Are you launching a new startup or you are an established company but want to carry out a competition analysis?
Because of you, I have compiled 10 important things that matter for the competition analysis. I have listed only the top 10 most important points you need to consider.
In this guide, I will work you through how you can carry out a successful competition analysis that will put you at the forefront and outshine your competition in the market place.
But first of all, what is competition analysis and why is it important?
Competition Analysis is a field of strategic research which specializes in the mining, collection and review of information about rival firms or websites. This is an essential tactic you can use for finding out what your competitors are doing and what type of threat they present to your financial well-being.
It is important because it arms you with the ability to identify trends and adapt to competitors’ strategies and campaigns in order to out-compete them entirely.
So here we go,
- Identify your Top Competitors
Whether you are aware or not, the fact is there are competitors out there and they are just as hungry as you are. Everyone wants to have a piece of the good things.
To be able to identify your competitors, you can use Google and Amazon to carry out all your research and legwork. You can search your product ideas, business name or idea.
- Categorize you Competitors
When you are able to identify and list your competitors, you will want to categorize them into different levels. This include direct competitors and businesses that don’t currently compete with you but they might likely do in the near future.
An easy way for you to categorize them is:
- Primary Competition – These your direct competitors
- Secondary Competition – These are those competitors who sell a similar product to yours or serve the same audience as yours
- Tertiary Competitions – These are competitors that sell something that is related to yours
Keep all this information organized in a database or spreadsheet.
- Identify your Competitors Market Positioning
The next important thing is you need to identify whether your competitors are the market leader, one of several followers, or new to the marketplace.
When you are able to identify their market positioning, you will start to get a feel of your market’s expectations and demand.
You might also want to monitor their website and marketing messaging. You can do that by asking the following:
- What do consumers buy from them?
- What their customers going for experience or price?
- How do they differentiate their products or service from the competition?
- What makes their product or service unique?
- Identify and discuss key areas of competitive advantages and disadvantages
- Identify the Competitions Strength and Weaknesses
You will need to make a realistic assessment of your competitor’s strengths and weaknesses as they are viewed by the market.
You need to identify why your competitors do better than your company and also identify where they are weak and lacking behind.
- Content Engagement
You need to be able to gauge how engaging your competitor’s content are to their readers, also see how their audience respond to the content they are posting.
On their websites and social accounts, check the average number of shares, comments and likes on their content. Some things to find out:
- If the comments are positive or negative
- People are sharing and tweeting about specific topics much more than others
- If certain topics resonates more than others
- Investigate their Customer Acquisition Strategy
You might want to breakdown and analyze their source of traffic. Whether they get their traffic organically, or through referral and or other traffic sources.
You need to be able identify what is working for them and what is not working for them. Things you need to look for are:
- How do they get their traffic?
- From what geographical location are their customers coming from?
- Are they being referred or they coming from social media or advertisement?
- Review their Social Media
There’s a lot of benefits that come with looking at your competitor’s social media. You will be able to have an idea of how customers feel about their business. You will be able to see what works for them and how your target client base is engaging.
By doing this you will be able to know if you will need to step up your game and come up with new ways to start engaging your target market.
Another thing is if your competitors don’t have a decent follower, this indicates that your target market is weak and you might need to start thinking of target a different market.
It could also be because your target market is not on social media. So, you might have to use other channels to market to them.
Things to consider here include: What social media channels do they use, how often do they post, how they speak to their client base etc.
- Find Out about Funding
Find out if your competitors are seeking additional funding. This information will be able to tell you how well they are doing and it will provide you with ideas on how to position yourself.
- Take a Peek at their Pricing
Pricing strategy is one of the most important aspects of any online business and yours is no exception. Pricing is also a potentially competitive advantage.
There are a lot of factors that you need to consider when it comes to setting up prices for your products and services.
The best way to set your process is to look at how your competitors have priced their products. By doing this you will get a fair understanding of what prices might work for you.
- Content Promotion
You will definitely want to lay your hands on your competitor’s content promotion strategy. Promotional strategies like keyword density, use of internal linking and image ALT text tags.
Some questions you will need to ask are:
- Which keywords are they focusing on?
- Which of their content is highly shared?
- What other sites are linking back to their website?
Now you are one step closer to gaining market share, growing sales and staying ahead of the competition.
Try as much as possible to schedule a competitive analysis on a regular basis because competition can change quickly, new players can also emerge and the economy is constantly going upward and downward.