Best ways to identify competitors for your startup
Identifying competitors is invaluable. Being able to identify competitors will allow you to correctly price your services, develop marketing strategies, and learn your target audience. Without this knowledge, your startup will struggle to get up on its feet and indeed prosper.
The types of competitors
Before learning how to identify competitors, you must understand what types of competition you will face. Your startup will encounter five classes of competition, direct competition, indirect competition, potential competition, future competition, and replacement competitors. All these competitors will affect your business, but you will need to know their difference to better research them.
To identify direct competitors, you will need to begin with your product. A direct competitor sells or markets the same goods or services that your startup sells. Therefore, you must understand every component of your product and know its value. By finding direct competitors, you will help yourself research your product and truly appreciate its market value. Some ways to identify competitors include social media platforms, market research, and google search results, detailed below.
Check social media platforms
Potential customers often ask other customers where to find the best products on social media platforms like Reddit. According to Conductor, 27% of Gen Z and Millennials will take recommendations from social media friends. By going onto these social media websites and finding ways to identify competitors by checking chat logs and forums, you will better grasp who your competitors are. With such a high number of users using social media to find new products, it is essential to identify competitors using social media. There is a big chance that you will find several new competitors by checking out these platforms. You may have never seen these competitors and are clearly working with the younger population to increase sales. You will want to replicate their marketing strategy to improve upon them and find the best ways to interact with social media users. Expanding your business onto social media will grow your customer base and allow you to reach new consumers.
A critical element that will help you identify competitors for your startup is to research the market. You should sit down and analyze the product you are selling to identify other companies selling the same thing. You can identify competitors by simply searching for the product you sell on the internet and identifying other startups that sell your goods. You can then note each company that sells your product and begins to research the startups themselves. When analyzing these startups, you should look into their prices and marketing strategies. If they are all selling their products for similar prices and marketing in similar ways, you will be able to identify the best prices to begin selling at. Also, you will be able to identify the marketing strategies that are working and will be able to start working to create a better approach that will edge your competition out. Market research will teach you the best ways to market and sell your products in the fast-paced market we have today. Market research will also help you to identify competitors that you will encounter.
Google search results
When researching your products, it may be beneficial to simply type your products into the Google search engine to find the top-rated startups. Being able to identify competitors can be highly profitable as you will find the best-built websites and SEO content for your startup's website. Take the time to look your company’s keywords up in a search engine and see where it takes you. The top results will often be beneficial to your research as they will identify the best digital competition. Along with search engines, another way to gain insights into your competitors' SEO strategies and website performance is by using website optimization tools such as Yieldify, SEMRush, or Ahrefs.
Indirect competitors can be just as essential to identify as direct competitors. These startups are not competitors who sell the same goods but instead use the exact keywords as your startup. These competitors will fight for your digital space and possibly push you down in search results. Therefore, you must optimize your keywords better than your indirect competition to make your product visible to the world. The best ways to identify competitors include keyword research and paid data, which are detailed below.
You must be researching your keywords to find your indirect competition. You should use keywords to identify who you are up against. Keywords will be invaluable when you place competitors. You will need to be prepared to do in-depth research into each website that uses your keywords to find the best ways to outperform their keyword optimization. Your startup will significantly benefit from you finding your indirect competitors, bringing a plethora of new research to the table for you to use.
You should look into your keyword’s paid data. If several companies buy ad space with your keyword, there may be a lot of competition for the specific keyword. You can look into the startups that you find are buying up this ad space. This will help you identify new competition you may have been unaware of before to better research your site's optimization.
A potential competitor is a competitor selling your product but in a different market than you are selling in. It is essential to identify competitors like this to see what works best in other markets. These competitors can still teach you what works best so that you do not have to spend time learning these techniques yourself. Any time you can save by using competitors' research is time to expand your startup. You may never encounter these competitors, but they will still help your business.
