You don’t have competitors when you’re the best marketing podcast B-)
To succeed in business, you have to know and understand your competitors! Let’s talk about how to do that!
This month I am plugging the St. Louis chapter of the AMA. To become a member, you can visit https://amasaintlouis.org/.
Sources:
Adapted from this list: https://www.indeed.com/career-advice/career-development/basic-marketing-questions
https://www.nytimes.com/2020/03/25/nyregion/coronavirus-nyc-taxi-drivers.html
The Marketing Gateway is a weekly podcast hosted by Sean in St. Louis (Sean J. Jordan, President of https://www.researchplan.com/) and featuring guests from the St. Louis area and beyond.
Every week, Sean shares insights about the world of marketing and speaks to people who are working in various marketing roles – creative agencies, brand managers, MarCom professionals, PR pros, business owners, academics, entrepreneurs, researchers and more!
The goal of The Marketing Gateway is simple – we want to build a connection between all of our marketing mentors in the Midwest and learn from one another! And the best way to learn is to listen.
And the next best way is to share!
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Copyright 2025, The Research & Planning Group, Inc.
TRANSCRIPT:
So as we continue on talking about the top questions marketers ask, we’ve reached a point where we need to stop thinking about how to position and sell our products or services and begin considering how those offerings might do in a competitive marketplace.
And while it’s really easy to understand who your competitors are if you’re in a mature, well-defined market with established players, it’s a lot harder if you’re a small business or if there are substitution products that allow people to bypass the need for yours.
Let me offer an example. If you drive a taxi in New York City, you might view your competitors as rideshare services and mass transit, because those are the two services that are predominantly going to take away your business and give it to someone else.
If you’re savvy, you might also consider people who carpool or hitch a lift from a friend or who utilize alternative forms of transportation like bicycles or scooters or just plain old walking.
But your biggest competitor might be people deciding they’re just going to stay home.
And before you scoff, let’s think back to the year 2020 when taxi drivers in New York City experienced exactly that. In the first quarter, people were still using taxi services to get places.
But as soon as the shelter in place order went into effect, taxi companies had so little business that drivers would wait hours just to pick up a single fare from the airport and rides dropped as much as 91% on the weekends.
Taxi drivers were going broke due to the lack of business, and even signing up for rideshare services or delivery or courier services couldn’t help them make ends meet.
Staying home was the competition no one really thought about. And even as New York City did come back to life, the taxi industry was forever changed, as were many others that serve the people in the city.
So as we talk about competitors today, we also need to talk about the forces that enable competitors to thrive. Because the biggest competitor of all is a lack of need.
I’m Sean in St. Louis, and this is the Marketing Gateway.
So, how do you determine who your competitors are? It’s really not too hard.
Find a customer and ask them.
This might sound simple, but it’s a really instructive exercise, because often, the customer will tell you something you’d never considered.
For example, let’s say you’re in the business of making healthy pre-packaged snack foods for vending machines and convenience stores.
Your target market is people who are health-conscious and who want to make better choices when they’re out and about, and let’s say, for our example here, you’ve got a corner on this particular market with no close competitors offering a similarly healthy product.
So, who’s your competitor? You might assume it’s junk food as your core customers tell themselves, “it’s OK to cheat today” and go for a donut or a candy bar or bag of chips instead of your healthier alternative.
It’s a reasonable assumption. But then you go and talk to your customers and they shudder at the thought of putting that stuff into their bodies.
“I make my own snacks at home,” one person tells you. “It’s a lot cheaper and it’s pretty easy. I only buy your snacks when I’m pressed for time.”
“I don’t eat a lot of snacks,” another person tells you. “But some days, I’m run down and I just need to grab something to keep me going. That’s when I buy your snacks.”
“Honestly? I buy them just so I don’t have to think about whether I want the other options,” says a third person. “I keep them in my desk in case I have a long meeting or have to work through lunch. They’re guilt-free emergency snacks, you know?
But they’re just OK. Not much flavor. I don’t even eat them half the time. I’ve given a bunch of them away.”
Ouch. Those purchase decisions aren’t nearly as compelling for showing strong competitive marketplace performance as you might think, and it really sounds like you’re not winning the fight against junk food – you’re just the stopgap to keep health-conscious people from going hungry when they’ve got a busy day.
In this scenario, your competitors aren’t represented by some huge set of options. The choices are narrow – healthy snacks or nothing at all.
And knowing that might really change the way you market your product, right? You might even worry – and rightly so – that if a better healthy snack came on the market and started competing with you, it’d literally eat your lunch. Or be eaten for lunch. But anyhow.
Of course, competitive landscapes are rarely this clear-cut, and so in the field of marketing, we have a couple of different frameworks we can look at to understand who our competitors truly are.
One of those is a model that comes from the field of consumer behavior that suggests that when consumers are presented with a need, they conjure up a bunch of known alternatives, narrow things down to the ones they’d actually consider and then decide which one to choose.
The alternatives that come to mind when a need arises are known as the “evoked set,” and marketers spend a lot of money trying to be one of those choices, particularly in a crowded marketplace with lots of choices.
Here in St. Louis, for example, there are well over 140 bank and credit union brands. No consumer is going to be able to think of all of them if they need to open a new checking account. At most, probably 5, 6 or 7, maybe as many as 8 or 9, will come to mind.
And then of those, the ones they’d actually consider – that’s the “consideration set” – would narrow things down by half or so. Probably 2, 3 or 4 really good options, maybe another one or two that are quickly decided against.
