Now that you know how to put together a competitive assessment, let’s go over some of the main pitfalls to be aware of that can throw off the insights you’ve gathered.
1. Competitive analysis is not a one-and-done exercise
Never revisiting your original insights (or never updating them, for that matter) can lead to faulty data and poor decisions. Businesses are constantly evolving, so it’s important to remember that keeping an eye on your competitors is an ongoing process—not something you do once and then never again. Ultimately, you have to be at the top of your game consistently if you want to increase your market share.
2. Confirmation bias is real
As humans, we have a tendency to jump to conclusions around our assumptions. This is called confirmation bias. As you work through your analysis, it’s important to be aware of your initial assumptions and to test them thoroughly rather than leaning on what you “think” is true about your competitors. Let the data inform your decisions rather than letting assumptions take the lead.
3. Data without action is useless
If you’re putting in the work to do a competitor analysis, be sure that you’re acting on the findings rather than letting them gather virtual dust on your computer, buried in an obscure file folder. Make a strategic plan around your findings and execute on the unique angles and tactics that you’ve discovered during this process.
4. Working harder instead of smarter
With so many great resources available that simplify the data collection process around competitive analysis today, putting together a top-notch, highly accurate comparison is easier than ever before. Don’t reinvent the wheel and do things the hard way: make the investment into tools that speed up the process and provide the important insights you need to make informed, data-backed decisions about your business.
5. Starting without a direction
If you’re directionless while putting together your competitive analysis and have no clear end objective, the work will be much, much harder. Before diving into research, define your goal and what you hope to learn about your competition. What do you want to accomplish? What do you want to build? It is your own business after all!
6. Not accounting for market timing
When looking at competitor data, be sure to study how companies have grown and progressed over time rather than examining their approaches at a single fixed point.
Sometimes information about how your competitors have evolved their tactics can be even more useful than knowing what they did in the early days (or what they’re doing right now). Understanding past, current, and future industry trends will help you make better decisions.
Competitive analysis: your business edge
Competitive intelligence is key to starting a business. By doing market competition analysis on an ongoing basis, you can always be on top of your competition. You’ll be able to break into new markets, launch new products, and keep tabs on your competitors’ customers—giving you a cutting edge approach to small business that keeps your business or startup agile.
