Episode 348: Competitive Profile Matrix
In this episode, Fiona shares a framework called Competitive Profile Matrix. She also discusses how to assess your business against competitors using this matrix. Tune in!
Topics discussed in this episode:
Introduction
The importance of ongoing marketing efforts
Initial steps taken when creating a business
Analyzing where your business fits in the marketplace
The risk of complacency in marketing and messaging
Understanding the attributes important to your audience
Ranking attributes and competitors
Identifying areas for improvement and differentiation
Conclusion
Get in touch with My Daily Business
Resources and Recommendations mentioned in this episode:
You mark yourself and your business against all of these parameters with the ranking and let's say you are a 3.7. The competitors that you need to focus on are the ones that are 3.8 and 4 because they are above you in all of these things. However, you may decide that no one scored particularly high in the selection of dairy-free, gluten-free, vegan baked goods. That may be one of the key marketing messages that you use when you are opening up your bakery cafe or when you are rebranding or just readjusting your marketing message because you're going to be looking at the things where you excel and maybe the competitors around you don't.
Welcome to episode 348 of the My Daily Business podcast. Today is a coaching episode and if you have ever felt like you don't know how to stand out in your industry or you're not sure why somebody might choose your business or brand over another's. I've got a framework that can help you when it comes to that as well as looking at the different marketing messages that you're putting out there. Before we get stuck into that, I want to acknowledge the traditional owners and custodians of the land on which I record and that is the Wurrung and Wurundjeri people of the Kulin Nation. And I pay my respects to their elders, past, and present, and acknowledge that sovereignty has never been ceded. I also acknowledge that it is a very difficult and challenging time here in Australia at the moment especially with the referendum coming up in not long at all. For any First Nations listeners, please know I'm sending you a gigantic hug and I am just sending all my love your way.
The other thing I wanted to mention is that if you are in the mindset of creating a strategic marketing plan for 2024 and you want to learn from somebody who has been in marketing for 22 years now and understands how marketing can help and not just social media but other types of marketing as well, then you'll want to check out Marketing for Your Small Business course and coaching program and it kicks off next week on the 10th of October. If you're reading in real-time, you can buy the course anytime just at marketingforyoursmallbusiness.com. You can go through that at your own pace twice a year. We do run a coaching program in conjunction with that. It's nine weeks of live coaching with myself and you get feedback from me and from everyone else in the group as well. You can join up to that at marketingforyoursmallbusiness.com. Let's get into today's coaching episode.
When it comes to running your business, I feel like people do quite a bit of work at the start and what can happen is that you get complacent or maybe you feel like that's somehow done and dusted just PSA, it is not. But what can happen is that you maybe create a business plan or you just put some thoughts together or maybe you've even worked through my first book, Passion Purpose Profit. You've done reading, you've done research, you talk to people, maybe you've been in some groups and you analyse, where am I going to fit in the marketplace? Depends on what type of product or service you're creating and you might have gone down the whole road of MVP or if you're a startup maybe you had to get funding.
All sorts of things can happen at the start. What tends to happen, and I see it so often, is that people may be like three, five years in and they might've got a little stale in their marketing or complacent with their messaging or been like, I started here. That's where we've been kept going on all our marketing channels, even though the actual business has changed quite a lot. But we haven't changed our tone of voice, we haven't changed what we're talking about. We haven't looked at the benefits of what we are doing, not just the features. Today I thought I'd introduce you, maybe you already know about it to a framework that could be useful and is very quick I think for figuring this stuff out. I mean there are so many frameworks out there.
There are many that I use with clients all the time and many that I've referenced here. This is another one that I often use with clients. It depends on where they are, but particularly if they are transitioning or if they are maybe starting to see a dip in sales, starting to see potentially new competitors come into their market that hadn't been before. It can just be a great tool for doing this. What it is? It's called a Competitive Profile Matrix or Competitive Matrix, depending on who you're looking at. Basically, it's looking at the profile of your business or brand in comparison to others. There are lots of things I've talked about before about brand matrix and comparison, XY axis and looking at plotting yourself out and plotting other brands out. There are so many ways that you can do this.
