Competitor analysis and usage of competitive intelligence is an area of analytical study which is specialized in collecting and evaluating knowledge on competing businesses. It is an effective strategy to see what your rivals are doing and what threat they pose to your economic well-being. Competitor analysis is an evaluation of all the current and potential competitor’s strengths and weaknesses to identify the organization’s opportunities and threats.
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Competitor Analysis in Marketing
All the business organizations will be benefited through a competitor analysis. Because the organization would be able to find out the following:
- Determine the lacking of the business organization
- Improving the commodities and services or produce the idea of new goods and services.
- Discover developments in the industry.
- More effectively goods and services can be sold through identifying the opportunities.
Studying the above four aspects will guide the business organization along the way. But we need to recognize another few critical fundamentals before getting excited to get it all started.
You will have to figure out what measures you will compare throughout the deck, but for that, you have to first pinpoint the real competition of your business organization. The following are the aspects to properly classify the real contest:
Determination of Competitors
We need to probe into the following questions to scrutinize the goods and services the competitors offer.
- Is your competitor targeting high-end buyers or low-end buyers?
- Are they opting for bundle buy or one product purchase only or both opportunities are there?
- What is the market share of your competitors?
- What is the demographic character of the buyers of the competitor’s market? And what are their needs?
- Do they have different pricing strategies?
- How is your company any different from the rest of the competitor’s market?
- What is the distribution channel of the competitor’s market?
The answers to these questions will help the company to identify and compare and contrast the products and services with their own.
Who is the Competitor?
You have to first categorize the business competition according to-
- Primary Competitor
- Secondary Competitor
- Tertiary Competitor
Categorizing the competition into different boxes helps you to identify the other business organization’s association with your business organization.
‘They are the direct competition of your company because they sell your target audience, similar goods or service. These are the companies with which your target customers are comparing your product and services. For example, Mirinda and Fanta are each other’s primary competition.
They have different target audience but their product or services are similar to each other. The target audience may vary from different social and economic status to other different indicators. For example Kat Von D makeup brand versus drug store makeup brands.
Tertiary rivals are companies affiliated with each other through selling products and services to the same demographic but do not offer or deal with the same goods. But should they choose to grow their business, they may also be potential candidates or future rivals. For example, Adidas and Body Armour both sell to the same demographic of the sports market but the products are completely different from each other. One sells sports shoes and another sells sports drinks.
The next step to conduct a SWOT assessment is to know your strengths weaknesses, opportunities, and threats, and here it goes:
1. Track sales techniques and performance of your rivals. To do so, the following questions need to be probed-
a) How does the competitor’s selling practice appear to be like?
b) Does the competitor’s sales process have numerous areas to cover? Do they have an upper hand on the sales process?
c) Are the rivals going through business expansion or contraction?
d) Why they lost certain buyers and why they have certain loyal buyers? This gap can give insights for opportunities and threats.
e) What are the annual revenue and total sales?
f) Are there regular offers and discounts?
g) What is the contribution of the salesperson?
2. Examine the marketing strategies of your rivals. Analyze the competitor’s level of dedication from studying the available content. And meticulously note the product roadmap of your competitor.
To do so their blogs, whitepapers, e-books, webinars, podcasts, infographics, FAQs, featured articles, press releases, media kit and advertisements have to be explored.
3. Look into how the brand materials are marketed.
4. Since social media is the new area that has the highest level of reach from all classes, therefore, it is very important to also assess the competitor’s social media presence, roles, tactics, and channel. To do so the following sectors need to be assessed-
a) The social media post remarks need to be assessed if they have more negative, positive or a blend of both.
b) Who are the targeted audience and individuals who are reading and tweeting about particular content than others?
c) Remember to note if your competitor social media activities have hashtags or not and if they have “follow”, “comment” and “share” buttons. This will show how much they engage the audience.
Take all the data you assembled about every contender and recognize specific regions that need improvement. In the wake of taking a look at your rivals, you cannot deny the fact that you did not discover anything that would help your organization to measure the room for improvement and telltale signs of potential risks.
Read more All You Need To Know About SWOT Analysis
Importance of Competitor Analysis
Not exclusively will you have the option to distinguish key territories that you can enhance concerning your sales techniques, performance, marketing strategies, content creation, search engine improvement, and social media involvement; yet you can likewise help set up your organization’s quality with potential buyers like the window shoppers, and interested followers on social media. These strengths have to be further reinstated while untapped opportunities need to be explored.