Many service businesses find themselves in a crowded marketplace. If you're serious about your business then you really want to be focussed on leading your market. As an SME in a competitive space this may be a daunting prospect. But like all journeys it starts with the first step. In this post we explore the first step in detail.
Running a digital marketing agency being in a crowded marketplace is a position I understand well. We are in a busy sector, with loads of companies large and small offering a very similar selection of services. Whatever type of service business you're in the chances are that you'll find yourself in a similar position.
Over the time that I have been running LexisClick, the businesses that we work with who are most successful are the ones that are leaders in their market. This has been especially evident during the downturn where these clients grew from strength to strength. In my experience becoming a market leader comes down to three choices.
The 3 options for making your business a market leader
- The first is to grow your company to being the leader by developing your business faster than the competition. This route to success will be dependent on both strategy and funding.
- The second is to be the best, the primary difficulty with this this is how you measure it. Plenty of companies say that they are the best, but it is really meaningless unless it is measurable and evidenced.
- The third is to move into a much less competitive space and in the ideal world an uncontested space. This third option reduces the competition to such a significant extent that being the best is much more easily defined.
For most SMEs it is this third option that is the most realistic and therefore the most popular choice. As the most popular option, it is the one that I'll elaborate on further in this post.
In my experience a deep understanding of your market and your competitors is an incredibly valuable asset when creating and running a winning marketing strategy. I appreciate that sounds like basic common sense, but you’d be surprised at how many successful businesses I come across who hold very limited information on their competitors.
If you can't truly differentiate yourself from your competitors you're making your life very difficult. Really you want to be able to count your competitors on one hand and maximum on both hands. I understand that for some of you this is going to be difficult. (I have exactly the same issue. At a broad level I have approximately 150 competitive businesses in a 20 mile radius of our offices and we're not based in a city!) With this in mind I have come up with some simple steps you can follow to start defining your market.
Step 1 in defining your market space. Identify your goals and objectives
- What are your goals and objectives for the business?
- What are your personal goals and objectives?
Step 2 - Identify the opportunities in your business
- What are our most profitable services?
- Who are our most profitable clients?
- Where do we do our best work and would love to do more work?
- What do we think are the best opportunities in our business?
Step 3 - Explore the opportunities
- If you were to focus on your most profitable clients and profitable work only?
- What would your ideal client look like?
- Would you be doing your best work?
- How would you define the business and service that you offer? (Market space definition)
- How many clients would you need to meet your goals and objectives for the business and personally?
- If you were to focus on your best work only?
- What would your ideal client look like?
- How would you define the business and service that you offer? (Market space definition)
- How many clients would you need to meet your goals and objectives for the business and personally?
- If you have identified opportunities different to your most profitable work or best work, go through the process for your best opportunities.
- What would your ideal client look like?
- Would you be doing your best work?
- How would you define the business and service that you offer? (Market space definition)
- How many clients would you need to meet your goals and objectives for the business and personally?
Step 4 - Identify the level of competition in your opportunity spaces.
Take your market space definitions from step 3. When you define your market in this way how many direct competitors are there?
You may well find that you have none or very few. If there are still a few left, how confident are you that you could be the best in that market and achieve the business and personal goals that you have written down?
If you are still up against some stiff competition, run through the questions above again and narrow everything down further. If you have the confidence and belief that you can be the best in the market you have defined, the chances are you have found your space.
From my experience of going through these simple steps with clients and for my own business, you'll have a very high chance of successfully finding your space.
Step 5 - Develop your marketing strategy
When you have found your space, your next challenge will be to make the move. The place that you will need to start is to develop a marketing strategy and plan for making the move. Which for most of us in senior roles, is an exciting prospect.
So go on and get stuck in, create your strategy to becoming a market leader. It is essential that you research the market you have defined. Make sure it really exists and that it is sufficient to support your business and personal goals. Also make sure there aren’t any hidden competitors. In some markets there will be powerful incumbent suppliers who may not be obvious from surface research.
Step 6 - Test and refine
When you have developed your marketing strategy with a now clearly defined market space, it's time to test the market. This can be done by assigning the test to a team in your business or by setting up a dedicated website and marketing campaign. As you test the market space and your strategy, you’ll develop a much deeper understanding of it and how likely it is to succeed. You want to test to make sure the market is sufficiently strong to support your business and personal objectives. You also want to test your marketing strategy to identify any weaknesses in it that can be improved.
Step 7 - Commit and focus
We all know that to become a market leader, even in an uncontested space takes commitment and focus. It is highly likely that you’ll need to refine and redefine your business to ensure the focus required to achieve your success goals. If you are starting from an existing business this focus and commitment often appears risky. The reality is that it is more risky not to focus.
If you are finding it hard to focus and commit. Ask yourself whether you have really understood the market and tested it and from this refined your success strategy? If you haven’t go back to step 5.
At LexisClick we have developed a powerful tool to help with this process, you can request a consultation to go through it with one of our Marketing Consultants.