You can just do a simple SWOT which is your strengths, weaknesses, opportunities and threats. But this Competitive Profile Matrix is quite important because it doesn't just look at your competitors and how you are comparing literally to them, but it also looks at like the markers of what makes for a good brand or business in a particular industry. Let me try and describe it because it is a visual thing. It's literally a table, right? You've got a table, you can use Excel Sheet or Google Sheets, or you can just draw it up old school. What you want to have first is to determine the attributes of your product or service that are attractive to your audience. Now you can do various tables, you don't have to just have one that somehow defines everything. But let's say for example that you are a bakery.
Let's say you are a bakery in, I was going to say where I live in North Warrandyte, I don't even know if there is a bakery in North Warrandyte, I don't think there is. I've been here for nine years, I should know that. But let's say you're a bakery brand for example. You might first think about what people want when they come into a bakery. Maybe it's like a bakery cafe thing. You might determine the things that people care about are things like firstly what pastries and bread do we offer? Do we have a wide selection? That might be selection for example. Then they might think, how accommodating are you to diversity in terms of like do you have gluten-free options, do you have dairy-free options, do you have vegan, do you have vegetarian?
That's like a secondary to the overall selection. Like do they have bread and pastries and cakes and pies or do they just sell bread? And then next to that is what selection they have for people who may have allergies or different side of food priorities, and preferences. You want to think about, what else is important to the people. Depending on where it is, if it's a cafe, they may also want beverages, like hot beverages. Tea, coffee, and hot chocolate. It's like, do you offer that? The next thing they might be interested in is the overall atmosphere. Like is it a cheap and cheerful place? Is it an Instagramable, beautifully designed, fit-out place?
What does the atmosphere feel like? We've all been to different places that sell the same thing. Like if you think about a high-end butcher versus a cheap butcher, if you think about some fancy like a health food shop versus a cheap and cheerful greengrocer, there are things and products and services out there that are pretty much the same or similar and yet it's the atmosphere that can make a real difference. You might go, it's the selection then it's the diversity of selection, then it and like accommodating to different food allergens and then it is the atmosphere. Then it might be things like the actual fit-out. Again, is it accommodating and it should be, but a lot of these places aren't to things like prams and wheelchairs. Does it have steps that you have to get in to get up into a bakery or cafe or is it a ramp or can people that are on walkers get in there?
The fit-out can be another thing that is potentially a differentiator between you and another brand in that suburb. Let's say for example with this whole example of a bakery and you might think of things like seating. Does it have an area to sit in? In Melbourne, where I live, we have incredibly amazing food and diverse food. My husband is a huge fan of Bahn mi Vietnamese roles. When I used to work in Collingwood, there was this place on Smith Street, I can't remember what Sunny's is called. There used to be a line, I mean there probably is a line still out there daily. I remember I used to work in this agency sometimes we'd walk up and everyone would get there bound me but you'd happily wait for ages but there was no seating in there from what I remember, maybe they've changed things a long time ago.
The seating isn't necessary maybe where they are because it's in a city, a lot of people are just grabbing it while they get to have their break from work and walking back to whatever agency or place they're working at. Whereas if you are in the suburbs, if somebody wants to go into a cafe or a bakery and maybe they want a seat as well to be able to sit down, have their coffee or tea and have whatever they're eating. Likewise, if you're going after say school, if you're near a school and you've got like parents coming in and they've got younger children in prams maybe they do want to sit down and have a bit of play space. The fit-out may include things for children to play with. It could include an outdoor space out the back.
You have to think about the fit-out is also a differentiator when it comes to this example of a bakery. We have a selection there, we have a selection for people with food allergies or food preferences, then we have an atmosphere, then we have fit-out, then we have seating. Another thing might be parking. I live in North Warrandyte and I go for my big walks most warnings and it is hilly as it's not always definitely for a lot of people in North Warrandyte they live a little bit too far to just pop to the shops or pop down to a cafe. Parking may well be a contributing factor if somebody's going to come to your bakery or cafe because it's easier to drive down there and park versus maybe another one that has no parking around it.
