The Strategic Sweet Spot

There is no more critical time than now for small businesses to discover their “strategic sweet spot”. Business owners put a considerable amount of time into evaluating the market, selecting a niche, and developing a personal or company brand. These are essential to business success. But the work is not finished until careful analysis has been done to find what products and services your customers need or want that no one else is offering.

Market and competitive analysis is usually done as part of a business planning or strategic planning process. Business owners need to know who else is doing work or selling products similar to theirs. Sometimes the competition is obvious. In health care, it is easy to identify the number of hospitals in a given area. However, deeper analysis must be done to find the smaller clinics and private offices offering services that compete with those done in a hospital or medical center. In the automotive industry, there is also overlap between auto repair shops,“big box” stores, tire stores, and shops offering specialized services (i.e. transmission repair). Knowing your competition is vital as you select services, establish pricing, develop marketing plans, and later consider expansion. It is vital to develop a strong network to keep abreast of what is happening in your market. You can learn much by maintaining friendships within your industry, listening to new employees or potential recruits, and talking to vendors. All this information should be written down for comparative analysis to create a picture of what is happening in your market.

Knowing your customer is equally important. Customer surveys and frequent personal contact will give you opportunity to learn what customers think about your services. Ask your customers how well they like your work or product with the view of learning and improving, and they will share ideas you may have missed. Use caution in asking customers about your competition –you don’t want to remind them of the things they favored there –but you can ask your customer to help you grow and improve. The most important question to ask is, “What products or services do you need or want?” Ask your customer for a wish list or to imagine a perfect world. They might ask for something impossible, but that dream might just spark an idea for an innovative product or service that no one else is offering. You have now discovered a strategic sweet spot. You are in a position to offer something no one else is offering. You will make your current customers very happy, and they will tell their friends.

Think outside of the box when looking for a strategic sweet spot. Your competition and customers vary in different contexts. If you start by looking at a market location or certain demographic, then you might shift to looking at specific niches within your industry (i.e. technology used in your field, automated processes, customer service innovations). Your strategic sweet spot may be something you are already offering or might be a new product or service yet to be developed. Either way, a strategic sweet spot gives you a competitive edge that will strengthen and expand your bottom line.