you can improve to be more competitive.
Consider also that you may have different types of competitors. There are primary competitors, who are direct competitors and are vying for the same audience with a very similar product or service. You may have secondary, or indirect competitors who may be offering a high- or low-end version of what you offer. They have the same product or service t but their strategy and/or positioning is slightly different from yours. Finally, you have your replacement competitor, who is fulfilling the same needs as your target audience but with a different product. For example, fulfilling the need for food can be satisfied by going to a restaurant or by stopping in the supermarket. Restaurant and groceries may be operating in different industries, but at the heart of it they are vying for the same audience with the same need- hungry consumers.
Are you pro-active or reactive to their tactics? Are you taking the lead in your industry and setting the pace? Or are you one to wait to see how the market reacts before trying it out yourself? There are advantages and disadvantages for both approaches. Taking the lead can sometimes give you a head start and allow you to claim market share in uncharted territory while your competitors fight to catch up. However, it can be risky being first. Consider if you read the market wrong and they are not ready to buy this revolutionary product or service you are offering. This is where the more conservative "wait and see" approach can slip into action and learn from your mistakes. It allows the late adapters time to assess the situation, learn and modify their strategy to suit.
So yes, a competitive market can be challenging to overcome, making it difficult for you to stand out and claim your space. On the other hand, do not underestimate how your competitors are also a fantastic opportunity for gaining information about your industry, your target market and strategic positioning.
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[*Perceptual map source: https://rockstarsbm.wordpress.com/2014/11/23/perceptual-maps/, accessed 22 January 2019]