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I was recently teaching a seminar on marketing plans and of the 17 business people in the room, one was able to right away tell me who their competitors are. What does this mean?
Assuming these 17 people aren’t that different from other small businesses, this means there are a whole lot of businesses out there who don’t know who they’re competing against. And without knowing who the competition is, how can a business know if it’s measuring up?
It is a crucial part of a company’s marketing plan to know not only who the competition is, but also to know how you compare. What does the competition do better? What do you do better? What differentiates you? Once you can answer these questions, you know where you can focus your marketing and where you might need to improve.
Who is your competition?
I have a notoriously bad sense of direction. Anytime I drive into downtown Detroit, I inevitably get lost trying to get home. Then comes the call to my husband and the very frustrating, “I’m not sure exactly where I am” which makes it that much harder to even figure out how to begin to get home. You have to know where you are now to figure out how to get to where you need to be. This holds very true for driving. It also applies to marketing your company.
A marketing plan serves a number of purposes. One of the first and often underappreciated is that it helps you get an accurate look at where you are in the market right now. What services or goods are you really providing and to whom? Who are your competitors? How do you stack up against them? How much business are you doing? How much are you spending on marketing? What are some of the challenges you are working against? What are your strengths? Weaknesses?
Before you even start planning out what you are going to do to market your company, it is crucial that you can answer these questions. Much like it takes driving past a landmark to orient me and allow me to make my way home, you have to know where your business is now in order to take it anywhere.
What sorts of questions do you use to gauge where your business is now?
I spent this morning buying and then spreading mulch – again. Despite the fact that I spent several hours and sore back hours doing this just a few weeks ago, the beds are teaming with weeds. The reason… I was cheap. Instead of going with the 3″ of mulch the bags said it would take to fend off weeds, I used only half that amount. I saved money then, but ended up having to spend just as much money, with twice the amount of work and back ache. Cheaper isn’t always better.
The same holds true with graphic design. Say you know someone’s nephew who can “design” a logo in Word or put together a brochure. You might save some money on design fees, but is what you are getting worth those savings. You get that logo done in Word… chances are that it’s not the type of quality you’d get with a real designer. Also, you’ re not going to be getting a logo in the format you are going to need (high and low resolution, as well as vector). So in the end you’ll end up paying someone more to recreate your logo in the right format anyways.
If you scrimp on your other marketing materials, you might have all the information you want clients to see, but if it’s not designed well, chances are they won’t look at it. And so you may have saved money on the materials, but if they don’t get the message to your customers, and actually help market your business, you’re wasting your time.
Where have you been cheap that came back to haunt you later?
