In the business world, knowledge is power–knowledge about your market and knowledge about your competitors. But how do you gather this knowledge? By incorporating competitor analysis into your market research.
In this article, we’ll discuss how to uncover what your competitors are doing to market their companies, the benefits of understanding this information, and how to use it strategically for your own business. Think of it like piecing together a puzzle to get the full picture of the competitive landscape. By tapping into this wealth of information, you can better market your business in a way that truly stands out.
What Is Competitive Market Research?
Competitive market research is the process of gathering, analyzing, and interpreting information about your company’s market, specifically focusing on competitors. With this research, your goal is to understand your competitors’ strengths and weaknesses, as well as their products, services, and strategies. Essentially, it’s about gaining a clear and comprehensive view of where you stand in the market compared to others.
What Is Competitive Analysis In Marketing?
Competitive analysis in marketing is researching where and how your competitors are advertising and marketing their products or services. You want to uncover what platforms they’re active on, the types of content they’re producing, and which strategies and tactics seem to be garnering the most success.
By scrutinizing these elements, you can better position your business, find untapped opportunities, and craft marketing strategies that effectively resonate with your target audience, while also distinguishing your company from the competition.
Why Competitor Analysis Matters
We’ve already touched on a few reasons why performing competitor analysis matters, but let’s take a closer look at the benefits of incorporating this research into your business strategy.
Informed Decision Making
Understanding the strategies, strengths, and weaknesses of your competition allows you to make better-informed decisions, even allowing you to avoid mistakes others have made and leveraging opportunities they may have missed.
Gaining insights into competitors’ operations, products, or services can help you find your unique value proposition and differentiate yourself more effectively in the marketplace.
Predict Market Shifts
By closely monitoring competitors, it can help you anticipate industry trends and shifts, enabling your business to pivot or adapt.
Optimize Product Offerings
Recognizing gaps in your competitors’ offerings or identifying areas where they excel can guide you in refining your own product line or services, ensuring you meet or exceed market standards.
Effective Resource Allocation
Knowing where competitors are investing their time and money can help your business prioritize its own investments, whether it’s in marketing campaigns or customer service enhancements.
Enhance Marketing Strategy
Understanding the marketing channels and messaging that competitors are using can inform your company’s own marketing strategies, allowing for sharper, more impactful campaigns.
Recognizing threats in the marketplace early on, whether they come from established competitors or new competitors, enables you to strategize and mitigate potential risks.
Overall, competitor analysis provides a clearer landscape of the market, helping you to shape your business’ path forward with a deep understanding of the competitive environment.
What Should Your Competitor Analysis Include?
There are a few different elements that you want to take into account when performing a competitor analysis, including:
What are they selling? Here, you identify the core product or service that your competitors offer. This forms the foundation for understanding the essence of their business.
Features: Detail the attributes and characteristics of their product or service. This could include technical specifications, additional services, support, or any unique functionalities.
Appeal and Weak Points: Determine what customers love about the product or service. Look at product advantages, unique selling points, and customer satisfaction areas. Conversely, find out the weak points by checking areas where customers express dissatisfaction.
Pro tip: Customer reviews on platforms like Amazon, Yelp, or even on the company’s own website can be a goldmine of information.
Pricing Model: Is their pricing structure based on a one-time purchase, subscription, tiered pricing, etc.?
Cost: What’s the actual price point of their product or service? Are there various levels or packages available?
Sales and Discounts: Monitor their promotional activities. Do they offer seasonal sales, discounts, or loyalty programs?
Perceived Value: How does the price align with the perceived quality and value of the product? Is it positioned as a premium or budget product?
Advertising Channels: Identify the platforms they use for promotions. This includes social media, paid ad campaigns, SEO, print media, television, radio, and more.
Emphasis: What aspects of their product or service do they highlight in their campaigns? Pinpoint their unique selling proposition—the main factor that they claim sets their product apart from the rest.
Company Story and Branding: Understand the narrative they’ve built around their brand. How do they communicate their brand values and identity to the market? Do they have a Story Brand website, or are they using more generic marketing?
Sales Platform: Determine if they primarily sell online or have a brick and mortar place of business.
Distribution Method: Analyze if they sell directly to customers or use intermediaries, partners, retailers, or third-party platforms.
Strengths and Weaknesses
This is a reflective process where you evaluate all the above components collectively. Why might customers gravitate towards these competitors? What gaps in their offerings might make customers seek alternatives?
This gives insights into the company’s purpose, goals, and values. By understanding their mission, you can discern their long-term objectives, what they stand for, and the image they’re trying to project.
By systematically going through these components, you can gather a comprehensive understanding of your industry competition.
Need Help Using Competitor Analysis To Find Your Competitive Advantage?
There’s two key areas that we’ve found it very useful to put a focus towards when it comes to competitor analysis.
1. Competitor Analysis For Social Media Strategy
By closely examining your competitors’ social media behaviors, you can gain insights into what platforms your competitors are on, which types of content seem to be resonating most with your target customers, and which platforms appear to yield the highest engagement.
Studying the successes of your competition on social media offers a valuable benchmark into what you should and shouldn’t incorporate into your social media strategy.
2. SEO Competitor Analysis
Performing an SEO competitor analysis can be very useful. This is typically one of the first steps we take at Alchemy when working with a new client.
We have a tool that allows us to run an SEO analysis on any domain, so we could run one on your website and your competitors’ websites. With the information this tool provides, we can see all the keywords your website is ranking for, as well as all the keywords your competitor’s sites are ranking for in the SERPs (search engine results pages).
We can also see what position you and your competitors are ranking for specific keywords. This means we can analyze which keywords your competitors are ranking higher for.
We can then use this competitive analysis to put together an SEO strategy that will help you capitalize on missed opportunities and ultimately, outrank your competition in the search results and drive more traffic to your website.
At Alchemy, we know that navigating the landscape of competitor analysis can be intricate and time consuming, but you don’t have to do it alone. Our team is seasoned in executing competitor analysis for businesses across a variety of industries. We can gather key insights and translate those into a strategic marketing plan, tailored for your brand. If you’re ready to gain a competitive edge in your market, give us a call at 877-978-2110, and let’s chart the path!