If you have the impression that competition is a bad game, it is not true in every contest. Sometimes, competition is the motivating factor to get better. It can also help the business owner to come up with brilliant strategies to compete with the market. According to Nancy Pearcy “competition is always a good thing. It forces us to do our best. A monopoly renders people complacent and satisfied with mediocrity.” Competition can be good or bad, depending on your response to it.
What is Marketing Competition?
To understand what this word entails, let’s start by examining the word individually. We often use the word “market,” to describe a place where people buy and sell goods and services. In ancient times, market is restricted to physical settings where products and services were displayed for interested buyers. Today, technological innovation has paved the way for both offline and online.
Competition on the other hand means two or more people in a match to win over the other. A good example is the football game. In any competition, when one party wins, the other automatically loses. The winning party gets all the recognitions and advantages of emerging as a winner.
Put together, market competition is a situation where two or more businesses constantly devise tactics and strategies to outshine others in the market. Since the market is a place for buying and selling, the winning business remains on top of the list of customers, it gains more recognition and has the highest leads.
Types of Marketing Competition
There are three major types of market competitors, direct, indirect, and replacement competitors
- Direct Competitor
Direct competition occurs between companies that sell the same product and target the same segment of the market. An excellent example of companies that portray this kind of competition is Staple and Office Depot. Both companies not only sell the same thing but in fact operate in similar ways. It was not until Staple acquired Office Depot did the competition reduce.
As a business owner, direct competition is what first comes to mind when you think of the word “competition.” It is that company within or outside your vicinity selling the same solution you sell and targeting the same consumer or buyers like you.
- Indirect Competitors
Companies engaging in indirect competition do not necessarily sell the same thing nor use the same strategy. The only factor that necessitates competition is the audience. Indirect competition entails companies targeting the same audience. In most cases, the goal of an indirect competitor might not be the same as your company, their method of generating revenue also differs from yours. A good example is contractor companies and do-it-yourself companies.
- Replacement Competitors
This type of competition occurs among companies competing for the same section of the market. If, for instance, you run a restaurant business in a locality where there are bars and cinemas. No doubt, your target audience can choose to go to the bar or cinema instead of spending their money in your restaurant.
5 Benefits of Marketing Competition
- Increased productivity,
- Opportunity to learn new strategies,
- Opportunity to upgrade customer service,
- Create more business awareness,
- Enhance customer satisfaction.
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