How to Conduct Competitor Analysis in the Coworking Industry
Competitor analysis is part of the daily struggle to stay one key step ahead of the competitors breathing down your neck. No matter how original your business idea might seem, chances are that you’ll have to look over the competitor’s fence sooner or later, as knowing what you come against means being halfway to victory. Make no mistake, this is a complex process, in which you actually build the unique character of your value proposition by acquiring intelligence about those who, essentially, want to outcompete you in the process! Thankfully, this can be broken down into several stages which we’ll explain in more detail here.
Market share is pretty self-explanatory and identifying what goes on with it starts from determining the number of competing coworking spaces in the area you want to provide your services in. In essence, you want to look at the level of success your competitors have achieved, as reflected by what they take in form of their market share. You can compare the figures from their business records (such as those on Crunchbase) with those relating to the industry average at the local or national level. Remember that having the largest market share does not mean that they offer what’s best for the customers – they may be, in fact, just a better established company and your opportunity lies in identifying their strengths for the purpose of turning the tables on them.
First of all, you’ll need to establish if your competitors are really profitable. This portion of competitor analysis entails determining their cost structure, main sources of profit, liquidity and methods of growth as well as resources in form of human capital and available facilities. Bear in mind that determining profitability also means establishing the degree to which your competitors rely on their competences and market positioning to achieve a financial edge.
USP (Unique Selling Point)
Doing your homework on competitor profiling will help you identify not just what makes your competitors tick, but develop your own Unique Selling Point (USP) with which you can attempt to take over their market share. In essence, this is the measure of what makes your product or service special and standing tall among what is offered by your competitors. Leaving them in the dust means being well informed about what they consider their USP and building upon this type of business intelligence for your own needs. Make sure you check any resources your competitors use in attracting audiences to their USP, in form of their website, blog, promotional material, newsletter and publications.
Types of customers
Examining your competitor’s customers goes hand in hand with all of the above efforts, since neither their market share not the USP could exist in the first place without access to the customer base they serve. Some profiling is in order here, too, and, in our day and age, this job is made easier by access to social media. Make sure you check your competitor’s social media pages, as the places in which their interaction with customers is most prominent. Check their list of followers on Facebook, Instagram or Twitter to get some idea about the demographic profile of their audiences. Do not forget to go through visitor posts, as well as any reviews you can find. All of these will help you identify any potential gaps in what is demanded by the customers and supplied by your competitors, and use it to create an offer that surpasses whatever your competitors may put on table.
Utilization rate of space
Utilization rate of space is a specific measure used to assess the quality of your competitors’ offer in the field of coworking. If, for example, the national growth rate of coworking spaces is X%, you can easily apply that to your city as an approximation and understand how many new spaces may open for business. This is helped by checking several parameters, which include looking at the highest number of people using said space during a day (daily peak utilization), rate of usage which changes throughout the course of a day (average peak utilization) or checking which businesses are proved to be the most active customers during observed periods.