And from there, they’d make their final choice.
So there’s a lot of potential to understand who your competitors are by asking customers, “who would you think of? Who would you actually consider? And who would you choose?” And in fact, this structure is a pretty standard line of questioning in marketing research.
But the problem is that this framework tends to assume that consumers are comparing similar brands to one another. Let’s ignore alternatives like cryptocurrency wallets or stuffing your money into a mattress for a moment.
What if a Fintech company is offering customers a chance to put their money into interest-bearing money market accounts and spend those funds like cash using a credit card-style account that withdraws funds when it’s time to pay?
That’s a legitimate competitor that probably isn’t being captured by this exercise because it’s different from the conventional understanding of what a bank or credit union looks like. It could even become a disruptive alternative to traditional bank accounts.
And in order to understand whether or not these sorts of alternatives are going to become a true competitor, it’s important to conduct a competitive analysis.
So the framework for a competitive analysis is this. You spend some time gathering data from your customers, employees, stakeholders and friends to understand what people generally view as being the key players in your category.
You start sorting these different competitors into three buckets depending on their level of direct competition with your business.
Let’s use a boutique-style retail store selling fancy dresses for proms, quinceañeras and formal events as an example.
Those that seem to be serving a different clientele get tossed in the first bucket. These are competitors you don’t need to worry about.
This would be stores that sell dresses, but who aren’t focused on the fancy sort you’re selling. They pose no threat, and they might even be a valuable source of revenue if you can build a referral relationship with them!
Those who seem to be serving your customers as a secondary or tertiary market rather than a target market get tossed in the second bucket. These are competitors who siphon off some customers, yes, but who aren’t that serious about the category.
Department stores or mall stores that have a few fancy items would be a good example here. And those customers still might not be the folks who’d shop at your store. They’re going to serve the sorts of customers who are less discriminating and looking for bargains more than those who want quality and service.
But another dress shop that specializes in prom dresses and weddings? They’re probably a direct competitor, even if they aren’t necessarily focused on those other events you also carry products for.
They’re going to be focused on the same target market, they’re going to be competing more directly on price, quality and service and, most important of all, they’re going to be trying to get the same people you want in your store to come into theirs and consider what they have to offer instead.
Of course, there’s some nuance here. Not all competitors are bad for business! If that shop is next door to you, they may be a competitor, yes, but they could also be helping you both draw in more customers by having two choices in one place.
And so you may find that your relationship is symbiotic and you can each specialize in different styles and needs. Believe it or not, this happens all the time in shopping centers and it works out for the benefit of both businesses because consumers like having choices that don’t require them to travel very far.
And if they’re across town and it takes an hour to get there, they may be a competitor in some respects, but you’re both going to be serving a lot of nearby customers on your respective sides of town and really just splitting the business between people who are really picky about what they want.
You may again develop a friendly relationship where you send customers back and forth if you find you can’t serve them.
The competitor you really have to worry about is the one that’s attempting to exert its own gravity on your business and to pull people away from you and towards it instead. This would be what I’d classify as an aggressive competitor – one that exists to not just exist in the market, but to conquer it.
This is the sort of tactic that big box stores like Walmart are often accused of using by coming into town, offering impossibly low prices and great selection, and then siphoning customers away from existing businesses who can’t hope to compete on anything but service and premium products.
And if a big box store moves in and starts offering fancy dresses that undercut your own business, they’re going to make your customers expect lower prices and more selection.
That sort of competitor is very difficult to deal with, and staying in business often requires being a very savvy marketer who can persuade customers that higher prices mean better quality and superior service.
But beyond local brick and mortar stores, your dress shop could have other competitors as well. Online retailers are an obvious source of direct competition – and they are a quite serious one if they’re able to offer comparable products at lower prices!
The downside of online shopping, however, is that online retailers generally can’t provide much in the way of service. You can’t try their goods on, you can’t get alterations made, and waiting for products to ship can be problematic, especially on a tight timeframe.
So these sorts of competitors are often also thwarted by a focus on quality and superior service.
But once you have your list of direct competitors in hand, it’s important to become an expert on them. Visit their websites. Get ahold of their advertising and review it. Visit their stores and conduct a mystery shop where you try to learn more about them.
Pay attention to their suppliers, products and promotions.
Hire their former employees and see if they can help you grow more competitive. And see if you can get customers to open up about their experiences shopping elsewhere so you can see what you can do to make your business better.
That’s what a competitive analysis really involves. Gathering information, synthesizing it, using it to guide continual improvement and keeping yourself competitive.
The businesses that don’t know or understand their competitors tend to be the ones that don’t make it when competition gets fierce.
I’ve seen it happen many times at all levels of businesses – those who cannot identify who their competitors really are and who can’t ensure that they’re staying current in the products and services they offer are just waiting for their customers to make a big change.
And if you don’t feel you have competitors – and maybe you don’t, especially if you work in professional consulting services like I do! – just remember that finding an alternative to your product or service is just as much a source of competition as another organization that looks like yours.
Remember – your customers are the most valuable source of information you have about who your true competitors are. So don’t be afraid to ask them. They often will tell you as long as you’re not weird about it.
Because it’s important to be in that evoked set and consideration set, sure.
But it’s even more important to show your customers that you care enough to want to be able to continue to serve them when those other alternatives aren’t around anymore.
I’m Sean in St. Louis, and this has been The Marketing Gateway. See ya next time!
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