The Art of Competitive Intelligence
I started to work with a new client recently and they asked me to prepare a marketing plan for how to take their new software product into the UK small business space. It was particularly pleased with this project and certainly because the product seemed strong and relevant – it was all about increasing efficiencies, managing finances and essentially creating a smarter back office for your small business.
One of the first tasks I advised the client to work on was to look at the competition. It seemed to me the product was good, but it would be entering a hectic market place and therefore the positioning had to be spot on. By positioning I essentially mean which market segment, at which price point and selling what benefits.
Like most small businesses, the client had not even looked at this area, but instead had focused on developing a strong product and some solid client credentials.
So what is competitor intelligence and what should you do about it?
Well, first of all, it’s not spying on your competitors, it is gathering information you can use to make informed decisions. From a quick web search I found this great quote from Cipher :
“Competitive Intelligence is the ethical gathering and analysis of competitor and market information from open sources. This analysis is used by organizations to make better strategic decisions.”
I like another quote too, this time from oft quoted Chinese Philosopher Sun Tzu:
“If you know yourself but not your enemy, for every victory gained you will also suffer a defeat.”
Ok so this is from the Art of War, but none-the-less it is interesting to think about.
So as a small business owner / marketer, what should I do?
Well I’ll tell you. You could employ a professional and the Society of Competitive Intelligence Professionals has a useful directory.
Alternatively If you would prefer to have a go at this yourself, you might want to have a think about these core steps:
1. Set your objectives – what information do you want to find out?
You could easily spend a lot of time looking at every possible sphere of competition to your business. Be realistic, define your market first, for example if you are a dry cleaner in London, you can probably focus largely on the surrounding area without having to review every dry cleaner in the UK.
What is your unique selling point and how do you compete? If you are largely focused on price, this might be one factor you absolutely must learn about your competitors.
Could you learn from a related field? If you are a dry cleaner, could you consider another service business to get some insights and ideas, for example hairdressing, or vehicle valet services?
2. Define what you already know.
Simple enough, start by listing out the companies you already know about. Create a table and list as many of the following details as you can:
Name
Location
Website
Turnover
Age
Product range
Pricing
Key customers
Core strengths and weaknesses
3. Develop the Profile.
Once you have the basics listed, start to think about what other information you could or should gather and from where. For example, have you employed a sales manager that used to work for the competition? Could they provide some real insight into pricing and sales strategies which you may find useful?
You could also consider:
- Try to find their latest set of accounts (try Companies House in the UK) to help you understand their financial position
- Look in the trade press to identify if they have received any grants recently which you may also benefit from, or whether they have received any investor funding - this may give you a clue as to the money they have to spend on developing the product and marketing communications
- Look for any advertising or promotions they are running to identify their unique selling points, for example are they running Payperclick advertising? If so, which keywords are they bidding on?
- Talking to industry commentators and journalists. These are people paid to understand the market place you are competing in and will have an excellent knowledge of what is working and how the market is developing.
- Suppliers – who are they using and can you get a better price by using the same suppliers?
4. Translating information into knowledge
Once you have spent some time gathering this information and it probably won’t be a quick task, you need to translate that information into useable knowledge.
A good example is looking at price points and how this matches to your customer segments. Continuing with the dry cleaning example, a market which is probably fairly price inelastic (small changes in price will have little impact on demand), you might find your competitors are all more expensive than you.
What action could you take?
In this case you could probably consider increasing your prices a little without impacting sales volumes. This would have a direct impact on your bottom line.
Once you have taken this action, you of course need to monitor the impact and take additional corrective action as necessary. If your price increase does reduce sales volumes, you may wish to revise your stretegy.
5. A regular approach.
Competitive intelligence is not a one off activity. Keep a regular check on the core criteria and ensure this is something all of your team, especially customer facing staff, are involved in.
And that’s it. You don’t have to be a James Bond type to get to grips with competitive intelligence, but you do have to get to grips with it!
I’d love to hear what your experiences are of trying to keep tabs on the competition.
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Ten Reasons Why Businesses Fail to Make Networking Work for Them
A few weeks ago I met with networking expert Andy Lopata and asked if he would be so kind as to write a post for the Marketing Blagger. It wasn’t too long before the following landed in my inbox including some pretty good top tips on how to get the most of out networking.
Certainly I agree with #6 - far too many people attend networking events just wanting to sell, when in reality most people are not there to buy. Think about the long term and build relationships, rather than simply selling.
