How to find a vacancy in competition

This article starts from how enterprises can find a growing value point in a highly competitive environment, and provides suggestions for enterprises to find a competitive niche. If you need it, you can take a look.

1. Vacancy Strategy

In a highly competitive environment, how to find a point of value that can be grown is the key for enterprises to participate in market competition. And the valuable and sustainable growth point is what we call: vacancy.

Finding a competitive niche is a strategic decision for business owners.

In fact, a few correct decisions bring long-term compound interest to the company (decision compound interest), and the rest of the time is just used to digest the long tail of wrong decisions: the so-called direct succession. As the Sun Tzu's Art of War said: Knowing the place and the day of the battle, you can fight a thousand miles away - and the core of a thousand miles away battle is to know where to compete.

To answer this question, we must first distinguish between two kinds of "knowledge", one is the physical market of the product (i.e., shelf competition), and the other is the consumer's cognition (i.e., mental competition). From the perspective of the product, the shelves are always crowded; from the perspective of the mental market, you will find unoccupied blank cognition.

It is said that the weather is not as good as the terrain. Therefore, there is the saying that when two people meet in a narrow road, the brave will win. Victory does not depend on bravery, but on meeting in a narrow road. The geographical advantage of a narrow road is greater than bravery. This is also what Sun Tzu said in the Art of War: A good warrior seeks it from the situation and does not blame others - because the situation is greater than people, so choose people according to the situation.

In fact, the land has always been there. How to find the land (vacant space) and occupy it can form momentum. There must be advantages if there is momentum, and only by taking advantage of the momentum can we take advantage. The advantage of the location brings momentum. Gold meets silver, this is the advantage brought by the tangible land in commercial competition. There is also an intangible momentum, which is the momentum brought by consumers' cognition.

Consumers’ cognition influences their behavior and purchases. Only by having a cognitive advantage can you win the choice of the shelf. This is the so-called power of the heart. For this reason, we say:

• Vacancies + Growth = Positioning Growth Strategy
• Vacancy + Product = Super Product Strategy
• Product + Growth = Product Structure Strategy

That is: the core of market competition is to first find the competitive gap, and then create a super product that occupies the gap, that is, a hot product. The core of a hot product is to serve the competitive gap and is a tool to occupy the competitive gap. A hot product separated from the gap has no strategic significance. Don't use tactical diligence to cover up strategic laziness.

So, how to find strategic gaps? The essence of work is the method of work; the essence of thinking is the thinking mode, and structure determines the results to a large extent.

First: Vacancy Research

Without research, there is no right to speak. The essence of research is not to research the physical market or the shelf market. It is to research the minds of consumers, competitors, and inventory the cognitive assets of the enterprise.

So what is different about vacancy research, or what aspects do we need to pay attention to?

1. Different purposes: Vacancy research is to look for mental opportunities, that is, to find vacancies.
2. Different objects: The research is divided into five dimensions, including enterprise cognitive asset inventory, consumer mind interviews, competitor research (competitor positioning), etc.
3. Different approaches: Vacancy research is based on data, targeted at the mind, and aims to find competitive vacancies.
4. Different perspectives: Vacancy research is mainly based on external perspectives, emphasizing the user's mental response.
5. Different questions: Vacancy surveys use open-ended questions, which require relatively high standards from the researcher, especially the implicit knowledge of business understanding.

Four dimensions of vacancy research:

1. Business status: including the company's development history, product features, market share, receivables scale, and channel performance. The business status survey should restore the actual business operations of the company and repeatedly understand the core spirit of the company's mission, vision, and values.
2. Customer status: includes five dimensions: category affiliation, feature orientation, purchase reason, demand expression, and average customer. Customers here include potential consumers and users. In a broad sense, consumer roles are divided into: information collector, decision maker, buyer, user, experiencer, and evaluator. Customer status research should fully understand, explore, and discover consumers' understanding of products and subtext in different consumer roles.
3. Competitive analysis: includes reasons for selection, strongest alternatives, pros and cons analysis, customer characteristics, and market performance. The market performance here is not just the visible market performance, but also includes the position of competitors in the minds of consumers.
4. Enterprises think: the biggest opportunity, the biggest challenge, the team's strengths, the operational load, and the differentiated selling points. The biggest opportunity is to find the empty space, and the differentiated selling point is to carry the empty space and occupy the empty space. Then, consumers will fall into the product experience to verify the brand.

