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Competitors are companies that sell similar services or products to some or all of your customers and potential customers for example Coca-Cola and Pepsi, getting your daily news feed from your tablet device with the use of internet or a regular newspaper or McDonalds and Innocent smoothies.
You need to know who your competitors are in order to figure out ways in which your can differentiate what you offer to your customers and make your branding stand out.
It is going that extra mile to be different and more of what the consumer wants that will help you to be remembered by your customers over your competitors.
You should keep up to date on what your competition are doing in order to anticipate what their future plans are and prepare your business to ensure you can earn and win over customers:
Finally, your competitors help to keep the quality and standard of your service/product high, which encourages your customers to stay loyal to you.
If your competition works hard at trying to make their business better than yours then you in turn will also do this and continue innovating and improving in order to provide consumers with a very desirable solution in the form of a product/service.