Business Plan: Competition Analysis

The goal of marketing is to clearly communicate your primary competitive advantage to your target audience. The concept is to find something that gives you a clear advantage over your competitors. To do that you need to compare your business to that of your direct competitors.

Competitors come in all shapes and sizes depending upon your who you are targeting as your primary customer. For example, lets look at a Professional Sports Team.

In today's marketplace the competition for entertainment dollars is fierce. Direct competitors might include professional sports teams, concerts or even rodeo events. Don't forget other events that might take place on the same day as your event.

Action: make a list direct competitors.

Indirect competitors or substitute products/services could be:

Block Buster Video.
Movie Theaters.
Dining Out.
Exhibitions and Fairs.
Dinner Theater.
The local Symphony Orchestra.
The Opera.
What else can you think of?
Action: who else in your market is competing for the same dollar?

Remember, people have only a certain amount of disposable income for entertainment. The goal here is to come to a better understanding of your competitors and what motivates people to do business with them. This will allow you to build a strategy and position your products/services to ensure that your company, it's products and services have a fighting chance to win market share. What you learn here will be very valuable and helpful in forming your Marketing Strategy.

Describe each of your direct competitors. Create comparison charts that include an overview and analysis of the following:

Describe your direct, indirect, substitute or potential competitors. Who are they? Identify them buy name and then gather the following information:
Strengths: what do they do well? What do they say is (in their advertising) their primary competitive advantage? Identify their market share size, volume and profitability. Are they bigger or smaller than you?
Weaknesses: where are they weak? What could they improve upon?
Describe their characteristics, strategies and operational methods -- what price do they sell for? How would you describe the quality? Credit Terms? Servicing? Sales and Distribution methods? Reputation? Management background and expertise?