Who stole your users?

When we are doing product or brand marketing , it is very important to find out who your real competitors are so that you can make countermeasures in advance to retain users.

For example, if a restaurant has fewer and fewer customers, many people might think that the restaurant across the street has stolen their customers.

But when the store opposite was closed, the number of customers in his store did not return to the original number.

Since it wasn’t the store across the street that stole their customers, then who stole these customers?

If you don’t even know who has taken away your users, let alone what marketing strategy to adopt.

One of the prerequisites for a good marketing strategy is to first understand who your product’s competitors will be and make countermeasures in advance.

For example, if you know that your store’s competitors are not just the store across the street, but also food ordering platforms such as Meituan / Ele.me , then you cannot just use price wars to do marketing. You may also have to consider enhancing the experience of your offline store (attracting users who like to order food with Meituan to consume in the store), or cooperating with Meituan/Ele.me and other platforms, and other measures to prevent customer loss.

Is there any way to better discover who your competitors are?

In this article, Monster will share with you an analysis tool that will allow you to find your competitors more comprehensively - the Porter Five Forces Model proposed by Michael Porter.

That is to say, your product will generally face the influence of at least five competitive forces.

They are:

Direct competitors in the same industry

Threat from potential new entrants

Substitution ability of substitutes

Bargaining power of buyers

Bargaining power of suppliers

The greatest function of the Five Forces Model is that it can broaden our scope of thinking - knowing who the competitors of our products will be, making countermeasures in advance, and increasing the accuracy of marketing strategy execution.

For example, in the past you only knew that your store’s competitor was the store across the street, but through the analysis of this model, you found that there are also invisible competitors such as food ordering platforms, raw material suppliers, and consumer perceptions.

Below I will explain the five forces competition model in detail and share the corresponding countermeasures with you so that you can find out who your competitors are more comprehensively.

1. Direct competitors in the same industry

This type of competitor is easy to find and is also our most common competitor.

For example, if you run a western restaurant and a western restaurant opens across the street from you, this restaurant is your competitor in the same industry.

In an increasingly mature category market, there will be more and more direct competitors in the same industry.

For example, when it comes to mobile phone products, the ones that people often hear of are Apple, Huawei, Xiaomi, vivo , oppo , etc., but there are also mobile phone brands such as Hammer, Meizu and OnePlus. It can be said that there are many direct competitors in the mobile phone industry.

Faced with these direct competitors, is there any good way to retain your users?

There are many methods. Here I share one method - find your own differentiated core competitiveness instead of competing with other strong competitors to see who does better.

For example, if you are also running an e-commerce platform, you don’t need to create a platform with more categories and cheaper prices than Taobao , but to find out what other entry points Taobao and others have not done well.

For example, Vipshop 's global brand sale model and Jumei's focus on cosmetics are both differentiated practices from the Taobao platform.

In addition to improper operations , one of the important reasons why many e-commerce platforms failed in the past few years was that they blindly used their own shortcomings to compete head-on with Taobao's strengths. Because resources are limited, it is more effective to adopt a differentiated strategy (rich brands please skip this~).

2. Potential New Entrants

You originally sold fruits, and suddenly another fruit store opened nearby. This store is the new entrant. Before they come in, these are your potential new entrants.

So, what strategies should be adopted to deal with these new entrants?

Here is a method to share: while strengthening your own advantages, add value-added services and raise the threshold for new entrants.

For example, in order to prevent new stores from stealing your customers, you can maintain or enhance the freshness of your fruit shop and offer door-to-door service within XX hours. If you think the cost will be high, then before new competitors enter, consider adopting a membership system to bind your own users to prevent them from being snatched away by new entrants (for reference only).

For example, SF Express emphasizes faster delivery speed. While strengthening our own advantages, we provide more additional value-added services.

For example, they can provide door-to-door collection within 1 hour (other express delivery services generally take 2 hours) or provide value-added services such as free express packaging boxes to retain their users and raise the competitive threshold for new entrants to enter the "faster delivery" market.

Of course, if you are in the same business district, you can also adopt alliance marketing - that is, form an alliance with existing peers to raise the threshold for new entrants to enter the area (this approach is only applicable to regional business districts).

