By Shannon Belew, Joel Elad

Your online business is typically not the only player in your market that’s having an effect. Therefore, to see where you’re going in your industry, you must learn from the fellow companies in your industry. After all, you can’t compete if you don’t know what the other players are doing. Your customers will compare you to the competition, so know where you stand and update your plans accordingly.

Stealing a page from your competitor’s playbook

Evaluate your competitors and understand how their marketing strategies are reaching consumers and affecting their buying decisions. Start by identifying the largest companies in your area that directly compete with you for customers, and then move on to companies that indirectly compete with you.

Always be informed of your competitors’ new promotions by signing up for their newsletters and promotions. Use a free e-mail account from Gmail or Yahoo! so that your competitor doesn’t see your company’s website on its e-mail list.

As you scope out your market, start developing a sense of the overall feel that your competitors present as their marketing message, and look at the ways they use to communicate that message. Then ask yourself these questions to compare their strategies with yours in these areas:

  • Appeal of the campaign: What’s eye-catching, unique, or appealing about their messages? Are they more current or relevant than you?

  • Product selection: Do your competitors carry a bigger or wider selection than you, or do they focus on one niche?

  • Price and promotion: Where do your competitors’ prices fall in comparison with yours? Do they rely on pricing promotions to lure the initial sale?

  • Customer policies: What kind of return, payment, and shipping policies do they have? Are they more flexible or generous than yours?

  • Additional services: What bonuses do other companies offer their customers? Do they provide free delivery, gift wrapping, bonus items, or customization, for example? Do they offer something that you don’t, or can’t, provide?

  • Tactics: Are other companies sticking to the same marketing mediums as you are, whether it’s print (direct mail or coupons), TV or radio, outdoor billboards, or Internet marketing? Have they found some new, clever way to distribute their marketing?

When you evaluate your competitors, you begin to learn more about your own company and where you can play up your strengths and take advantage of any perceived weaknesses you find in your competitors. Making this type of evaluation regularly is a healthy strategy because your competitors are also evaluating you and changing their strategies. Make an honest evaluation so that you know where you stand — and not where you think you stand.

Updating your strategy for survival

Adding a marketing message to stay competitive is different than updating your campaign to compete more effectively. If your customers see a new technology or offering as essential to doing business, you need to add the same element to effectively compete, not just stand out.

When real-time credit card processing on websites was unveiled, it was a cool bonus for customers who could pay instantly after ordering a product rather than fill out a form online and wait for the e-commerce owner to process the credit card at a later date.

Now, if an online retailer doesn’t process the customer’s credit card instantly, its customers see the business as behind the times and inefficient and leave for another online retailer that has real-time processing. Therefore, borrowing this technique becomes essential for survival.

This concept also applies to marketing strategies. If your customer base is mostly concerned with features, hammering a message about price makes you seem out of touch. Conversely, if you’re selling a product that people view as a commodity, you have to either make some alteration and focus on the difference or focus on the lower price you can provide.

Here are some ways you can differentiate yourself through marketing:

  • Combine products and services. Maybe you can extend a product you’re offering by adding a service that no one else does. Perhaps you can customize a clothing item you’re selling to match each customer’s wishes. This way, you make the product and your business more valuable to the customer.

  • Package different items. Rather than be a retailer of goods, be a solution provider. Combine different products that fill a similar need into an all-in-one solution for your customers. They will pay for the convenience of putting everything in one basket and reward your business for supplying their needs.

  • Extend an offer. If you can extend a promise to your customers, use it as your message when you market yourself. Domino’s became known as the pizza place where your order is delivered in 30 minutes or less or your pizza is free.

  • Conquer a niche. Maybe an area of the market isn’t being properly served. Even if your business goal is to serve more than one niche, conquering an area gives you a hook for doing business. A customer might say, “Oh, yeah, that’s the place that handles the small-business market well. Hmm, maybe I should think of it for my business.”

  • Provide a personal touch. Sometimes, the little things make a big difference. If you do something unique that benefits your customers, they remember you for it. For example, an antiques seller includes a little homemade gift with every order she sells online. Some of her customers become more excited now when they order because they can’t wait to see their cool gift.