How good is your competitor? Is there anything you can learn from them? If you are in business, then you know that it is inherently competitive, and one of the best ways to get maximum earnings is by staying ahead of your competitors. To understand your competitor's strengths and weaknesses, you need to analyze their products and marketing strategies. Competitive analysis will help you to make informed decisions about how to run your business.
How to run competitor analysis
Using a combination of data from competitive analysis tools and traditional market analysis methods, you can systematically analyze your competitors' big-picture metrics as well as a specific tactical approach to better understand how they achieve their results.
1. Identify your competitors
There are two types of competitors. Direct and indirect competitors. Map out companies that offer products and services in the same category as yours and categorize them into different levels using these factors:
Your direct and main competitors are identical to you in all areas, but indirect competitors have two or one identical aspects in the three areas. Your focus should be on the direct competitors.
There are different ways to identify your competitors:
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A quick Google search
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Insight from your sales team
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Feedback from your customers
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Using a competitor analysis tool
A competitor analysis tool is by far the most efficient method because by using different data points you are more likely to find closely related competitors.
2. Create a company overview
Once you've found your main competitors, create a company overview with the following:
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Basic information like the company size, location, employee found, and year of establishment.
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Financial and business information including stock values, owners, investors, acquisitions, and mergers.
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Define their market position and share, level of brand awareness, range of products, and delivery methods.
With an overview of your main competitors, you can evaluate how your company fits into your market in general.
3. Perform a SWOT analysis
Assess your competitor's Strengths, Weaknesses, Opportunities, and Threats. It will provide a concise framework for you to gauge your competitive landscape to make informed decisions. A SWOT analysis will help you discover where you are vulnerable and where your biggest opportunities lie.
4. Research your competitors' 4Ps
What are your competitors' Products, Prices, Places, and Promotions? Understanding these fundamental elements that businesses use to develop and implement marketing strategies will help you understand the best strategies for your business.
5. Understand your competitors' target audience
Their target audience is most likely your target audience as well. Understanding the audience demographics is crucial to your marketing including tone, pricing, and positioning. Using a competitor analysis tool, you can identify factors that impact a customer's state of mind, their knowledge, level of attention, and ability to process information.
6. Website competitor analysis
Understanding your competitors' website performance enables you to understand their marketing performance and how your business fits in the market based on data. This helps you make informed decisions on marketing strategies.
7. Analyze your competitors' keyword and content strategy
How are your competitors showing up in search results? This could reveal their SEO strategies and help you enhance yours so that your website can perform better.
8. Analyze their lead generation strategies
Put yourself in the shoes of their audience and travel down their sales funnel. This will help you understand:
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The major pain points they address
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The unique solutions they offer (and how)
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Their key messages for customers
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Who is sending referrals to their site
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How they serve their customers (site or app)
These eight steps can be done using AI solutions to give you comprehensive and competitive data to help you find untapped opportunities in your market. With this information, you can create a strategy that capitalizes on your strengths and addresses your competitors' shortcomings.