Competitive Landscape – Beating Both the Direct and Indirect Competition6 min read
There is no denying that in today’s world, there is a strong competitive landscape that a lot of brand and company owners aren’t fans of. However, if you think about it, it is exactly that landscape that pushes you into doing more and consequently, making sure your brand is doing better in terms of both performance and marketing.
But if you’re trying to do exactly that, you’re looking at two types of competition you’re fighting against – direct and indirect competition. There are ways to beat both of them, making sure your brand is what your customers go for at the end of the day, not your competitors.
Understanding Direct Competition
The direct competitors within the landscape are quite obvious – we’re talking about companies, brands, or individuals that are in the same industry as you are, and offer the same thing you do. These are the competitors you need to work hardest against because at the end of the day, any potential customers will be put in a position to choose between you and them. In most cases, it comes down to marketing.
To add to this, direct competition, aside from offering the same (or similar) products, will also target the same customers and audience within the landscape, and will usually aim to achieve the same pricing position as you. They’re trying to be a better alternative, and don’t want you to succeed.
What About Indirect Competitors?
On the other hand, the indirect competition shouldn’t have you that worried, but it is still something you should focus on. Indirect competitors offer a different approach to an audience or customers that want to reach the same goal. For example, if you’re offering to build a website as a service, an indirect competitor would be someone who offers easy tutorials and information on how to use WordPress to build a website.
Now, while this is a completely different approach (and one that requires a lot of hands-on work from the customer), it still has the same goal – to have the customer end up with a website. And the ‘cost’ will probably be comparable too when you consider that the customer will have to spend a load of their time to build the ability to do things as they see fit. This may or may not be the best approach, but some potential customers may prefer to save money on professional services, especially at the low-end and if they have plenty of spare time.
Understanding Direct vs Indirect Competition
It’s not exactly new information that your company and service have competitors. Buyer behavior changes, their preferences change, and if you aren’t adapting to that, you’re probably losing customers. You must perform an analysis and understand both the direct and indirect competitive businesses if you want to build a marketing plan that has them both beat.
But, it’s about a lot more than just checking out the latest trends for your service or industry and keeping in touch. Here’s an example – you’ve got an eCommerce store, and while a physical shop isn’t truly competition, an underlying factor is the fact that a customer might want to look at a product physically before they make up their mind. These underlying factors require an understanding of the industry, or you might overlook them completely. In the aforementioned example, offering a trial and a quick return within a timeframe are great ways to combat the issue.
Having Both Sides Beat
Now that you know what is direct competition, and what indirect competitors are, here are a few things you should be doing in order to have both sides beat.
Watch The Competition
One of the most important things to understand is how your customers think. You should know what they want, what makes them rethink decisions, what the things they value in the products they buy, and what position they’re in. Company owners aren’t your only competitors.
You’re also fighting trends, which change literally by the minute but can have a major impact on purchase decisions. Is your product something people like nowadays, or is it a trend that’s slowly fading? Pay attention, as this can impact your competitive landscape seemingly overnight.
And of course, you have economics to think about. A positive thing is that economic fluctuations don’t only impact your business (and industry), but usually every single one. Market leaders and businesses that are aggressive in times of downturn can often make substantial market share increases.
Analysis for business should be constant and iteratively improved upon. Are there areas where your business could improve? Take our free digital health check to help assess areas you can improve.
Interact With Customers
The content you post, whether it’s on a company blog, or social media, or anywhere else, is how your business interacts with customers. While most companies use it to boast how great their products are, you should use it to provide something helpful for your customers.
Here’s an example – if you’re in the restaurant industry, give your customers cooking advice and recipes. Let them know that you’re there for them even if they aren’t able to visit your restaurant. Is your business a marketing agency? Give them tips on how to improve their business’ success.
This kind of interaction goes a long way towards supporting your customers and whatever journey they may be on. It may not promote your brand as much, but it builds a relationship and promotes positive brand awareness.
Use The Right Channels
If your goal is to build a loyal customer base, information is key to building a relationship. And building a relationship is best done on channels that your customers use. Rather than spamming them with ads and banners, try talking to them on social media channels like Messenger or Instagram. A quick analysis will show you which channels to go for (or ask our team for recommendations suitable for your industry and audience).
This allows both you as a business and your customers to have a relationship with great communication, and in turn, you can take care of any problems or share necessary information that helps the relationship develop.
Succeeding in Today’s Competitive Landscape
Today with direct and indirect competition growing in most industries, it seems obvious that to succeed, there’s always more for your team to do to succeed. Aim to keep track of companies offering similar products or services to you, and be aware of trends that make your product look undesirable or outdated. Contact us today to help with a complete digital analysis of your business or to help with specific needs.