Give a complete and thorough overview of the competitive market. Cover not only the directly competing companies you face (those who offer a very similar product with similar attributes), but also other product variations you may be competing with. For example, if you're selling herbal teas, are you also competing with regular teas? Instant teas? Canned teas? The drink market in general? Review these types of competitors as well as your direct competitors.
Describe all of the heavy hitters and answer the following questions:
- What are their product's strengths and weaknesses?
- What are their strengths and weaknesses as a company (financial strength, reputation, etc.)?
- Are there weaknesses you can exploit?
- What are the differences between your product features and theirs?
- What were their sales for last year?
- What is their pricing structure?
- In what media vehicles do they promote their products?
- What is their advertising message?
- Where else do they promote their products?
- What were their total advertising expenditures for last year?
- What is their overall goal (profitability, market share, leadership)?
- How are they trying to meet their goals (low prices, better quality, lower overhead)?
- What were their responses to changes you made in your product pricing or promotions?
Information is often the key to a strong competitive advantage. If you've had difficulty digging up information about your competitors, try your suppliers. They can be good sources of information. Visit your competitors' locations, Web sites, exhibit booths; sample their products. You can also gather a wealth of media and advertising information about your competitors on the Internet through companies like Competitive Media Reporting and USAData. These firms and many others provide access to databases covering many areas of industry, media, advertising, and competitive information.