How to identify potential competitors
You can identify competitors like this in similar ways as your direct competitors. However, instead of focusing on local businesses, you should focus on companies based in other parts of the world so that you will know they are much less likely to enter your market. In addition, if you identify competitors that you will probably not encounter, you should consider them when developing strategies to sell your goods instead of simply ignoring them. You will then be able to do in-depth research into the potential competitors you find. These competitors offer great insight into the services you will be selling and help you market them in better ways.
A future competitor is a competitor that you will not encounter right away but most likely will at some point or another. They will enter your market, so you will need to be prepared to test them in the market. When you identify competitors like this, you should note them and treat them like your current competition. You do not want to forget about these competitors because they could very easily steal your customers one day. Make sure that you research their strategies and find the best ways to outperform them before entering your market. It is much easier to have a better plan off the bat than to play catch up while they steal your customers.
How to identify future competitors
You can identify competitors that you will encounter in the future by doing market research in areas close to your market. When you do this, you will want to investigate competitors that dominate the markets they compete in. When you identify competitors you will encounter in the future, you should note them so you can keep track of their expansion. Companies that are already dominating their local markets will be more likely to make a move to expand their business into new areas. If a business that can dominate a market moves to your location, you will have to know how to combat their push to take over your local market. By researching these companies' best strategies, you will have your best chance at competing with these large companies. It is necessary to identify competitors that you will encounter to be prepared for them to enter your market in the future.
Replacement competitors sell different products than you but sell products that solve the same problems that yours do. If they present their product more effectively than yours, it could hurt your ability to sell your product to potential customers. Therefore, it is vital to identify competitors like these to find the best ways to make your product look like a better solution to the problem at hand. If the products you sell seem to be the easiest fix to a customer's needs, they will choose your product over the competition.
How to identify replacement competitors
You can identify competitors who threaten to replace you by taking steps to research the problem that your good is solving. If other goods are being sold that also fix the problem you are trying to solve, you will need to find ways to better market your goods than theirs. Replacement competition can be extremely dangerous to your startup, as they can quickly provide better reasons to use a different product than yours. Due to this, you will need to identify competitors who will replace you to outperform them and convince customers to use your goods over theirs.
Why you need to identify competitors
Why is it essential to identify competitors? First, it is crucial to identify competitors to learn the best marketing strategies that your competitors are using to improve upon them and use them yourself. You will also determine the best prices to sell your goods and why they will help you succeed.
For example, if you were to own a startup that mowed lawns for people, you could use this process to grow your business. You can use this process to identify competitors and how to edge them out. To start, you would identify competitors, research the ways they sell their service to customers, and learn why it works for them. From there, you could take your services keywords and search them up on the internet to identify indirect competitors for your startup. Once you place all your competitors, you can begin to analyze the best keyword optimization that their websites use. You would notice that your lawn mowing startup could very easily share keywords with other companies that have no relation to lawn mowing. You could easily share keywords with companies who plant or fertilize grass, meaning that you will have to beat other lawn mowing companies' SEO and these new companies that you usually would not be competing with.
Even though these unrelated companies will not steal your business, they could very easily hide your startup from potential customers. You will also see that there are potential competitors who mow lawns in different cities. They may not provide real competition for you, but they will still offer great marketing techniques that you can learn to beat the competition in your area. You will also see future competitors. These competitors will be based in other parts of your city or nearby cities but have plans of expanding into your area.
When you identify competitors you know you will compete against, you should find the best ways to counter them. You will need to grow your business and develop the best marketing strategy to keep the lawns in your area under your control so that when new, more prominent companies move in, they do not steal your business. Lastly, you will also encounter replacement competition. These companies may be selling fake grass, or rock lawns, making mowing irrelevant. If your customers begin to use artificial grass and rock lawns, your customer base will slowly shrink.
Due to this, you will need to find the best strategies for convincing your customer base that it is best to have natural grass mowed instead of fake lawns that will require no upkeep. It is important to always identify competitors to best research your business and find the best strategies for you. After identifying these competitors, you can learn from them and find the best ways to grow your business using your competition. They may be trying to steal your customers but can be great tools for expanding your knowledge and getting better at selling your services to your customers.