Through the comprehensive understanding of 20 points in four dimensions, a vacancy map is made. Through the vacancy map, possible vacancies in corporate competition can be found.

Through the vacancy survey, we can identify the trend of category differentiation and find the possibility of vacancy around the mind. In this way, we can find a valuable and long-term position for what the brand is, how it is different, and why it is so successful.

Connecting to brand strategy, it leads to the 4Ps of marketing (product, price, channel, promotion). It should be noted that brand and product are one thing, brand is the form, product is the content. Whether the brand form is strong or not, whether it is real or not, and whether it can occupy the vacancy depends on the content of the product. The content of the product is essentially to serve the vacancy. The so-called product content is the product packaging, selling point extraction, product story, and sales talk built around the vacancy. In a broad sense, it also includes consumer process design.

2. Project Case: Miao Xiaoxia's New Generation of Clean Zero Complementary Food

Next, we will take the Miao Xiaoxia brand we serve as an example to explain in detail how to implement the vacancy strategy.

Miao Xiaoxia is a brand of baby food supplements, whose parent company is Haipaike. The baby food supplements market has grown from the initial stage of competition to the growth of the category along with Ingredients’ large-scale advertising campaign on Focus Media.

According to incomplete statistics, there are no less than 500 brand companies in this industry. Yingshi is divided into different levels, Baby is greedy for exclusive nutrition, Qiutian is a nutritious full meal, Xiaolulanlan is an Internet baby food professional brand, and Dr. Cheese focuses on cheese. In the crowded track, how Miao Xiaoxia can find its own valuable and long-term strategic position is the key to the delivery of this project.

1. The industry market is large enough

China's infant and child complementary foods show a development trend of accelerated popularization, integration and upgrading, professional segmentation, and the rise of national trends. It is estimated that by 2025, the market size of infant and child complementary foods will reach 163.2 billion yuan, with an annual compound growth rate of about 10.7%), of which the market size of children's snacks is expected to reach 91.6 billion yuan, and the market size of infant and young children's complementary foods will reach 71.6 billion yuan.

2. Competition intensifies and concentration decreases year by year

At its peak in 2016, CR5 was 67.59, and in 2021, CR5 dropped to 58.67. In the first half of 2023, the concentration of baby food and baby snacks dropped again. Among them, baby snacks fell by 16.26% year-on-year in the first half of 2023, and CR3 dropped from 56.77% at the beginning of the year to 40.15%. The industry market concentration shows from one side that the industry has entered the stage of category branding competition. The industry reshuffle first reshuffled white-label brands, and then reshuffled brands without clear strategic positions. For companies that can survive in the next five years, their brands must find a vacancy of their own and establish their own brand position high ground.

3. Offline maternal and child stores show obvious differentiation trend

During this process, we visited 100 maternal and infant stores in Hangzhou, Qingdao, Jiangsu, Wuxi, Taizhou, Nanjing and other places in two months. During the visit, you can feel the real objects and see the great impact of the past three years on offline maternal and infant stores. (Here we would like to thank Miao Xiaoxia Qian, Xinyang, Xiaodu and our Zhengmi Triangle for visiting many stores together and practicing what we preach)

The significance of on-site store visits lies not only in the stores themselves, but in the process of communicating with 100 store owners from different regions and sizes to find the commonalities in consumers' demand for product categories and then answer where the vacant space for the Miao Xiaoxia brand is.

During the field research phase, a special reminder: When it comes to the design of questions, how you ask questions will determine how you get answers. Of course, it’s not just about asking questions, but also about the real consumers in these 100 stores. Understanding consumers is not limited to asking and listening. Instead, it’s about observing consumers’ consumption behaviors, understanding the needs behind their consumption actions, and understanding the pain points behind their actions.

