Whether you’re looking to break into the fiercely competitive U.S. market or strike gold in the international marketplace, you first need to define your unique selling proposition (USP). According to Mel Sauvé, CEO of Global Growth, a consultant based in Burlington, Ontario, “this is likely the most important thing you have to do in an international market.”
The essential ingredient for an effective USP is a clear understanding of your competitive advantage. This involves getting as much information as possible about your key competitors in those markets.
“You should develop a business intelligence report for each major company you’re up against,” says Sauvé. “Go after pricing details and pricing quotes, for example, and investigate their marketing strategies.”
What Sauvé is referring to is all part of a market scan (also called a competitive scan), which is critical to helping you get to know your key competitors and how they do business. That’s the insight you need to position your company for success.
1. Who are your competitors and what do they sell?
Look for information that will reveal as much as possible about your most significant competitors and their products. Price lists, marketing materials and annual reports are all great sources of info. Check out your competitors’ presence on social media and in trade publications. Go to trade shows and see their product demonstrations.
2. Who do your competitors sell to?
Find out as much as you can about your competitors’ customers. This will give you great insights into their target audiences and a deeper understanding about the market you’re hoping to enter.
3. What is your competitors’ cost of sales?
Do some legwork to figure out your competitors’ cost of sales. This knowledge can provide clues to their pricing strategy. It may also give you valuable supplier information.
4. What is your competitors’ growth curve?
Do some research to learn where your competitors have been and where they are headed. What is their current market position?
5. Who is your competitors’ work force?
Dig a little more to find out about your competitors’ employees. For example, are they union or non-union? What positions are they hiring for? This can tip you off to potential changes such as a new product launch or company growth.
6. What is your competitors’ marketing strategy?
Investigate your competitors’ marketing strategy and brand strength. How do they market their products and what is their approach to advertising? What is their marketing spend and how do they allocate it?
Now what do you do with this information? Build a competition grid that plots your competitors’ data and compares it to your own. This can flag weaknesses in your competitors’ strategy and reveal gaps to be addressed in your own position.
Creating a competition grid
A competition grid is an effective way of comparing your value proposition with those of your competitors. Your own grid can vary in layout, size and complexity, but a simplified example might look like this:
|Competitor and Product
|Acme Oil and Gas Co.
|XYZ Widget Corp.
|ABC Services Inc.
Next, fill in as much as you can using the information uncovered in your scan. This will help you evaluate how and where your product can fit into the market. When your grid is complete, you can easily explain to potential customers why they should do business with you and not your competitors. That’s your USP.