International markets can be fiercely competitive and the companies that succeed in them are formidable opponents. If you want to get the competitive edge, you’ll need to know as much as possible about your competition and the customers you’re competing for.
Finding and qualifying new overseas customers can take a lot of time and resources. That’s why enlisting experts is a good idea. The following strategies are often useful:
- Join your industry association in your target market and/or in Canada to help you connect with potential customers abroad. This is one of the hidden keys to networking.
- Attend trade shows in your target market, either as an exhibitor or a visitor. This helps you introduce your products to many potential buyers in just a few days.
- If you’ve already developed a basic export plan for a target market, contact the Canadian Trade Commissioner Service (TCS). The TCS can help you assess market potential and find qualified contacts.
- International sales are inherently more risky than domestic ones, so conduct careful due diligence on a buyer using EDC’s Company Insightful tool before striking a deal. If non-payment could be an issue, consider using EDC’s Credit Insurance to protect your receivables.
Collecting good competitor intelligence helps you decide whether your product or service can outclass its competition in the target market. You can:
- Consider hiring a specialist consulting firm to analyze potential competitors and the competitive environment in your new market—the price of the report may be a good investment. Your trade association’s publications may also provide useful intelligence.
- Track your competitors’ social media presence to pick up information about their activities and see what their customers are saying about them.
- Examine their marketing materials and annual reports to glean useful intelligence.
- Attend trade shows to examine your rivals’ products and capabilities.
As you analyze the information, look for evidence that exposes your competitors’ objectives and weaknesses, and reveals any threats to your position. For example, are they:
- Merely trying to maintain their market share or trying to become a market leader?
- Maximizing short-term profits or staying in for the long haul?
- Introducing new products or sticking with their existing wares?
- Using tactics such as deep discounting?
- Struggling with their existing competition?
Understanding their goals and behaviour will help you tailor your own competitive strategies.
Your competitor intelligence can help you assess your product’s appeal to local customers and deal with threats from the competition. A strengths, weaknesses, opportunities and threats (SWOT) analysis is often used to do this.
Competitive strengths of your product:
- Its unique features and special capabilities
- Top-quality customer service and guarantees
- A price advantage because of low production costs or other factors
- Ease of ordering and delivery
- Low awareness of your company and product among potential customers
- Your own unfamiliarity with your competitors’ products and/or the international market itself
- Lack of funds to support your product in the new market
- Incorrect pricing
Lack of objectivity can lead to trouble if you overestimate your product’s appeal or underestimate the strength of the competition.
Opportunities could arise from:
- Being first to market with a new product/service (the appeal to early adopters)
- A decline in a competitor’s performance
- Economic/market trends favouring adoption of your product
- Having new technology your competitors lack
- Competitors with new or improved products
- Competitor responses that undercut your position
- Regulatory changes that adversely affect your product
Many companies don’t use SWOT tools because they assume, with little evidence, that their offerings will be able to compete abroad. This lack of objectivity can lead to trouble if you overestimate your product’s appeal or underestimate the strength of the competition. To avoid this, do a careful SWOT analysis and use it to plan how you’ll market and sell your product in the overseas market.
A USP summarizes what makes your business and its products unique and valuable within your target market. It can be developed from the results of your customer and competitor analysis, and should tell potential buyers:
- How your product can solve their problems
- What unique features and benefits they can expect from your product
- The extra value your product offers over that of your competitors
- How you can support your claims (through testimonials and case studies, for example)
To be truly competitive, it’s important to understand clearly how and why your company and its products surpass what other businesses are offering. By developing an effective USP and training your staff to use it as marketing and sales tool, you gain an edge over companies that don’t have a USP.
Introducing new products and improving existing ones is vital to maintaining your position in the global market. Doing so not only attracts new buyers, it helps keep your existing customers engaged with you and thus less likely to turn to the competition.
Seeking and entering new markets is also important. Such diversification increases your customer base and your revenues and reduces risks to your competitive position. If one market has a downturn, for instance, the others can make up for it. As an added benefit, entering new markets can force you to innovate. This will enhance your ability to compete.
Six tips for staying globally competitive
- Don’t depend solely on your own resources to find and qualify international customers. Get help from sources such as the TCS.
- Use market intelligence to investigate your competition in the market.
- Use SWOT tools to evaluate your position relative to your competitors.
- Develop a USP to use as a marketing and sales tool.
- Keep upgrading your products and developing new ones.
- Diversify by expanding into new markets.