In the process of visiting 100 stores, you will find that the mothers’ answers to questions are different, some are true and some are false, some are real and some are fake. At this time, the consumer is acting as a qualified consumer, or an ideal consumer, or a good mother.

However, when mothers walked towards the baby food shelf, their actions returned to reality.

• Pick up the product
• Look at the ingredients list first

Words can conceal, only actions are real. Behind the real actions are the core criteria for mothers to choose products. Look at the ingredient list. In fact, this action is not difficult to find, but the difficult part is to magnify the action to the brand side to understand consumers - to understand and perceive, consumers are eternal thoughts and topics.

Not only in offline stores, we also conducted questionnaires for nearly 500 mothers online, as well as one-on-one telephone and WeChat consumer interviews.

4. Competitive Analysis

The three core elements of competitive analysis: category, differentiation, and characteristics.

Category is the basis:

Thinking from the perspective of categories is the first step in doing business. Categories are the matrix, the market, and the foundation of business. Only a rich matrix of categories can breed strong brand vitality. So, what is the category behind the product? It is said that it is good to lean on a big tree for shade, and it is said that pigs standing on the wind will fly. Big trees and wind outlets are actually the bonuses that come with categories.

Differentiation vacancy :

Business is constantly differentiating, and differentiation brings opportunities - opportunities to create new categories. Those who are one step ahead are martyrs, and those who are half a step ahead are role models. How to judge whether you have taken a step or half a step is actually a reflection on differentiation and new categories.

• Discovering and selecting category opportunities is an entrepreneur’s primary business decision.
• Category differentiation brings new market space, and differentiation is the driving force of business development.
• Starting a war in a highly competitive price range is obviously unwise and requires more resources.
• New media produces new content, new content brings in new crowds, and new crowds trigger new brand opportunities.

Features to focus on:

Creating and leading a new category is the first choice of brand strategy or the best practice of brand strategy, because it finds a vacant position. Therefore, the degree of focus at this level can be understood as focusing on a clear, specific, and concrete category in the minds of consumers. Of course, it is necessary to distinguish between true categories and false categories; concrete categories and abstract categories. The core of the degree of strength is to form a clear cognition among consumers - occupying a vacant position.

Therefore, the degree of focus is strength (product strength) and clarity (consumers). Strength refers to whether the company can release the energy of focus by multiplication after subtraction, and the other is to release the clarity of cognition on the consumer side. The clearer the clarity, the more powerful the vacancy will be.

5. Consumer mind space map

Draw a vacancy map from the perspective of consumer minds:

• Positioning, communication, leader
• The second tier: with positioning and communication
• No positioning, but sales, global white label
• No positioning, sales, no communication, regional miscellaneous brands

6. Premium is supported

Based on consumer purchase data, evaluation, average order value, and product selling points, we can gain insight into the core purchase premium points and verify the premium perception of the vacancies.

Summarize

Cleanliness seems to be a basic requirement for infant and child food supplements, and many companies seem to attach great importance to cleanliness. However, there are not many companies that can maintain cleanliness for a long time and continuously.

Otherwise, there wouldn't be so many regional miscellaneous brands and global white brands - common sense is like air, people use it every day without knowing it. Miao Xiaoxia upgraded "clean" from an effective tactic to a strategy, occupying the clean space.

Strategy often exists in the front-line market outside the organization in the form of effective tactics. This is also what we heard the bosses describe more about Miao Xiaoxia when we visited 100 stores: their ingredients are clean and babies love them. We need to find it in the front line, pick it out, amplify, optimize, upgrade, realize system matching, and then make it an organizational strategy.

• Conduct vacancy research to identify Miao Xiaoxia’s competitors and vacancy possibilities.
• Avoid strong competitors and identify the brand’s advantages and gaps: clean.
• For the strategic vacancy, cleanly seek a reliable proof (ie: operational qualification).

Author: Houshan Keju, Source: WeChat public account “Lao Gao Business and Brand”.