Well, enough from me, read on for what a true networking expert has to say..:
1 - They network with the wrong groups and/or don’t network with the right groups.
Many people attend networking events because they have been invited and join because they like the ‘buzz’ or see other people getting business. They give little thought, consideration or planning to the aims they have from networking and which networks best help them achieve those goals and to which theycan commit.
TOP TIP - Do your research before joining networking groups. Understand what you want to gain from them and what you need to commit to them to achieve that result.
2 - They don’t know what success will look like
We join networks with a vague idea that they will help our business but without planning out exactly how.
TOP TIP - Work out the REAL cost of your networking to you, and then set yourself a challenging, yet realistic return which will justify your investment. How will you reach that return?
3 - They fail to commit
It’s not enough just to join a network or plan a strategy; you have to see it through. It’s an old cliché, but you really do get out what you are prepared to put in.
TOP TIP - Look at your networking memberships and goals and ask yourself what YOU have to do to get the results you are looking for. Then ask yourself how achievable it is. If it’s too much, adjust your activity to make it more realistic. If it’s easy, perhaps you could be doing more.
4 - They don’t do their homework
“Fail to plan and you plan to fail”. Before you attend a meeting, prepare for it. If you have to give a presentation, know exactly what you want to achieve from it and what you are going to say before you go.
TOP TIP - Put time in your diary each week or each month to look at forthcoming events and why you are going. Work out who you can catch up with or meet there and, if appropriate, contact people in advance to arrange to hook up. And plan any presentations you may have to give.
5 - They don’t follow up their referrals
If you get a reputation for being unreliable, you won’t get referrals. Whether you value the referral or not, FOLLOW IT UP. Even more importantly, make sure you feedback to the person who referred you and keep them in the loop.
TOP TIP - Keep a list to track all referrals received and latest action. If you are not responsible for following it up, make sure you know who is and get feedback from them to pass on. Most importantly, say thank you.
6 - They focus on the sale, not the relationship
Few people go to networking events to buy. So you have to ask yourself what the point is of trying to sell to people who aren’t in buying mode. Think beyond the short-term gain and develop relationships. After all, wouldn’t you prefer to get ten referrals from a long-term relationship than one sale from a passing contact?
TOP TIP - Go through your contact management system or business card file and pick ten people to whom you haven’t spoken for a while. Re-establish contact and then stay in touch.
7 - They are ‘9 to 5 Networkers’
Many people believe that joining a network and either turning up to a meeting or logging in is enough. It isn’t. The most successful networkers meet with their fellow members regularly OUTSIDE of meetings; whether socially or in 1-2-1 and small group meetings.
TOP TIP - Set time aside in your diary every week to meet people from your network, and make sure you fill that time. Attend your networking group’s social events and get to know your fellow members even better.
8 - They are ‘destructive’ rather than ‘constructive’
A network thrives on positive energy. If you are in a group that is struggling, use the meeting time to focus on making what you have work, keep concerns outside the meeting. If you want to contribute to blogs and discussions online, keep your comments positive and constructive, don’t destroy other people’s hard work with nasty or negative comments.
TOP TIP - Focus on being positive whenever you engage in your networking. People don’t want to buy from or refer to negative people. If there are problems, keep your comments positive and constructive, focusing on the solution.
9 - They are collectors
Whether it’s business cards at networking events or connections online, there are people who believe that he who has the most wins the game. Networking doesn’t work like that.
TOP TIP - Collect and hand out cards if your conversation dictates it. Connect online with people with whom you have something in common, and talk about them when you connect, not yourself.
10 - They don’t have a clear message.
We all think that we communicate clearly what we do, but few of us do this successfully.
TOP TIP - Ask people in your network for their perception of what you do, who for and when people need your help.
Labelled ‘Mr Network’ by The Sun, Andy Lopata is one of the UK’s leading business networking strategists. The co-author of two books on networking, his first book, ‘Building a Business on Bacon and Eggs’ looked at how to run business breakfast meetings, while his second ‘…and Death Came Third!’ received worldwide acclaim and reached number 2 on Amazon.co.uk on its launch. For more great writing on networking and further info, visit Andy’s blog.
