As you craft your competitive intelligence strategy, you must prepare to confront all types of competition if you want to be effective. But to do that you’ll need to understand the three most common types of competition you will face as a law firm or legal recruiter. Let’s take a closer look.
A direct competitor is anyone who is offering the same type of service as you. For example, if you’re a law firm offering litigation services for the medical industry, a direct competitor would be another law firm offering the exact same service to the same industry. Direct competition poses an immediate threat to your business and must be watched closely. Using competitive intelligence tools such as Leopard Firmscape, you can watch for changes in a direct competitor’s business, track their hiring activity and even find out when they’re opening a new office. Keeping an eye on your direct competitors can give you a heads up about any activity that they’re engaged in that could harm your business. You should also use other Leopard Solutions tools to gather enough data about direct competitors so that you can prepare to compete effectively before they become an serious threat.
Competitors that indirectly impact your business are often the most overlooked and sometimes the most dangerous. An indirect competitor could be anyone offering a service similar to yours but that is different enough that it doesn’t seem to directly threaten your business. For example, let’s say you have a law firm offering litigation services to the medical industry, well, an indirect competitor could be any law firm that offers litigation services to the same industry but at a deeply discounted price. And that’s just one example. While this may not seem like a direct threat, especially if the service they provide is significantly inferior to your own, it could still pose a problem if customers in the medical industry don’t consider the legal services your competitor provides as inferior. That’s why monitoring customer perceptions and expectations is critical when dealing with indirect competitors. You might use competitive intelligence tools such as Law Firm Profiles or Leopard Hot Spot to monitor how the public perceives your indirect competitors and the services they provide.
As the legal industry evolves and changes, replacement competitors are popping up in unexpected places. A replacement competitor is anyone who provides a service that could replace you. For example, any technology, company or innovation that makes it easier to access up-to-date and accurate legal information without a law firm could be considered a replacement competitor. That’s why it’s critical that law firms and other legal industry professionals keep an eye on these types of threats. Subscribe to legal industry blogs and newsfeeds to stay abreast of the latest developments, especially in the areas of technological advances that might impact you. To be better prepared for replacement competitors, track legal industry news on Leopard Hot Spot and find out how other industry experts are responding to replacement competitors.
As you continue to develop and adjust your competitive intelligence strategies, make sure that you’re not ignoring any type of competition. Direct, indirect and replacement competitors all pose a unique threat to the legal industry.