If you're living in the suburbs, that might be a problem, it might not be. But if you had a bakery smack bang in the city, maybe you wouldn't need parking because people are riding their bikes or catching public transport or maybe living closer and walkable distance on flatter surfaces for people to be able to walk like that. All of these things are you are determining that those things are important attributes to anyone seeking a bakery/cafe in a particular area. That's the first thing you want to think about when it comes to your industry. What are the determining attributes or features that people are looking for? In a service-based industry, it can also be things like level of experience, level of services available, niche, like it could be all sorts of things.
You can also do this in terms of marketing. Look at your competitors and think about which platforms they're on. You could put platforms specifically, you could also put content types, do they do video, text, audio, or all sorts of things. The first thing is to figure out what are the attributes that are important to our audience. Because that's the first thing. Once you have those, depending on how many you have, you're going to split them up and give them a ranking and you want all of them. If you had 20%, 30%, or 10%, you'd have 40% left that had to be divided by the other features. You have your selection, you have your selection as like a selection of pastries and stuff.
Then you have the allergens, then you have selections, then you have the allergens, then you have coffee and tea, then you have atmosphere fit out seating and parking, that is seven. Those seven things you would give a ranking to each. You might say, parking is not that important. I'm just going to put that as 5% because I don't think it's that important for this location of the bakery/cafes. Whereas you may think that the diversity in the selection of food, so if they've got gluten-free, dairy-free, nut-free, that is way more important for this particular industry that you're going into or for your ideal client as well. You might give that ranking 20%. You give all of them a ranking and total that equals a hundred percent or one. If it was 20% it would be 0.2. If it was 30%, 0.35%, 0.05.
You have your attributes in the first column, and then you have your ranking next to it. Let's say next to parking, you have parking and then in the next column, 0.05 because you're doing it 5%. Then you have your brands. You might decide there's bakery one, bakery two, bakery three, and then your bakery. With the 1, 2, and 3, you are marking them on how much out of five would I give them for parking. You might say they have a great car park right out the front and they've got disabled parking and all sorts of things parking with prams. I'm going to give them five out of five, somebody else may have zero parking and they're on like a busy street with like an intersection of traffic. You might give them one out of five.
What you're going to do then is multiply the ranking. In this case, we gave parking 0.05, so you put 0.05 times one or 0.05 times five and you're going to put that number in next to that brand. You continue to do that for all of those seven factors. What you'll end up with is, let's say brand A did you know pretty well. They have ended up with 3.8 out of five, brand B not as great, they've ended up with 2.6 out of five, brand C, they're amazing, they're four out of five. And then you have to assess yours. Sometimes it can be hard to do this without bias, without being like we are amazing at everything. You might want to look at surveys, you might want to look at data, you might get a focus group or you may if you're just working by yourself, maybe get an accountability buddy or another friend that's in business or even just a good friend, but somebody who's going to give you the honest truth as well.
You mark yourself, you mark your business against all of these parameters with the ranking and let's say you are a 3.7. The competitors that you need to focus on are the ones that are 3.8 and four because they are above you in all of these things. However, you may decide that no one scored particularly high in the selection of dairy-free, gluten-free, vegan baked goods. That may be one of the key marketing messages that you use when you are opening up your bakery cafe or when you are rebranding or just readjusting your marketing message because you're going to be looking at the things where you excel and maybe the competitors around you don't. I know I rushed through it a little bit and it's hard when it is a table or it's something visual to discuss it in an audio medium.
I hope that that makes sense. You have this table in the first column, you have the attributes that are important to your audience. In the second column, you are going to rank them so that in total all of them add up to one or to a hundred percent. Then you are going to put in brand A and think about how good are they at attribute one, attribute two, attribute three, attribute four, and attribute five, give them a marking out of five, then multiply those markings by the ranking, which is in column two, and you'll get a total figure for that business. Then you do the same for the second competitor, the third competitor. And then for yourself. It's about assessing where you sit and maybe there are attributes that your audience is looking for and you haven't even considered them.