In short, raising the entry threshold is one of the effective ways to prevent new entrants, for reference only.

3. Substitution Capacity of Substitutes

Substitute products are products or services that users can use to replace your product.

For example, the sales of instant noodles have declined in recent years, and a big reason for this is that healthier fast foods and food delivery platforms have replaced instant noodles.

The emergence of online social products such as WeChat can also be regarded as an alternative to China Mobile/China Unicom SMS products.

There are many strategies that can be adopted when facing competitors with substitute products. Here I share a method introduced in a previous article - the product addition strategy. That is, the product increases more relevant demands and makes users feel more comfortable, happy and thoughtful than alternatives.

For example, some users think that chewing gum products have too high a sugar content and are not good for health, so they buy other products as substitutes. Later, Extra launched xylitol chewing gum to reduce users' concerns about high sugar content, allowing users to continue buying your products instead of substitutes.

4. Bargaining Power of Buyers

Buyers' choice and bargaining power are also a form of competition.

For example, if you run a coffee shop, your buyers may include low- and middle-income groups who like cheap coffee, middle- and high-end petty bourgeoisie groups, or white-collar groups, etc. If they do not choose to shop in your store, these groups will have the possibility to bargain for your products, and you will naturally reduce the profit of your products.

If no one buys your stuff, many people will often lower their prices, causing business to get worse and worse. Because your buyers have bargaining power.

How can we avoid this influence and improve our business?

You can also adopt the approach of finding your own differentiated competitive strengths and strengthening them.

For example, after analyzing the characteristics of the local population, your coffee shop takes white-collar workers as the main target users , positions itself as a budget coffee shop, and continuously strengthens this positioning to form strong differentiated competitiveness in the local area.

Even if not all people come to your store to shop, you will have your own high-stickiness buyers because of the strong differentiation of your store - reduce the bargaining power of buyers, and then use other methods to better retain users.

5. Bargaining power of suppliers

The suppliers of your products are also invisible competitors who influence the success of your business and user choices.

For example, if you run a restaurant, and your supplier of raw materials serves many customers like you at the same time, then this supplier will have room for bargaining.

At this time, you are a passive recipient, which will naturally affect the cost of your product; thus, your product has no price advantage and is prone to losing users - at this time, you'd better be prepared in advance.

For example, you can find a few more suppliers that are more suitable for you, or sign corresponding long-term cooperation agreements and other measures to reduce the impact of suppliers on you.

Similarly, similar problems will be faced when it comes to the source of products for e-commerce or WeChat businesses.

For example, if you are running an e-commerce store selling a certain type of clothing, when choosing a supplier of the clothing, if the source is single and there is no guarantee such as a cooperation agreement, it is easy to fall into a passive choice (the supplier says the cost price, and you have no choice but to accept it).

Therefore , make more use of Internet channels or offline wholesale markets to find suppliers that are more suitable for you - increase your own choices, improve product competitiveness, and attract more consumers to buy your products.

6. Notes

Of course, real business is more complicated, and this article only analyzes product marketing from the perspective of market competition.

For example, if business is bad and users no longer buy your products, in addition to the influence of your own enterprise and the "five forces", there are also macro-environmental factors such as politics, economy, society, and technology (and possibly more).

It is necessary to constantly discover and make judgments based on different situations.

With the development of the commercial society, some people later proposed the "Six Forces Model" and so on (proposing corporate complementarity, mutual cooperation, etc.).

In any case, the most important thing about this "Five Forces Model" is that it provides us with an additional scope for thinking, so that we can know who our product's competitors will be, prepare countermeasures in advance, and increase the accuracy of marketing strategy execution.

For example, in the past, you thought that the only competitor of your restaurant was the restaurant across the street. Now you understand that there are also food ordering platforms such as Meituan Waimai and changes in consumers' consumption concepts, which may be your "competitors" that steal your business. At this time, you can discover them early and take countermeasures in time - for example, cooperate with platforms such as Meituan/Ele.me, or improve the offline store experience to attract/retain consumers.

The author of this article is @怪兽先森 and it is compiled and published by (青瓜传媒). Please indicate the author information and source when reprinting!

Product promotion services: APP promotion services, advertising platform, Longyou Games