Defining who is really your competition
For many companies, it is not as easy to define who your competition is real. Either because they are scattered in a large number of players, where no impacts or sufficient visibility; or either because the product or service is really new, nothing is exactly the same in the market (which does not mean that there is no competition). You must identify what this competitor or competitors who should focus to identify potential risks and their differentials are relevant for customers.
Why is it important to identify who your competition?
Because unless you know what the arguments of those competitors against which potential customer is comparing (they are differential, selling points, reasons will give a potential customer), will not know if they are relevant, they are unless know what are the reasons and how its value proposition compared to the other alternatives. Remember that strengths are not differential. If you do not know who and how to compete, it may be giving arguments that customers may not be relevant.
How to define who they really your competitors
There is a golden rule: whoever competitor is your prospect would consider as a direct substitute for what you meet. And sometimes it is not so obvious, sometimes they are not companies that do the same, they can be solved simply operating the same thing differently.
Think for example of a university or a school. Basically they sell training, knowledge, networking or support to have a title. Depending on the reason you have the target market to which it is directed, competitors may be multiple. A university may be competing with refresher courses, with conferences or symposia. While they may have different durations, they solve the same as is training in a specific subject. You can compete against online training programs, with mobile applications, books and against all forms of learning. Even with training programs in-house or own businesses. If offers training in sales and as a company has internally designed a model of training to train each new seller, so they already decided what your company training or university meets. When viewed from this perspective, the competence of a university are not only other universities or schools, it is every one that meets the need of training, knowledge and training that can deliver multiple competitors. And if people are looking for is going to college for the title there and obviously competes with others that offer title; but on the principle of everyone who meets the same as you meet. It is a proposal of similar value, when we talk about proposed similar value it refers to one who is delivering all these benefits, arguments, alternatives, options or reasons why a client should hire him.
Two types of competitors who must pay close attention
1) That could easily match its differential
For example if it is a health entity and its differential is that it has all the services within the same hospital or has the latest equipment, then you have to look at what is the reason why a customer should buy from you and not my competitors all part of the differential. Who could match his speech quickly and equalize the differential?
2) That would create a more attractive spread
He who seeks another differential and looking for a different argument, which can be as important for the market (versus yours). Continuing with the example of health entity, if such difference in the human treatment, procedures or comprehensiveness of professionals; You can leave a competitor that says “We have the fastest time of emergency care”, as does indeed Aventura Hospital in Miami and others of the same network, it posted on its website. This competitor is not leveraging the same arguments it takes another path that is important to pay attention, because your potential customer may look much more attracted to the value proposition of this competitor versus yours.
Racing solver just like you
In short, the competition is every one that meets what you meet, the same way you do. No need to sell exactly what you sell. They are direct replacements to their customers would consider buying them.