Tag:Kick Starting 2009
I decided that to stave off the January Blues I’d take a holiday in the first couple of weeks of the year and head to a place where the sun actually shines and where the sea temperature would be a little over freezing. The best bet to avoid a long haul flight and to keep my carbon footprint fairly neutral was Egypt. So, مرحبا, or salam alaikum my Egyptian friends. (I hope that translation into Arabic works ok)
Whilst I was away, I had the time to plough through a few books and to get my thinking straight for what is probably going to be a seriously challenging year. What better place to start than the biographies of world famous entrepreneur Richard Branson and of Dragon’s Den favourite James Caan. Certainly in my eyes two of the finest British born business leaders today. I took a lot out of both books in terms of ideas about how and why to run a business, some of the goals to aim for, but most importantly, the motivation to keep at it. When times get tough, it can get extremely tempting to think about your business and perhaps shelve your entrepreneurial plans. After all, how tempting is this for a beach…
With the year almost a month old now, I figured it really was time to get my first post up for the year. I’ve written in the past about new year business boosters and I thought I’d kick 2009 off with five New Year recession busters.. yes, it simply rolls off the tongue. I realise there are probably many thousands of posts like this out there, but still, I may have some slightly different ideas up my sleeve.
So here goes, here are 5 ideas to help steer you through the recession, which in the UK at least was officially recognised today.
1. STOP reading the newspaper and watching CNN, or the BBC. OK so we all know that the economy is pretty bleak, but what can you actually do about it apart from putting the maximum effort into your business. It’s much easier to do this if you aren’t bogged down in talk of recession, falling house prices, job losses and the rest. To quote Chris Cardell
“The greatest threat to your business over the next year is not the economy. It’s fear. While we do need to address the recession head on – the fear mongering in the media is extremely unhelpful.”
2. Watch your overheads and look for cost savings. Ok, so it’s hardly visionary stuff, but take a careful look through your expenses and see where you can weed out some costs savings. Do you really need the water cooler, is it still worth paying for the extended warranty on your PC, why is it your petty cash is always empty half way through the month, are you sure you want to be paying for your employees personal calls… you get the idea. Only spend on the essentials for servicing existing clients, or winning new ones.
3. Make everyone a sales manager. How many people in your team are responsible for selling? My advice is to make everyone responsible, from your secretary, to your cleaner, to the financial controller and the shop floor worker. How do you do this? The first step is to provide everyone with the information they need to sell, i.e. provide a little training. The crucial next step is to incentivise everyone to sell. In today’s economic climate that shouldn’t be too hard, just provide some financial incentive e.g. a bonus for every employee linked to a certain profit level or sales performance. Make sure of course everyone understands the ramifications of falling sales to them!
4. Build a smart marketing programme. You might already have a marketing plan in place, but review it carefully and look for any items linked to measures around brand building, or tactics where results may be difficult to measure or more long term in nature, such as public relations. Refocus the plan to include tactics that are more likely to induce a sale, such as special offers and sales promotions, telemarketing, direct mail or sales led events and exhibitions.
5. Segment and target. Or divide and conquer as you may know it. Essentially look to reach out to those target customer segments who are more likely to have some budget available. For example, people working in the public sector who will find their jobs fairly secure thanks to huge investments in public sector projects from governments around the world. At the same time, build on your areas of expertise and don’t try to sell you wares to too broad an audience - the costs of doing so will be enourmous. Focus on you core target customer segments.
6. Don’t forget to keep reading the marketingblagger.com. Yes, I know that’s six and a little bit cheeky, but like most of you, I’m genuinely running a small business and also work with plenty of other small businesses. As such, I’ll keep sharing ideas and posting up experiences here a lot more regularly. I’m planning on finishing my 101 Shoestring Marketing ebook soon, along with posting up some inspirational ideas from small businesses everywhere. A great example is the photo below, which I’ve been meaning to write about for a long time. Hats off to anyone who can tell me why you think I like this marketing idea so much..
Well, I wish everyone a huge amount of success in 2009. It’s not going to be easy but I love a challenge, to quote a colleague of mine from Granit, a London based architecture practice.
Tag:How to get the most from your marketing agencies?
I’ve worked in marketing and communications agencies for a little while now and I have represented clients large and small. Some with millions of dollars of marketing budget and others with pennies, or in some cases nothing at all. If you want to get the most from your agency, whether professional marketer or small business owner, there are a few factors you really should think about.
