Competitor Profiling Secrets © Jeff Miles

Competitor analysis is an important element of corporate strategy. Compiling a profile of your competitors should be done regularly and systematically.

According to Michael E. Porter, author of Competitive Strategy: Techniques for Analyzing Industries and Competitors, most corporations don't do this enough and instead rely on "informal impressions, conjectures, and intuition gained through the tidbits of information about competitors every manager continually receives."

 

Competitor profiling provides the following:

 

1.  Reveals weaknesses in your competitors' strategies and these are weaknesses that you can, in turn, exploit.

2.  Helps you predict how your competitors will react to your strategies and strategies of other competitors.

3.  Makes your firm nimble in the marketplace because, as you plan, you'll be able to dodge your competitors. Both offensive and defensive strategies can be put into play more quickly.

 

A competitor profiles also

 

Other firms are doing competitor profile on you, too, remember. So the more advanced and the more systematic your profiling is, the better. Just like in chess, a good offense is the best defense. By constantly remaining one move ahead, checkmate is that much closer.

A good profile gives in-depth detail about the competitor's finances, products, personnel, history and more. This includes:

•    Financials

•    P-E ratios, dividend policy, and profitability, financial ratios, liquidity, and cash flow

•    Profit growth profile; method of growth (organic or acquisitive)

 

•     Background

•    office locations, plants, and website

•    history (key personnel, dates, important events, and trends)

•    ownership, corporate structure, and organizational structure

 

•    Products

•    products offered, depth and breadth of product line.

•    new products under development, new product success rate, and R&D weaknesses and strengths.

•    brands, brand portfolio, brand awareness and brand loyalty.

•    licenses, trademarks, and patents.

•    quality control compliance.

 

•    Facilities

•    plant capacity, plant efficiency, age of plant.

•    location, shipping, and products by plant.

 

•    Personnel

•    number of employees, key employees, and employee skill sets.

•    strength of management and management style

•    compensation, types of benefits, and employee morale, employee retention rates

•    Marketing plans.

•    Market shares, growth rate, customer loyalty and customer base.

•    promotional budgets, ad agency used, success rate of the sales force, online promotional strategy.

•    distribution channels used, exclusivity agreements, alliances, and geographical areas covered.

•    pricing and discounts.

 

•    Corporate and marketing strategies

•    objectives and goals, mission statement, growth plans, recent acquisitions.

•    Marketing plans and strategies.

After you put together a profile have your business coach give feedback on it.

A profile is not a one-shot deal; it needs to be updated. Assign this task to someone and tell them the intervals at which this needs to be done.

Too often a profile goes into a file and is never looked at. So before making the profile make sure you know what decision needs to be made that requires a profile in the first place. There are, of course, competitor profiling consultants that you can hire to assist with this task.

What do you want to know about your competitors? What damage can they do to your business? What do you wish you knew about your competitors? Do a competitor profile and find out.