Our small company is doing well selling a unique product, but several competitors are breathing down our necks, and I'm getting nervous. How can I anticipate my competition's next move and stay ahead of the game?
Shrewd entrepreneurs understand that their products will one day reach the end of a development cycle, hit a point of market saturation, or be changed by technological innovations. That's why they must use some portion of their budgets to conduct strategic research and market testing that will anticipate ways they can shape their product, their marketing—or both—to change with the times.
Staying meticulously well-informed about your industry, and the outside forces that are changing it, will go a long way toward calming your nerves. Without having all the knowledge, you're shooting in the dark when it comes to adapting to the changes that are inevitable.
Developing solid industry expertise will take your focus away from worrying about what your competitors are doing and redirect it toward making your product and your company nimble enough to adapt to change quickly and seamlessly.
Moving With the Trends
How do you get to be an expert not only on your product but also your market and the larger industry? You must do continual research, starting right in your own backyard.
Talk to your current customers, one on one when you can, and through a short feedback form that you can place on your Web site or in your product packaging. Be sure to offer an incentive for customers who complete and return the form. If possible, develop a community around your Web site through a blog or forum that draws your customers in continuously to get additional information about your product and how to use it, and to find news about your industry.
Staying in touch with your end-users is invaluable, says Frank Stokes, a business consultant with Los Angeles-based Stokes Pacifique. "You will be better-equipped to move with the market trends through effective planning, and you will identify paradigm shifts, gaps, and opportunities to market," he says. "Mastering change prepares you to take on new challenges with focus."
Keeping up with the latest books and articles being written in your industry will help you find out about best practices and new opportunities as well. Subscribe to the relevant trade publications and blogs, join professional organizations, and—perhaps most important—attend trade shows that relate to your market niche. Networking with your competitors and your customers at trade shows gives you invaluable insight into where they are taking their products and services, Stokes says.
Be Open to Success
"Be prepared to reinvent yourself and your core business with the understanding that you may gravitate into new businesses that do not exist today," he advises. You may also reach the conclusion, at some point, that it's time to sell your business—rather than being forced out. Knowing when the time has come, and moving ahead of the game, into a sale or merger will put you in a position of strength, rather than one of defeat.
"Six years ago, there was no iPod…and 3M started as the Minnesota Mining & Manufacturing Co. We now know 3M (MMM) as the "Post-It" company. Take a page from 3M and develop new ways to generate income. Each year, they expect 20% of their revenue to come from new products. Apply ingenuity, and keep your eyes and ears open for your next success," Stokes says. Good luck!