A competitor analysis can help your brand stay ahead by identifying gaps in your opponent’s business efforts. Here, the team at Newsclip takes a look at how you can beat your competitors to the punch through the use of this intelligence.
Ever heard the saying ‘keep your friends close and your enemies closer’? This especially holds true when it comes to competitor analysis. The advantage of keeping close to your opponent is that you know where their strengths and weaknesses are, which allows you to better plan your strategy and anticipate their response.
Here’s an example: Who would have thought that Google and Uber would become competitors? No one could have anticipated this until Google launched its own ride-hailing and delivery service. So, how would each one of these businesses stay on top of one another? With a competitor analysis, of course!
Simply put, this is the evaluation of potential opportunities to act on and threats to be aware of as a brand.
Keeping tabs on your competitor can help you to keep track of changes to products or services similar to yours, pricing or marketing strategies. It can also help you discover new strategic areas to improve your own brand.
Ready to learn more? Then read on!
1. Identify the competition
Every business has competition — and yours is no different. If, for example, you own a bakery in the city, there are other businesses where your customers could spend their money. It could even be a brand offering a similar product to yours (like another snack or food that is tempting to buy), which might make yours the second choice.
With the internet making information more accessible than ever, you could also be competing with a company in a different country — not only with those around you. It can even be a new product or service in the making that you were also planning or in the process of selling as well.
It’s important to keep track of this information, which is why conducting an analysis with services such as Focal Points is so vital to your business’s success.
Before you start collecting information about your competitor, you need to ask yourself:
What products or services do they offer?
This is where you can determine whether your competitor’s products/services are directly the same as yours or whether it is indirect; this means that it's a different product but it could potentially satisfy the same needs.
Are they appealing to the same target markets?
Identify the group of people that your opponent wants to sell to; they are the same as your target audience.
Are they operating in the same areas?
Here, you check to see if your competitor is operating in the same geographic region or a different one. Location creates an outline for your immediate audience.
Also, if you are in a market with many competitors, you don’t have to monitor every single one of them; this is impractical. You can save your business money and time with the 80/20 rule by identifying competitors that are potentially the most productive, and by making them your priority.
2. Monitor how others approach business
Monitoring the way your competitors do business can help you refine your own business strategy. This includes comparing key components, such as service offerings, pricing and marketing strategies. Ask yourself what you can offer that your competitor cannot — or consider whether you offer products that are cheaper or highly reviewed.
You could do this by tracking your competitor’s pricing to see if yours matches with their same product. Or, you can even determine a price for your own new product by seeing whether what they’re offering should be of higher value, allowing you to correctly alter the pricing of your own offerings.
You also need to track your opponent’s social media networks; this is because businesses are increasingly using them to market their brands. Utilising social media tracking tools can help you to keep a pulse with most things your competitor does, as you can come across interesting facts or updates like events planned, customer service, what types of audiences they are targeting or customer feedback.
An example of this could be a consumer complaining on social media about your competition’s offerings. Having been notified of this, your brand can then swoop in and save the day by advising on how your own products/services can be a solution to their problem.
Another way to keep an eye on your competitors is by monitoring their websites. This allows you to gather information about the brand in detail, their plans and what they are hoping to achieve. You can also monitor your competitor with media monitoring to see where their brand is mentioned in the media; this allows you to stay in the loop as you’ll be able to see how people are talking about them, as well as any press releases regarding their business.
You can also sign up for your competitor’s newsletters through their company website to get more news and updates about any new product launches or developments.
3. Act on the information you've gathered
Competitor analysis is not a once-off study; it's something that needs to be done regularly. It’s important to evaluate the data collected after a specific period of time and determine any spaces that need to be filled.
You can do this by categorising your information in the following manner:
- What you can learn from your competitor and what you can do better: You need to make some changes in your business strategy if your competitor is doing better than you. You could do this by being more innovative in your strategy and by offering a service that adds value. Think about what makes your brand unique; not one that is copy and paste of every other competing business, because they could just be winging it.
- What they are doing worse: Take advantage of the weaknesses you've identified after conducting your analysis; this could be a customer service difference. If you have found that your competitor does not respond to customer complaints quickly, make a point of addressing their grievances in a more personalised approach and as quickly as possible.
- What are they doing the same as you: Thoroughly look at your competitor’s commonalities to see if you are on the right track and work on anything that might need improvement. This could be anything from the same product distribution or customer service. You could even improve your services by changing your supplier for a smooth delivery or marketing your product on different platforms.
Ever wonder why your competitors in advertising are always one step ahead? They probably use ad monitoring. Learn more in our blog, Three reasons why advertisers should monitor their competitors.