How Does Your Business Stack Up Against Competition?
As business owners (and humans) we are often tempted to compare ourselves. We measure our success or failure based on what we assume others (often chosen arbitrarily) are doing, having, and being.
One of the best pieces of wisdom I received when I started my first business was from another business owner who had been in the boutique fitness industry for several years.
He told me something that stuck. He said, “Shannon, you will never know if you are more successful than your competition unless they show you their books. You might think their classes have more attendance, or their Instagram account looks better than yours, but maybe they have a really crazy rent, or a personal loan looming over them from a gambling problem, or they spend too much money on an advertising agency to put pretty pictures on the Internet. A pretty picture on the internet doesn’t mean a business is profitable.”
Understanding your market is an important part of running a business, but making assumptions by comparison, especially when those comparisons are not based in fact, but in feeling, is only going to take you to bummer town.
Instead of focusing on what everyone else is doing differently and/or better, your energy is much better spent focusing on improving your own offerings and growing your community.
I am not, however, suggesting you operate in a bubble. Here are some ways to stay in touch with what the market demands without falling into the comparison trap:
- Finding a mentor who can share with you behind the scenes insight on how to improve your business model. (In Richmond, I suggest SCORE or Thrive)
- Reach out to other business owners in your industry to have a support network of people who are working towards similar goals. (I am part of a FB group Boss Babes RVA)
- Specifically ask your customers to provide feedback on why they buy from you.
- Look at businesses that serve your customer (outside of your specific industry, meaning not direct competition) to understand the pricing strategies and communication styles they are using.
- Looking at a beautiful Instagram account and assuming the business is profitable.
- Comparing your business to a business that is significantly younger or older.
- Assuming everything listed on a competitors website is selling.
- Not specifically defining what success means to you in your business.