Thriving In Smaller Markets
Before opening a coworking space, one of the first steps you should take is a competitor analysis. It can help you stay ahead of your competitors and ensure that your coworking space stands out in a crowded market. A recent study by CoworkingResources study found that the coworking market is growing at a steady rate. Some cities like London and New York see a new coworking space opening up every five or seven days! Because of the popularity of coworking spaces, it has become more essential than ever for coworking owners to understand the market before opening a space.
The goal of many coworking owners is to create a space that stands out from the other options available. However, the only way you can understand how your business compares is by looking at the surrounding coworking spaces and conducting a thorough competitive analysis.
The competitive analysis is an essential part of your business plan because it can help you hone in on what your customers want. Despite what you might believe, there is a way to research and learn from your competitors without being sneaky or blatantly stealing customers. While you might not have a big budget for conducting market research or hiring a professional market intelligence firm, you can still learn from your competitors by doing some simple research in a non-threatening way.
Your competitors will be anyone who targets the same market as you and offers a similar coworking or flex workspace in your immediate area. Start with a Google search. Look up “coworking spaces in [city]” and compile a list of every business you can find. And since “coworking” still a fairly new term in the mainstream market, try the words, “flexible office”, “shared office”, or any commony-used synonym for “coworking”. With some intelligent internet searches, you’ll quickly see who is ranking high for some keywords or phrases that are similar to your business goals.
Identify both the direct competition, which is someone who will offer the same products or services, and the secondary or indirect competition, or someone who will offer slightly different products or services.
The advent of the Digital Age as required new businesses to become experts in two essential disciplines: SEO and content strategy. These fields are paramount for a new business that needs to reach potential customers. Luckily the basics are easy enough for the average person to pick up without getting another college degree.
Once you have identified who your major competitors are, you need to learn as much information about them as possible. Ubersuggest is a free tool that you can use to research the most important keywords in the industry and to get a sense of your competitor’s marketing strategies. With this tool you can easily see which keywords and links are delivering the most online traffic for the coworking space in question.It can help you gain insight into your competitor's SEO practices and also see which domains you might be competing against for the top positions on Google. While some of the terms on the website may be hard to understand at first, the learning curve is low enough that anyone motivated enough to do some real research will learn quickly.
Visit the company’s website and keep notes on the data you find. What are their pricing levels? How do they market themselves to their members? Staying organized is vital here, especially if you have multiple competitors. Make a spreadsheet and fill it with links to each business’ blog posts, videos, webinars, podcasts, flyers or brochures, websites, feature articles, and any news releases. Press releases can be particularly useful because it will highlight any changes or improvements the business has made in recent years.
To create a useful competitive analysis, you need to read everything you possibly can about each business. While this might be time-consuming, it is a crucial step because it not only helps you to gain insight into the market, but also helps you think about how to differentiate your space, and puts you in the analytical mindset you need to have to sustain a business. As you read, keep track of the quality of the posts, and take the time to identify the style and tone that your competitors are using to speak to their members. Are their videos and other content effectively marketing the space? What do you think you could do better?
Many established coworking spaces have active social media pages because it is an effective way to build a community online. Take note of how often they post, and the tone they use when posting. Do they use Facebook, Instagram, Twitter, or LinkedIn to reach their target market? Following social media traffic, whether it be paid ads or individual posts and conversations between followers, is an easy and cost-effective way to gauge pain points and the general sentiment for each space.
Analyzing your competitor's social media pages also allows you to see how they interact with their members. On your spreadsheet, track how often they post and what types of things they post.
Read their Yelp or Google Review pages to find out what people like (and don’t like!) about other coworking spaces. On these reviews, you might find information that can help shape your business plan to what your potential members want and stay ahead of the competition.
Even if your competitors don’t have social media pages, they might be writing an online newsletter. Sign up for their mailing list so you can keep informed of any upcoming changes, new software the coworking space is introducing, or services they might begin to offer. However, this is not recommended for every coworking space. It might not be possible to sign up for their newsletter without becoming a member yourself or making it seem like you are snooping for leads. In those cases it’s better to just be direct and ask the owner for a tour or share their experience as an owner.
Now that you have compiled all the information, the work isn’t done yet. The business plan is not complete until you have analyzed what the data means. Absorb the information, and as you are reading each page, ask yourself how you can compete against that company.
Remember, what works for your competitors might not work for you. Be inspired by what your competitors are doing, but make sure you are creating a coworking space that is unique and stands out. For many small coworking spaces, a competitor analysis can identify a niche market that allows you to capture a specific demographic or community. This research can help you find an overlooked segment of the market that you can attract and fill the gaps that the community wants in a coworking space.
Once you open your doors, your analysis of your competitors and your coworking space shouldn’t stop. As you gain more members, ask them if they have used coworking spaces before and why they have decided to use your space instead. If you do lose a member, do the same and identify what you could have done better to keep their services with you. Continue to adjust your business to fit the market’s changing demands while staying true to your defining mission.
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