Digital Marketing

What is a Competitive Analysis — and How Do You Conduct One?

Do you ever wonder what makes your competition tick? You need to understand their strengths and weaknesses as it can be a game changer for your business. When you hold a competitive analysis, you dive deep into your competitor’s strategies, giving you valuable insights to make your marketing strategy better.

Why Conduct a Competitive Analysis?

There are several reasons why a competitive analysis is a must-do for any business:

  • Identify Your Differentiators: When you hold a competitive analysis, you know what sets you apart from the crowd. You can use these pointers to brainstorm unique selling propositions (USPs) that resonate with your target audience.
  • Learn from the Best: Learn from the success stories of other brands. Ask yourself what they are doing right that you aren’t. Ask how you can implement these winning strategies to fit your brand.
  • Benchmark Your Progress: When you analyse your competition, you can compare your performance against theirs. This also helps you identify where you need to improve and stay on the cutting edge of your industry.
  • Know Your Audience: By getting to know your competition’s marketing techniques and tactics, you get valuable insights into what your target audience prefers and their pain points.

The 5 Steps to Competitive Analysis Supremacy

Now that you understand the importance of competitive analysis, let’s break down the steps to conduct a thorough analysis:

  1. Identify and Categorize Your Competitors: List your direct and indirect competitors down. Direct competitors offer products or services that are similar to yours to the same target audience. Indirect competitors are focused on solving the problems but with a different solution. Once you have made the list, categorise them by size, legacy, and disruption level. 
  2. Map the Competitive Landscape: Once you’ve made a list of your competitors, you need to visualise their market position. Create a graph with “Market Presence” on the Y-axis and “Customer Satisfaction” on the X-axis. Plot your competitors on this graph to identify leaders, contenders, niche players, and high performers.
  3. Benchmark Key Competitors: Deep dive into the top competitors you identified in step two. Here are some key areas to consider:
  • Quality: Assess the quality of your competitor’s products/services. Look for customer reviews and compare features.
  • Price: Analyze their pricing strategy and how it compares to yours.
  • Customer Service: Evaluate how they deliver support (chat, phone, email, etc.)
  • Brand Reputation: What kind of reputation do they have in the market?
  • Financial Health: If possible, find data on their revenue growth and profit margins.
  1. Dive Deep into Their Marketing Strategy: How do your competitors reach their target audience?
  • Website: Analyze their website content and structure to understand their brand voice and positioning.
  • Email Marketing: Subscribe to their email list to learn about their content style, cadence, and offerings.
  • Social Media: See how they use different social media channels and what kind of content resonates with their audience.
  • Content Marketing: Explore their content strategy, including blog posts, ebooks, webinars, etc.
  1. Perform a SWOT Analysis: Lastly, conduct a SWOT analysis for every competitor. It will help you analyse their Strengths, Weaknesses, Opportunities, and Threats. You will get to know about their vulnerabilities and help you capitalise on your own strengths. 

A competitive analysis is a great tool that will give you an edge in the marketplace. By understanding your competition, you can develop a winning strategy that will attract customers and drive sales. What are you waiting for? Start your competitive analysis today!