Do you know what your competitors are doing? If not, you’re at a disadvantage.
Competitor analysis is the process of studying your competitors to find out what they are doing that is working well and what areas you may be able to exploit.
Advantages of conducting competitor analysis
- Beating your competition on cost
- Product or service differentiation
- Organic traffic acquisition
- Exploiting the deficiencies in their digital marketing strategy
- Forecast market potential
- Monitor the economic climate
- Track competitor products
- Increase conversion rate
You can position your business for success and stay ahead of the curve by understanding your competition. This blog post will discuss the benefits and advantages of competitive analysis and how it can help your business grow!
Benefits Of Analyzing Competitors
One of the benefits of conducting competitive analysis is that it can help you forecast market potential. By understanding what your competitors are doing, you can get a better idea of the size of the market and how much room there is for growth.
Additionally, competitor analysis can help you monitor the economic climate and track competitor products. This information can help plan your product launches and marketing campaigns.
Another critical benefit of the competitive analysis is increasing your conversion rate. By understanding what your competitors are doing well, you can mimic their tactics and improve your chances of converting leads into customers.
By exploiting the deficiencies in your competitor’s digital marketing strategy, you can steal market share from them and gain more organic traffic! Understanding what they are doing well can help you position yourself as a leader in your industry while also identifying areas where they may be vulnerable.
Competitive analysis is a powerful tool that should not be overlooked!
Competitive Analysis Techniques
Do you ever feel like you’re always one step behind your competition? It can be frustrating, especially if you don’t know how to stay ahead of them. By understanding what your competitors are doing, you can adjust your marketing and sales strategies to give yourself an edge.
Competitor Analysis Four Corners
The competitive analysis of four corners is a technique that allows you to look at your competitors’ strengths, weaknesses, and market opportunities. Note: This is not a SWOT (strength, weakness, opportunity, threat) analysis because it has a different corner that helps you think about the competitive environment.
To complete a competitive analysis of four corners, you’ll need to answer the following questions:
- What are your competitors’ strengths?
- What are your competitors’ weaknesses?
- What opportunities exist in the market that your competitors may not be taking advantage of?
- What threats does your competitor pose to your business?
Analysis of Driving Forces
The study of driving forces is another competitive analysis technique that can help you understand your competitors’ strategies. To complete this analysis, you’ll need to identify the five main driving forces in your industry:
- Threat of new entrants
- Bargaining power of buyers
- Bargaining power of suppliers
- Threat of substitutes
- Intensity of competitive rivalry
By understanding these five driving forces, you can better understand how your competitors are behaving and what strategies they may be using to succeed.
Industry Analysis Five Forces
The industry analysis five forces is another competitive analysis technique that looks at the overall industry in which your business operates. This analysis will help you understand how competitive your industry is and what factors influence competition.
To complete an industry analysis of five forces, you’ll need to answer the following questions:
- What are the main competitors in this market? Who do they compete with most (and least) directly? Which of these competitors has been successful or unsuccessful?
- What is the competitive intensity in this market? In other words, how competitively does each company compete for customers and market share?
- What are the bargaining powers of buyers and sellers in this industry? How easily can buyers switch to a different supplier or product, and vice versa?
- What are the threats posed by new entrants to this market? What competitive advantage does your company have over new entrants or vice versa?
- What are the threats of substitute products to this industry? Do these substitutes pose a real threat or just perceived ones (e.g., brand loyalty)?
Life Cycle of Product
The product’s life cycle is another competitive analysis technique that looks at how a product progresses through its life cycle. This analysis can help you understand your competitors’ strategies and what products they focus on.
To complete a life cycle of competitive product analysis, you’ll need to answer the following questions:
- What stage is your competitor’s product in? Introduction, growth, maturity, or decline?
- What is their competitive advantage over other products in the same stage of the life cycle (e.g., price, quality)?
- Is there anything unusual about your competitor’s product that makes it stand out from others? If so, what are those differences, and how can they be used to your advantage?
- What strategies are most effective for competing in this stage of the product life cycle?
- What are the risks and opportunities associated with this stage of the product life cycle for your competitor’s product?
The SWOT analysis is a competitive analysis technique that helps you understand your company’s strengths and weaknesses and the opportunities and threats in the market.
To complete a SWOT analysis, you’ll need to answer the following questions:
- What are your company’s strengths? What advantages does your company have over its competitors?
- What are your company’s weaknesses? How can your competitors take advantage of your weaknesses?
- What opportunities exist in the market that your company can capitalize on?
- What threats exist in the market that could potentially harm your company’s competitive position?
The win-loss analysis is a competitive analysis technique that helps you understand how well your company competes against its rivals. This analysis can help you identify areas where you are winning and losing against your competitors.
- What competitive factors are most important to your customers? Quality, price, service level (e.g., speed of delivery), etc.?
- Why do you think your customers choose your product or service over those offered by other companies in the industry? Is it because they perceive that their needs will be met better from using your company’s products or services?
- What competitive factors are most important to your customers, but you are not performing as well as you would like? Why do you think this is the case? Are these areas where you can improve and win back market share from your competitors?
- Which of your competitor’s products or services are winning against yours? Why do you think this is the case?
- Are there any competitive factors that you are winning against your competitors but not getting as much market share from them as you would like to have? Why do you think this is the case, and what can be done about it?
- Is there anything unusual about your competitor’s product or service that is helping them win against you? If so, what are those differences, and how can they be used to your advantage?
- What competitive strategies have been most effective for competing against your competitors in the past? Are these strategies still working, or do you need to change them?
By using competitive analysis techniques, you can better understand how your company is performing against its rivals and what you need to do to stay ahead of the competition.