How are competitors analyzed? Steps to creating a competitor analysis
1- Define the competitor:
Competitors can be divided into two categories:
Direct competitor: It is the company that offers a product or service that could be a similar substitute and operates in the same geographical area.
Indirect competitor: It is the one that provides products that are not the same but can meet the same customer need or solve the same problem.
These two terms are often misused as many brands when making a comparison focus only on their direct competitor.
Case in point: Stitch Fix and Fabletics are both subscription-based services that sell clothes on a monthly basis and serve a similar target audience.
But on closer inspection, it turns out that the actual product (in this case, the clothes) is not the same.
One brand focuses on stylish everyday wear while the other focuses on sportswear only.
By doing so, these brands satisfy the same need for women (having trendy clothes delivered straight to their doorstep each month), but they do so with completely different types of clothing, making them indirect competitors.
This means that the team at Fabletics won’t want to spend their time studying Stitch Fix too closely because their audiences may differ slightly and even if it’s just a little bit, that small difference is enough to make a big difference.
However, this does not mean that the indirect competitor should be completely eliminated, but rather it should be kept and monitored because it could turn into a direct competitor at any time.
2- Identify competitor products:
The competitor’s entire product line, the quality of the products or services it offers, the prices and any discounts it offers to customers must be analyzed.
Some questions to consider include:
Is it a low cost or high cost provider?
Does it work mainly on volume sales or one-time purchases?
What is its market share?
What are the characteristics and needs of his ideal customers?
Does he use different pricing strategies for online versus physical purchases?
How does this company differentiate itself from its competitors?
How does this competitor distribute its products/services?
3- Research the competitor’s sales tactics and results:
For publicly owned companies, annual reports can be found online.
But it does require some research to find this information from privately owned companies.
Some of this information can also be found through the CRM of the person doing the research and reaching out to those customers who have stated that they are considering a competitor.
This is done by referring to a report showing all potential deals where there was a specific competitor.
In the event that this data is not recorded, you can talk to marketing and sales to implement a system in which potential customers are questioned about other companies they are considering.
They ask leads (either through a form field or during a one-on-one sales conversation) to identify who their current service providers are, and who they’ve used in the past.
When a competitor is identified, they dive deeper by asking why they are considering the switch, positive or negative.
4- View the competitor’s prices and the privileges it offers:
There are some key factors that go into pricing a product correctly.
One key factor is understanding how much a competitor is charging for a similar product or service.
In the event that a product offers superior features compared to the advantages of the competitor, the owner of the product will consider making this product more expensive than the industry standards.
If he does, he will need to make sure that the salespeople are willing to explain why his product is worth the extra cost.
Or, conversely, it may aim to charge less than the competitor and appeal to potential customers who are looking for a quality product at reasonable prices.
You should also pay attention to what the competitor offers, such as a large referral discount or a free trial for a month, and offer similar or unique privileges, because these privileges may be the reason for losing customers.
5- Pay attention to the issue of shipping costs:
Free shipping is a major advantage that can entice consumers to choose one brand over another.
In the case of working in e-commerce, there is a need to look at the competitor’s shipping costs and ensure that those prices are met or even exceeded.
For example, if a competitor offers free shipping, you should follow the free shipping option, or consider how you can differentiate in other ways, including loyalty programs, holiday discounts, or social media gifts.
6- Analyzing how the competitor markets its products:
The quickest way to measure a competitor’s website is to analyze a competitor’s marketing efforts by looking for the following and copying the specified web page URL for future reference:
Does he have a blog?
Does he create white papers or e-books?
Does he post videos or webinars?
Does he have a Podcast?
Does it use static visual content such as charts and animations?
Does it have an FAQ section?
Are there featured articles?
Does he have a media kit?
Are there case studies?
Does it publish buying guides and data sheets?
What online and offline advertising campaigns does he run?
7- Knowing the competitor’s content strategy:
After completing the previous steps, you should take a look at the quantity and frequency of these items.
For example, if the competitor’s archive is strong, this means that it was publishing regularly.
In addition to monitoring and evaluating the quality of the content, if the quality is lacking, it will not matter how many times it is published because its target audience will not find much value in it.
Whn conducting a review, the samples should cover a variety of topics in order to form a fairly complete picture of what the competitor shares with their target audience.
8- Understand the types of technology your competitor uses:
For example when you see positive reviews about a competitor’s customer service – while doing research, it will become clear that they used powerful customer service software that you were not taking advantage of.
To find out which software is being used, the company URL must be written into Built with, which is an effective tool for detecting the technology a competitor’s site is running on.
Along with third-party plugins ranging from analytics systems to CRMs.
Another way to get information about the technology a competitor is using is to look at the competitor’s job listings that mention tools, especially for engineer or web developer roles.
9- Measuring the extent to which readers interact with competitor content:
This is done by checking the average number of comments, shares and likes on a competitor’s content and seeing if they are:
Some topics resonate better than others.
Comments are negative, positive, or a combination.
People tweet about specific topics more than others.
Readers respond better to Facebook updates about specific content.
You should also pay attention to whether the competitor categorizes its content using hashtags, and if it has social media follow and share buttons attached to each piece of content.
10- Pay attention to how the competitor promotes its marketing content:
After participation, we will move on to the competitor’s content promotion strategy, in other words, the keyword density in the copy itself, the ALT text tags, and the use of internal linking.
Through the following questions, priorities can be set and focus on what should be paid attention to:
What are the keywords your competitor is focusing on that haven’t been exploited yet?
What is the most shared and linked content?
What social media platforms does your target audience use?
What other sites link back to a competitor’s site but not yours?
Who else shares what the competitor posts?
Who refers traffic to a competitor’s site?
For the keywords to focus on, what is the level of difficulty?
11- Monitoring the competitor’s presence on social media, its strategies and the platforms it uses:
If a competitor is using a social network that you may not be on, it’s worth learning more about how this platform can help your business as well.
To determine whether this new platform is worth your time, you should check the competitor’s engagement rates.
First, you should visit the following platforms to see if the competitor has an account on them:
Facebook, Twitter, Instagram, Snapchat, LinkedIn, YouTube, Pinterest.
Secondly, this information must be obtained from each platform:
Number of fans/followers.
Posting frequency and consistency.
Engagement with content (Do users leave comments or share competitor posts?)
Content virality (how many shares, retweets, and retweets do competitor posts get?)
After collecting this and other data, an overall score is reached for the quality of the competitor’s content which helps to compare the rest of the competitors using a similar rating scale.
12- Conducting a SWOT analysis of the competitor:
While evaluating each component of a competitor analysis (business, sales, and marketing), it is best to conduct a simplified SWOT analysis at the same time to note its strengths, weaknesses, opportunities, and threats at any time the overall score is being evaluated.
Some questions to get started include:
What does the competitor do well? (products, content marketing, social media)
Where does the competitor have the advantage over your brand?
What is the competitor’s weakest area?
What distinguishes your brand from the competitor?
What can the competitor do better?
In what areas can this competitor be considered a threat?
Are there market opportunities identified by the competitor?
By comparing his weaknesses to your strengths and vice versa
