A competitive analysis seems to be a “no brainer.” However, I think that we can all agree that business leaders, managers, and marketing professionals frequently forget to incorporate consistent scrutiny, examination, and monitoring of the competition as part of their marketing strategy. Sure, we say that we know our competition, but it’s usually on a superficial level. One of the first questions that I ask a new client is, “Who are your competitors?” The typical client response is a shortlist of competitor names, with little accompanying information. So what is missing?
A lot!
Any marketing strategy must take into consideration what is happening at other businesses, not just your own. By understanding and monitoring your competitors’ offerings, e.g., size, marketing campaigns, rankings, ease of contact, unique offers, and customer engagement, you can adjust your marketing efforts to better align your company with your target customers’ needs. To do this, you will need to conduct a comprehensive competitive analysis.
What is Competitive Analysis?
Entrepreneur.com defines competitive analysis as the following:
“Identifying your competitors and evaluating their strategies to determine their strengths and weaknesses relative to those of your own product or service.”
A detailed competitive analysis can provide insight into:
- Industry trends.
- What products/services are similar to yours, and how you can differentiate yourself.
- How competitors are marketing their products/services.
- What your competitors are doing right and where they are falling short.
- Your value proposition as it relates to the competition.
- What customers are saying about competitor services.
Identifying Your Competitors
To get started, identify businesses that share the same competitive space and whose products or services are similar to your offerings. But remember, just because a business is in the same industry does not necessarily mean it is a direct competitor. For instance, a law firm that focuses on family law will have little impact on a firm that focuses on commercial real estate or employment law.
Competitive analyses take time, so pick the top three or four competitors rather than a list of a dozen or more. A quick way to find out who you’re up against is to conduct a keyword search via Google
You can also leverage search listening or social listening to gather more insight. Investigate:
- What brands are consumers talking about?
- What products or services receive the most recommendations?
- What are customers saying in their reviews?
Finding Where You Fit In
The better you understand your competition, the easier it is to take advantage of unmet customer needs. If you want to boost sales of a particular service, look at how others are marketing similar services, what is most attractive about their offer, and how their service measures up. You may find notable differences in pricing, warranties, customer loyalty programs, and convenience offerings.
By studying and evaluating the data against your businesses’ offerings, you begin to develop a clearer picture of your standing in the marketplace, where there are opportunities for improvement, and ways you can refine your own sales process.
Measuring Up – Where Marketing is Taking Place
A competitive analysis examines not just the sales volume but how a competitor interacts with the consumer. Spend time reviewing your competitors’ websites and social media. Take note of things such as:
- Social media channels and engagement.
- Audience response to blog topics.
- What topics are generating the most likes, shares, and comments.
- Marketing platforms: Is the competition using video, podcasts, webinars, or eBooks?
- How customers can connect.
- Campaigns and promotions.
Studies have shown that recommendations on social networks are the most significant driver for consumer purchases, with 37% of consumers finding purchase inspiration through the channel. If you’re not keeping pace with your major competitors, you’re losing out on potential sales.
Adjust your marketing approach based on your research and how those changes may better position your company. Actions may include:
- Revamping your website to include FAQ or customer testimonials.
- Providing in-depth information about your products or services, including tutorials, chat boxes, or hotlines.
- Building an editorial calendar that focuses on topics customers are most interested in or where you have expertise.
- Establishing a presence on different social media sites such as LinkedIn, Instagram, or YouTube to present your products/services in a new way.
How Often Should I Conduct a Competitive Analysis
The primary purpose of market research is to provide a business with current and relevant information about trends, opportunities, and threats in the marketplace. Every day, a new business is launched, and an existing business closes its doors. Therefore, systematic market research is a necessity. I recommend conducting research, at least quarterly, if not monthly. However, a new product or service launch or a territory expansion necessitates further analysis.
Boosting Your Marketing Efforts
Effective marketing is flexible and forward-thinking. Balancing a macro approach with a microfocus (think tactical) enables you to create a marketing strategy with all of the elements necessary to position your business as a leader within your space. Use the data about what your competitors are doing to challenge yourself to do better and fine-tune your marketing plans.
Once you define your goals, you can implement strategies to generate positive results. You don’t have to reinvent the wheel; just tailor your efforts to align with your unique selling proposition and target audience.
Conducting a competitive analysis should be a starting point when it comes to developing a marketing plan. YGL Enterprises can help you gather all of the information and insight you need – and decipher what it means for your business. Contact us today to get the process started.
Yvonne Levine, president of YGL Enterprises, Inc., is a strategic marketing consultant who collaborates with professional services organizations and small and mid-sized businesses to develop and execute successful marketing strategies, branding initiatives, content creation, and digital marketing plans. By helping businesses devise a targeted strategy first, the approach creates a strong foundation for tactical decisions, which drives brand awareness and positive results. Follow Yvonne on LinkedIn and Facebook.