Competitor analysis is one of the key factors that help businesses to become successful in their industry. Every expert out there recommends that if you want to outperform your competitor, then first you need to understand your competitor and their business functioning.
No matter how effective and impactful your products are for consumers, if you are failing to keep an eye on your potential competitors then you might be losing important intelligence and strategies that could help you to grow your brand and businesses.
Now you might be thinking, how you can analyze competition especially if you are a new beginner then it’s very obvious to have these types of questions. Don’t worry we have got you covered below we have listed step by step competitor analysis process.
Monitoring your potential competitors closely and consistently help you to analyze their behavior and enables you to anticipate their future actions as well. Once you start discovering what your competitors are doing to attract customers and how their product & services are persuading users to take action? Then it will help you enhance your strategy and business functioning as well.
In this article, we are going to walk you through some points and tips that can help you to identify your potential competitor and enhance your competitor analysis process.
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What is competitor analysis?
Competitor analysis is the process that allows you to analyze your potential competitor’s business, strategies, website, products, and their customer’s pain point. It allows you to evaluate the strength and weakness. Using the information and data you get from your competitor you can make changes and options for your website, products, and services.
Competitor analysis can be effective and useful only when you:
- Select the right competitor for your business because your business development is also dependent on your competitor strategy and performance
- Identify which aspect of your competitor can offer you right and data for your business growth.
- Select the best tools for competitor analysis
- Understand how you can use the data to grow your business
Why do you need to do perform Competitor Analysis?
If you are planning to create an effective and result-driven strategy for your business within a short time then competitor analysis is the best option available. The success of your business is also dependent on the way you understand your competitor’s business function and strategies.
Competitor analysis is one of the crucial steps that enables you to identify and understand industry trends quickly. It also allows you to get an insight into your competitor’s strategy using which you can enhance your business strategy and product for better results.
If done properly competitor analysis can help you in getting quantitative and qualitative data that you can use to enhance your business offering. It enables you to determine and understand your competitor’s approach toward business.
If you still wonder why you need to perform competitor analysis then check the below points:
- Help you to understand the market condition
- Allows you to build a unique value proposition
- Using competitors data you can optimize your product so that it relates to customer and encourage them to buy your product
- Competitor analysis offers you an insight into the strength and weakness of your competitors business
- Allow you to build an effective and revenue-generating GTM (Go-to-Market) strategy
- Get insight into marketing segment that are not used by your competitor
- Helps you to identify gaps between your competitor and customer
Why businesses should not duplicate competitor strategy?
Competitor analysis has always been an effective and fruitful process. But, it can’t be used to make business decisions or copy the strategy and functioning of competitors’ business. Duplicating your competitor’s strategy may not offer you impactful results, instead, you can make use of the data to optimize your business functioning.
Businesses carry out competitor analysis just because they get access to a huge amount of data with a short period of time. Duplication your competitor marketing strategy can cost you more and give you less. For example, if your competitor is spending more on Facebook ads then it doesn’t mean that they are getting impactful results.
Make use of competitor analysis to find where they are lacking but never use it to make decisions for your company. Instead, try to make a unique one for your products and business. Because if your strategy is coming from a competitor then it will become difficult for you to outperform them.
We recommend not to spend a lot of time analyzing your competitor’s activity. Focus more on the problem faced by your customer as well as your competitor’s customer. Geeting insight about the gap between customer and competitor bsu7iness can help you to eminence your product and services.
Remember the main goal behind competitor analysis to understand and analyze their business function, strategies, and offers so that you can produce more effective results quickly.
How to Conduct a Competitor analysis for your business?
1. Identify your competitors
The first and foremost step is to identify potential competitors for your business. Google is the best platform to search for your competitor just you have to enter the seed keyword or other terms related to your nice.
To make this process more effective your competitors in two categories: direct and indirect
Direct competitors can be the business that operates in the same area and offers a similar product and services as of yours. On the other hand, an indirect competitor can be the business that doesn’t offer the same product but fulfill the need or solves the problem of the same group of customers.
Most of the business commits a mistake by focusing only on the direct competitor but your indirect customer can also offer you some important data that can help you to enhance your business.
Many businesses out there don’t offer the same product but in some way, they have the same niche. For example, if a business focused on selling bridal collection, another business selling everyday stylish outfit and another business offering workout centric cloth lands in the same industry but offer different products.
Including indirect competitors in your competitor analysis can separate your business from other businesses (in the same industry) that are running behind a direct competitor. Check your competitor’s activity frequently to stay ahead in the market.
After identifying your potential competitors next you can focus on getting an overview of your competitor’s business.
2. Analyze your competitor’s website
Once you have got an overview of your competitor next you can analyze your competitor’s website that’s the place where you can find a lot of your data including product details, customer review, design, website speed, and more.
So you begin by answering the below questions:
- How attractive and persuading your competitor’s website design is for customers?
- Are they using any pop-ups to advertise their services or to collect their visitor’s email list?
- How clear, effective, and attractive product images are displayed?\
- Where they have displayed their social media icons?
- How they ahve categorized their products?
- Where they have placed the call to action button?
- Are those CTAs clear, properly placed, and make sure to check competitor CTA appearance?
- Do they offer a blog page? Check their blog posting frequency and the information they offer in the blog
- How long does it take to get a response for your competitor from email, live chat, and more?
