Whether you’re just thinking about your go-to-market strategy or searching for ways
To expand your firm, a comprehensive examination of the competitive environment is critical for success.
This is where competitive analysis comes into play,
becoming your primary source of market and competitive knowledge,
which is required to assure growth and preserve or expose your competitive edge.
Competitor analysis, when handled correctly, may become a wealth of ideas
that can help you make data-driven and more efficient decisions, assisting you in:
Finding new market opportunities and increasing your market share;
Identifying gaps in your and competitors’ marketing efforts;
Prioritizing your marketing and product development investments;
And Discovering upcoming market trends and shifts in your competitors’ marketing,
audience, and product strategies.
This post will walk you through the major stages of competition analysis,
demonstrating how to streamline and automate
The process and revealing how the insights collected can be transformed into meaningful business choices.
What Is a Competitor Analysis?
Competitor analysis, an essential component
of market analysis, is an in-depth examination of your competitors’
digital footprints, allowing you to gain consumer, product, and marketing information on your rivals.
The insights you gain from researching your competition
may help you remain on top of market trends and developments, allowing you to
modify your company and marketing tactics to reflect industry best practices and changes.
Competitor analysis enables organizations to utilize the power of competitive information
and channel this knowledge into enhancing their market positions,
from discovering untapped growth possibilities to remaining attentive to rivals’ capabilities.
How Often Should You Revisit Findings From Competitor Analysis?
In contrast to a go-to-market plan, competition analysis is not a one-time event;
With each iteration, you should be prepared to adjust your tactics based on newly
found insights in order to capitalize on rivals’ vulnerabilities.
According to Forbes, just 1% of a marketing department’s work
should be spent on competition analysis; others prefer the 80/20 rule
(80% of a CMO‘s time should be focused on own-brand expansion and 20% on rival research).
The frequency of competition analysis will differ from one firm to the next.
You might be able to get away with a yearly review if you work in a steel factory,
But in other industries, such as fashion e-commerce, tactics and rivals are
continuously changing, so a quarterly re-evaluation of the competitive environment is required.
Although time-consuming, this work does not have to be gloomy
because you can utilize all of the
martech tools available to assist you to automate the competitive analysis process
Gathering Competitive Insights
Competitor analysis is a step-by-step procedure in which you acquire
specific information about your competitive environment at each level.
Of course, you may always add or delete sub-steps, but the overall idea is to:
Discover the major players you are competing against;
evaluate how they compare to the market; identify your competitors’ specific tactics
Whether it is the audience, product, or marketing.
And benchmark them against yours to find their (and your) market strengths and weaknesses.
Step #1: Select Key Competitors
The effectiveness of your competitor analysis
will be primarily determined by the rivals you choose to evaluate.
When doing cursory research, you may strive to include all
Potential competitors from direct to indirect o
you may just focus on the most established industry companies.
A fast Google search and common sense will suffice in this situation.
Direct rivals provide goods that are identical to yours and operate in the same market,
Both in terms of audience and geography.
The most visible example is the competition between McDonald’s and Burger King.
An in-depth study should focus on your closest direct competitors
Based on geography, audience, and market share characteristics.
At this point, you aim to have a thorough understanding of your competitive environment.
Assume we are developing a market plan for Any-Home, a new business
Trying to compete with Airbnb.
We can quickly determine
Step #2: Investigate Your Competitors’ Digital Footprints
Once you’ve narrowed down your list of rivals, it’s important to delve into their
Digital strategy, paying particular attention to their
market share, target market, finest products or services, and marketing methods.
Assessing your rivals’ market share
Even if you’ve already chosen your competitors based on market share,
You need to obtain a clear picture of where each competition sits about you and the entire market.
It may be hard to estimate in the offline
world unless you incur significant money
by hiring the likes of Nielsen or Gartner.
However, in the internet world, traffic share figures
may be used to estimate your competitors’ market share.
Why should you worry about this metric?
You may strive for product perfection or marketing excellence,
But if your rivals have a sizable market share, this may suggest whether product
(marketing or customer service) standards are ‘good enough for your target audience.
When doing a competition study, it is critical to understand how your competitors
advertise their products and which market techniques have the greatest impact.
By market tactics, we mean analyzing your rivals’ online presence, marketing
(traffic creation), and go-to platforms.
