In spite of the current economic environment, people are still buying products and services. However, with sales volume lower and margins tighter than they have been for a while, competition for each piece of business is substantial. Competitor analysis using your CRM system can give you a significant competitive advantage and this could be pivotal to success.
The key to beating competitors is to be a little bit better than them and to work a lot harder than them. Knowing who your competition is and what their strengths and weaknesses are can only help you. However in order to gather the information to carry out competitor analysis there is an internal cultural change needed as sales people need to begin to ask who they are against in terms of competition. Making this standard practice can take a bit of getting used to.
Customer Relationship Management (CRM) Solutions can be used as a central point for storing information about your contacts and competitors, giving all your employees the ability to access key data when they need it. Once you have a CRM system you can record all information relating to an opportunity, but you need to ensure you link each opportunity to competitor records in CRM.
- If you win the deal, the CRM system will know who you have beaten
- If you lose the deal, you need to tell the CRM system which competitor won
This will give you enough information to begin competitor analysis. For example, how many times have you been beaten by and in turn won against each competitor. Is one competitor dominating your market?
Building Intelligence and using it
Once you have a CRM system in place and each opportunity is linked, you can start to build up more detailed and useful information. You can record why you lost an opportunity, what solution you lost it to and who you lost it to, for example:
When you win or lose an opportunity start recording why? This is easier to do if you use a series of standard responses, which will make analysis easier. These could include: "price", "reference ability", "better product", "geography", "better presentation".
If you are in a market where you are not up against like-for-like products or services then try to find out what it is your competitor is selling.
Record who won each sales opportunity. If you use all three of these in conjunction then you will be able to get a clear picture of who you key competitors are and what you need to improve on.
CRM Can help
In order to facilitate this type of competitor analysis, you need to have a reliable, company-wide system and the internal culture to ask for the information, record it and analyse it.
A well thought-out properly designed and implemented Customer Relationship Management System can help you with this, putting processes in place and giving you the tools to explore and exploit your data.