- What other features and services are offered by your competitors?
3. Determine what type of products competitors are offering
The primary aspect of any business is its product and service. Apart from your website design and marketing strategy one thing that will separate your business from other businesses. So, when it comes to competitor analysis you can start by analyzing products and services offered by your competitor.
You can analyze your competitor’s product line and the quality of the product and services offered by them. And make sure you check multiple competitors pricing because the pricing displayed on the website will also play a major role in making your business successful:
While analyzing your competitor’s product make sure you find the answer for the below-mentioned question
- How well they are showcasing their products?
- What their market share?
- Are they focusing on bulk sale or one-o purchase
- What is the price for their product and services low or high?
- Identify the characteristics and needs of their potential customers?
- How your competitor is differentiating its product and service of its competitors?
- What is the shipping charge they are asking form users?
- What distribution channel they are using for their business?
4. Identify your competitor’s customer and revenue
Create a separate spreadsheet where you can store the information about your competitor’s customers and revenue. To get an insight into your competitor’s revenue and customers you can make use of tools like Owler but it contains data of only a few companies. If your competitor business is not listed in owler then you can perform a google search with the name of companies and add words like revenue, customer, etc.
You can also keep a track of their press release and interviews where they share details related to their companies. Yes, you have to wait for their press release and interviews but for the long run keeping a track on these activities can offer effective results. To identify your competitor revenue you can make use of the revenue estimate calculator using the number of employees in the company.
5. Identify how your competitors are marketing the product and services
Competitor analysis also helps you to analyze how your competitors are marketing their product to its potential customers. Next after identifying competitor’s customers, you can start analyzing their marketing strategy to get a better understanding of market demands and expectations.
Below we are listing some question that will help you to understand and identify with whom you competitors are speaking and how they are placing themselves to grab more customers.
- Why customers are making a purchase from your competitors? (Because of the price, service or experience in the industry)
- How your competitors are separating their product from its competition?
- What type of feature they are highlighting in most of their marketing copy to attract customers?
- Identify what separates them and make their product and services unique?
6. Analyze your competitor’s sales tactics and results
One of the key aspects of competitor analysis is to identify and analyze your competitor’s sales tactics. This piece of information will help you to get an idea of how competitive your sales process is going to be and the data required to make a successful sales strategy for your business.
You can find the annual report of Businesses that are publicly publishing their report or publicly held companies. But if your competitor is a privately owned business then you need to do something sleuthing to get an insight into your competitor sales and report.
To identify your competitor sales tactics you can seek for answers like:
- What does the sales process of your competitors look like
- Channels used by them while seeling a product
- Whether they are operating from a single location or multiple locations
- If they are operating from multiple locations then it is increasing their sales or not
- Are they having a partner selling program?
- Are they scaling down (expanding)?
- How much they are making each year (annual revenue)?
- Do they offer discounts or coupons yearly?
- Involvement of a salesperson in this process
7. Review their Social Media Platforms
With the increase in social media active users, most of the brands and businesses have started to communicate with their potential customer on social media. Not only that but customers have also started to highlight their problem on social media platforms in the comments section.
So when it comes to analyzing competitors business make sure you check their business page on various social media platforms. Keeping an eye on your competitor’s social media platform can offer you multiple benefits.
If your competitors have a good amount of followers and users are engaging with their post then it indicates that you have a great opportunity to build a successful brand. And you can also get an idea about what type of users are engaging with them.
You can also identify what type of content your competitor share and how frequently they publish a post. Depending on the data you can create an effective social media marketing strategy for your business.
Go through all the social media channels and identify:
- Which social media platforms are mostly used by your competitors?
- Analyze their overall social media presence
- Identify what type of questions is being asked by users
- What is your competitor’s response time to the user’s queries?
- How frequently they post new content in their
- What type of content do they share on social media?
- How often your competitor interact with their followers?
- Which social media platform they are not using?
- Which type of post they are using to increase engagement and follower?
- How frequently they create posts related to their business?
Check Reviews for your competitor business
When it comes to finding the gap between the competitor and their customer then nothing can be more helpful than reviews. Identifying reviews written by customer can surely help you to discover problems faced by them.
Take the time and go through all the platforms where customers write feedback about the services, product, and buying experience. Finding reviews about your competitor can help you in building a strategy that can offer a solution to those problems.
You can go through their social media comments, google reviews, blog comments, and more to find the review give by real users. Once you successfully identify the strength and weakness then you tell your competitors customers how your business solves their problem.
Not only that but if you are finding positive reviews about products that are similar to your products then it indicated you have selected the right niche and people are interested in purchasing your product.
Competitor analysis is an important aspect of any marketing strategy. It offers you an insight into your competitor’s business functioning and their strategies and product offered by them. But remember by performing competitor analysis we are not asking to steal your competitor data. Instead, you can analyze it to offer and create an attractive strategy for your business.
Competitor analysis helps you in getting valuable insights into the industry, market, and customer within a short period of time. Above we have listed all the important tips and techniques that you can use to analyze your competitor’s business.
Identifying the gap between your competitors and their customer can help you to offer services that can fulfill the gap and help you to attract their customers. You can make use of tools to make your competitor analysis process more effective and impactful.