Trying to stay one step ahead of the competition can be time consuming, but it’s necessary for your company to grow. This is why properly conducting competitive analysis in marketing is so important. It will help you identify who your competitors are, what strengths and weaknesses they have and whether or not they pose a potential threat — or perhaps even an opportunity.
Laying Down the Competitor Analysis Framework
Conducting competitive analysis goes far beyond simply running a quick Google search for your competition. While the process is straightforward and simple enough, you need to lay down the competitor analysis framework before diving in.
Find Your Competitors
First, you need to identify who your competitors are. Knowing who you’re up against is crucial to establishing the right marketing techniques and scaling your business. Your competitors are just as determined as you are, and you can be sure they’ve researched your company, as well.
Start identifying competitors by typing your keywords into Google search and seeing what comes up. If your business is not ranking in the number one spot, that’s your first problem. Having a higher search engine results page (SERP) ranking should be at the top of your priorities list. If that spot is taken by one of your competitors, that’s the business you should turn your attention to first.
Also, pay attention to competitors ranking on the first page. They are probably doing their own research and trying to figure out how to take that top rank, too. Essentially, you want to cast a wide net to gather as much collective information as possible about your market.
Once you’ve identified all of the major players on the board, you can start sifting through their digital media. Take a look at their social media content, websites, reviews, online communities and even mentions in the news. This will give you a better idea of how much they are currently dominating the space within your niche.
This is where the work truly begins. Google doesn’t just hand over this type of information. You will need to enlist the aid of a few digital spy services such as Keyword Spy, Hoovers, Alexa, ReferenceUSA and Ahrefs.
Organize the Data
With the competitor analysis framework laid out, you can now start to organize your data and categorize your competitors.
The easiest way to do this is to arrange your competitors by levels of relevance to your business. For example, you could organize them in primary, secondary and tertiary levels. This makes it easier to keep all your data straight.
Primary Level ─ Here is where you should place your direct competitors. These are the ones that sell the same products, market towards the same target audience or do a combination of both.
Secondary Level ─ These competitors sell similar products at a higher or lower end. In other words, they are reaching a different market.
Tertiary Level ─ In this category, you will place competitors who sell products that are related to yours. It’s important not to leave these competitors out because they can be invaluable when you are ready to expand your brand or form a partnership with a beneficial company.
Organize your data into a spreadsheet and include the following information:
- Competitor’s Name
- Mission Statement
- Level of Competition
Websites and Reviews
Another factor for conducting a competitive analysis in marketing is to comb through their websites and look for reviews. You can get a lot of fresh ideas from taking a peek at their site, and you can learn about customer pain points by reading the reviews.
Factors you should pay attention to on your competitors’ websites include:
- Landing Pages ─ Are they dynamic and well-thought-out?
- CTAs ─ Where are the call to action buttons? Are they clearly visible?
- Color Scheme ─ Does it fit with the theme of the company?
- Social Buttons ─ Which social media platforms is this competitor using?
- Photography ─ Are the images professional and deliberate?
- Product Descriptions ─ What information is included and what is missing?
- Contact Page ─ Does it include the hours of operation and phone number?
- Blog ─ What kind of articles are posted and how frequently?
- Mobile-Friendliness ─ Does the site load quickly on a smartphone or tablet?
You can go into further detail under each point and you can also come up with your own list that is geared more towards your specific business. Just remember to practice good note-taking techniques when doing your research.
As for reviews, these are critical in understanding your competitors’ strengths and weaknesses. When customers are happy, they will leave glowing reviews. When they are mad, they will leave extensive comments about their negative experience. Both of these are great for you because it lets you know where your competitor is lacking and where they are excelling. This type of data will fit perfectly into your competitor analysis framework and it will give you a well-rounded understanding of your industry and its customers.
Digital Marketing Tactics
Now that you have a better understanding of who your competitors are, you can turn your attention to studying how they present themselves to their target audience. Competitive analysis in marketing can be a little bit tricky and take some time, but it is highly beneficial.
You can start by signing up for their newsletter. This will give you a better comprehension of how the company communicates with its audience and what type of business practices they follow.
You should also subscribe to their blog and follow them on social media. This will show you what kind of content they post, when that content is published, and what type of engagement they are getting. If social media is a key concern, you may even get some great ideas from your competitors to incorporate into your own digital marketing strategy.
Another effective way to collect data for competitive analysis in marketing is to go shopping on their site, put some items in your cart and abandon it. Then you can see what type of follow-up system they use (if any) to get the customer to come back and complete the purchase.
Finally, you can always buy something from them. This allows you to try out their product, see how quickly their processing/shipping time is and see what their remarketing strategy is. All of these are important questions to ask.
- Do you like the product?
- Was it shipped out in a timely manner?
- Did you receive a follow-up email?
The Price Factor
Some business owners may not like this, but the price of a product or service is a major determining factor for many people. If the consumer can get the same product for less somewhere else, they will. So, you need to figure out what your competitors are charging and price your products accordingly.
Of course, you still want to make a profit. The key is to give your target audience the ultimate reason to click that buy button. You could do this in a variety of ways, including offering a discount or free shipping. The number one reason why many potential customers abandon their shopping carts is because they see the total cost after shipping is factored in. If you can cover shipping costs with stipulations such as on orders over $50, you will boost your conversion rates and overall sales.
Price is a major element in the competitor analysis framework. It isn’t just about the product price either. For example, if you find that your competitors often hold social media contests or giveaways, then this is something you should consider doing too. It gets the target audience excited, brings in new leads and gets your products into their hands. If they love what they received, the chances of them becoming loyal customers are high. That’s how you can beat your competitors.
Social Media Activity
As we touched on briefly before, stalking your competitor’s social media accounts is a great way to get a better grip on how they interact with their customers. Since you’re in the same industry, their followers should be following you as well. If you notice that your competitors have larger followings than you, it’s very easy to figure out what their social media marketing tactics are and incorporate them into your own strategy.
How big their following is on various social media platforms is a good indication of where your target audience hangs out online. If you see a well-established competitor with a massive following on Instagram but not so many on Facebook, you may want to focus your efforts on Instagram because you know your audience is already there. On the other hand, there is an opportunity to maximize your efforts on Facebook to make up for the lack of interest in your competitor.
Take a look at the type of content they post and when it’s published. Also, note if the most popular posts are about their business or are simply fun posts meant to boost engagement.
There is always room for another success story and social media has made it easier than ever to gain a massive following in a relatively short period of time.
Wrapping Up Competitor Analysis
Now that you understand the basics of conducting a competitor analysis, you can run one on your competitors and see how much you learn about your industry and target audience.