Pinpoint Your Rivals’ High-Impact Traffic Channels
This means that in terms of client acquisition, they are mostly focusing on brand recognition and SEO.
An analysis of your competitors’ primary traffic sources will help you determine
which user-generation tactics are most effective for your competitors and, as a result,
may represent a danger or opportunity for your business:
Strong direct traffic generally implies that
the business has a high level of brand recognition
among its target demographic and is investing much in brand marketing initiatives.
So,High search traffic indicates that the brand’s
website is well-optimized for search and attracts
the majority of its audience by having excellent search visibility.
High referral traffic might indicate that the company has a broad network
of non-paid marketing and media relationships
and invests in positive reviews and recommendations.
Paid traffic indicates that the brand is investing big funds
and/or has a well-thought-out online advertising plan.
A high level of social traffic implies a strong social media presence and strategy.
Discover Which Audiences (GEO) Your Rivals Are Targeting
While you’ve picked your rivals based on the fact that you’re both
targeting consumers in comparable areas,
you should also keep an eye on what other markets they’re pursuing.
The same Traffic Analytics tool reveals that, in addition to the United States,
Any-Home may target consumers in Germany, Canada, Columbia, and Brazil.
In other industries such as fashion or entertainment, this is an important step to consider,
As many Asian streaming platforms, for example, target Asians living abroad,
who frequently make up the largest fraction of their audience.
Following market tactics, you may investigate your competitors’ marketing plans,
adopting a more detailed approach and delving into their SEO,
content, advertising, and social media techniques.
So,With this information in hand, you may begin evaluating your existing marketing techniques and initiatives.
Step #3: Explore Changes in Your Competitors’ Product and Targeting Strategies
You already know that you have a fairly comparable product range and audience.
Because you picked the proper competitors to measure yourself against,
But it’s vital to keep an eye on any changes in your rivals’ products and target personas.
Pinpointing audience and product shifts
So,Understanding which pages are experiencing the most traffic variations
allows you to predict any potential changes in your competitors’ products and targeting decisions.
According to Traffic Analytics statistics, Any-competitor Home’s Vrbo
used to get the most traffic to its services in the southern states of the United States –
Florida and California – suggesting that they were targeting Americans seeking a vacation or good warm weather.
In October 2020, however, the most popular destination page was dedicated to
clients searching for an alternate location to work from home (WFH).
This, of course, is a pandemic-related shift in both product and audience.
However, these insights show how fast your rivals adjust to shifting market
circumstances and whether their efforts are fruitful.
Understanding where the new traffic comes from
So,If your competitors have invested in new items and are potentially bringing new audiences
to their sites, the next natural step is to learn how they advertise their new products.
The same Top Pages data that we looked at before to detect audience and
product movements also indicate which channels your rivals spend in to drive traffic.
In the case of Vrbo, it appears that they entered full social media mode
while advertising their WFH product, which is prudent considering
that social media usage has risen dramatically during the epidemic.
Following your rivals’ customer journey
Your competitor analysis should not end at determining where your competitors’ traffic originates;
You should also investigate where the audience travels next to divert competitors’
audiences with your product and target them with your advertising and other marketing efforts.
So,According to the Traffic Journey study, Any-top Home’s competitors’
viewers primarily leave their sites to visit Google and Facebook,
thus it’s ideal to grab them on these platforms by perhaps investing in Google and Facebook ad promotions.
Turning Competitor Analysis Insights Into An Action Plan
Once you’ve acquired all of the required competitive insights, you must progress
from viewing a collection of valuable strategic recommendations to developing a
full-fledged action plan.
Although you might spend time studying your newly discovered data, you may instead
lay it out on a Strategy Canvas, which is included in the Blue Ocean Strategy book.
This canvas will assist you in illustrating your findings on a single canvas to
discover your rivals’ shortcomings and strengths, as well as to measure yourself against them.
So,The book shows how Southwest’s
(the pioneer of low-cost air travel in the United States)
Strategy Canvas might appear if they were competing with other airlines and car rental firms
(direct and indirect competitors)
Using the example in this book as a guide, you may build your canvas,
With the major product or marketing attributes you’ve studied on
the horizontal axis and the high/low or strong/weak
ratio on the vertical axis, and begin charting your and their plans.
Using the Strategy Canvas logic, you will be able to analyze your and your rivals’ strong
And weak aspects, as well as quickly identify
opportunities for development, which should result in concrete business outcomes.
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