I am constantly surprised by how few marketers know how to effectively brief and manage an agency. As such, here are a few thoughts from someone who has sat on both sides of the client agency divide:
1. Start with a strong brief
All too often agencies are given a brief that is either too broad for there to be a clear definition of success, or is too defined so as to restrict creativity and allow little room for creativity and strategic consulting. There is no standard agency briefing template, but you should consider the following:
- Background to your business / industry
- Short analysis of trading conditions, including the market, key competitors
- Your companies strengths and weaknesses
- Budget and any preferences you have for its expenditure
- Target audiences – who is the decision maker you want to reach
- Broad objective – create Awareness, Interest, Desire or Action – in most cases for a small business you want to create action as there is little point in engaging in a brand building exercise.
- Timescales – when do you need to have the work completed?
Overall, what are your specific measures of success? For example do you need to see a 15% increase in sales, or 100 new leads for your sales managers to follow-up on.
The key with the brief is to be specific, measurable, actionable, realistic and time bound – to use the old SMART acronym.
2. Build a strong relationship
All agencies will want to build a relationship with you and your first port of call will often be an account handler. My best advice to you is to build a strong relationship with this person, ensure they understand what you need and when, ask them to report on progress regularly and importantly reward them for good work. The account handler will be responsible for ensuring all other elements of the agency team pull together to service your account effectively.
I have two examples of recent best and worst practice in this regard.
- The best practice client develop a partnership approach, involving the account handler in decision making, asking and taking advice, setting clear goals and ensuring the agency was well represented within the client company. Once the programme had achieved its objectives, the client properly rewarded the entire agency team with lunch and a mention to the agency bosses how well they had performed
- The worst practice saw the client take on an authoritative approach, overruling every recommendation made, treating agency staff poorly and generally being quite arrogant – the client is always right approach. As you might imagine, the project did not run so smoothly and ultimately the objectives were not met.
One client would dearly benefit from some lessons from the other.
3. Agree suitable budgets
All agencies will take a slightly different approach to fees depending on the client and your objectives. You may find you are quoted based on time, or a set fee for a project, or a monthly retainer for ongoing services. Your particular objectives will be more suited to one than the other and the agency will identify the best fit.
Ideally, and particularly if the economy becomes more challenging, you may want to set some performance based payments, e.g. you will pay 100% of the fees if the agency reaches the agreed targets of PR coverage, or uplift in sales enquiries. An example might be:
Target: 10 pieces of coverage in national newspapers
Fee: £10,000
Scale: £1,000 per piece of coverage achieved, with a minimum fee of £8,000.
This provides you with a little protection against under performance and the agency will have the incentive to perform.
If you consider this route, add a little carrot along with the stick. In other words reward your agency for over performance to the same scale as if they under perform. Not forgetting of course to set this as a line item in your marketing budget.
4. Communicate regularly
No matter what field of marketing or communications your agency specialises in, they will need to talk with you frequently. A successful campaign is rarely run by an agency in isolation.
For example, they will often need speedy approvals of copy or images, or a quick turnaround when a journalist requests more information or a quote, or they may need sign-off on a particular choice of advertising vehicle.
In addition, for ongoing campaigns, they may advise you on how to react to news or crises, or provide input for where they believe strategy could benefit from tweaking. Listen to their advice, particularly in the case of specialised agencies, and agree on next steps together.
The key is to make yourself available to the agency and to listen. After all, you are paying them for their expertise.
5. Evaluate and feedback continually
Along with ongoing communication with regards to the tactical implementation of any campaign, don’t forget too to feedback at a higher level. Agencies, like employees, need the opportunity to react to negative feedback, as well as positive of course.
A quarterly feedback meeting may be appropriate but each campaign will operate on different timescales. The importance is to keep up the two way evaluation, feedback and communication.
6. Pay a visit to their offices
Agency teams are often extremely busy. Of course you are too and, as the client, you should expect a certain level of service. However, consider how often you ask them to travel to your offices and think whether it may be practical to pay them a visit instead.
This small courtesy will provide you with an insight into their agency style, level of creativity and environment. In addition it will give you the opportunity to meet with the broader account team and possibly more senior agency management. All of these factors may benefit both your campaign effectiveness but also your ongoing relationship with the agency.
Agency client relationships are vital to the success of any campaign. Whether it is advertising, PR, web design, DM or other, it is very easy to get this wrong. The emphasis to my mind should always lie in a strong relationship built on clear performance objectives.
Whilst it may be difficult for a small business owner or someone new to the game, there is certainly no excuse for a professional marketer to manage his / her agencies poorly.
If you want some advice about how to choose the right agency, there is a decent enough article on Business Link, or you could do worse than looking up the PRCA (Public Relations Consultants Association) or the CIM (Chartered Institute of Marketing).
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