For example, my son has a good friend who is gluten-free and as a parent who is having that child over sometimes or even just dropping them to basketball, I have noticed how hard, even though I would say that like a lot of people are gluten-free now, but it's still like it's not the easiest thing to get especially, and I get that you go to a bakery and it's the flour and there are all these other things, but like there's usually nothing to get him in a bakery. Often when you're running around with kids, you can just drop into the bakery quickly to get something. It's interesting to me that in this day and age, how many bakeries do we have in this suburb? Three, I think, I don't know, I should like to look at this, but I don't think any of them serve anything that's gluten-free.
I get that it is created in an environment where there is flour, but there is gluten-free flour, there is spelt flour, and there are other things that you can cook with coconut flour and almond flour. I think I'm not a specialist in this so I'm sure I'm making a mistake here, but it may be that they could be bringing that in from elsewhere. It's cooked in a different kitchen and it's put into some shelf or area that is tight. I don't know how gluten travels in the air from Flour and Wheat but I've noticed with this lovely child that I have to think forward like, I need to get some gluten-free snacks, I need to get this, I need to get that. I always feel bad when I'm like, the rest of the kids can have this, but you are going to have this.
That's like if there was a bakery or a cafe that was clear in like, we have gluten-free, dairy-free, nut-free. There may well be like, that's a great selling point for that business. It might be that working through this you realize, we should probably be a little bit more inclusive with the food that we are offering out there. And likewise, I mean I feel for cafes because of the amounts of different types of milk that they have to have now on offer, but I've still been to certain cafes, especially in the inner city of Melbourne where there can be super coffee snobs where they won't serve like anything but one type of milk or they won't serve skimmed milk or they won't have butter on their bagels or whatever. I get that that's for a certain type of audience, but maybe that wouldn't fly in other locations.
By doing this exercise, you can sometimes uncover things that maybe you haven't thought of or that you are already doing and you never talk about. That's where you're going to think about adjusting your marketing messages, adjusting your actual offers, and looking at what is going to put us at the top in terms of that branding exercise in comparison to these businesses. How can we get better? There are some things, in some cases, that you're not going to be able to just throw a parking lot in front of your bakery cafe or do something else hugely drastic. But what you can do is look at the other factors and be like, we can't change the parking situation, but what we could change is the seating situation. Maybe we could put a little bench seat in front of our shop so people can sit outside and enjoy something.
There are lots of different things that can come up as a result of doing this exercise. As I said, it's called a Competitive Profile Matrix and you'll be able to see an example of this in the show notes for this episode, which you can find at mydailybusiness.com/podcast/3 8. But if you go through that and you still don't quite understand it, feel free to send me a DM. I'm @mydailybusiness_. And if you want to go through this with somebody and figure it all out and look at your marketing messages, definitely book a one-on-one coaching session. We are booking people now for the end of this year, so feel free to get in touch. You can just find all the information at mydailybusiness.com/shop. We do work with people throughout Asia, Europe, in the us I had two calls this morning with two guys in the US so it is possible to work with us regardless of whether you're in Australia or on this side of the Globe or not.
The other thing you might be interested in is Marketing for Your Small Business. That's an online course that's available anytime at marketingforyoursmallbusiness.com. You can also join the nine-week live coaching program that kicks off on the 10th of October. We will offer that again in I think March or April next year. It's a good time to do it now I think because you get that sense of what you need to include in time for a new calendar year if you're in Australia, sometimes people prefer to do it in March as well because then they can get it all done for the new financial year that kicks off on the 1st of July. I hope that this gives you some ideas for figuring out your own marketing messages, your own points of difference, and how you might create a better product or service. Thank you so much for reading and if you found this useful, please take two seconds and leave a review. It just helps other small business owners find this. And who knows, maybe somebody out there needs to know about a Competitive Profile Matrix for their own business. Thanks for reading, I'll see you next time. Bye.
