Running a competitor analysis is a vital step for every business looking to win in the race. Briefly, competitive analysis is a living report that identifies and assesses your competitors’ strategies to discover their strengths and weaknesses compared to your products and services. Understanding and applying the insights obtained through a competitive analysis help you identify your strengths and weaknesses and work on them to stay ahead in the game.
Four Key Ways to Analyze Your Competitors
To succeed in business, it is important to know the following things about your competitors:
- What range of products or services do they offer?
- How do they package their products and services?
- How do they price their products and services?
- How do they promote their products and what style of marketing copy they use?
Here are 5 Benefits you get from a Competitor Analysis:
1. Category Convergence
Today, category convergence is more important than ever before. When reputed brands expand and diversify their offerings, they start to compete in industries in which they don’t have a foothold. Many smart marketers have already started to regard the term ‘category’ as a misnomer. An energy drink in the food and beverage category can also be competing in the health and wellness category in the market, depending on the consumers’ understanding of the brand and category.
2. Identifying Market Gaps
An effective competitor analysis framework helps you identify the unserved or underserved areas or consumer groups in the market. This tool lays out competitors as per their unique service models, identify where they fit on a matrix with limits ranging from low price to high price, low customization to high customization and low quality to high quality, and. One of the most important benefits of competitor analysis is that it helps you to easily spot where your business stands in the market and where is a scope for improvement.
3. Determining Market Trends
Competitor analysis helps you identify the current trends in your marketplace, which empowers you with the ability to spot opportunities for differentiating and highlighting your services and products. Often, going against the grain can help attract a small but highly loyal customer segment in the market. Analyzing the market trends enables you to determine if you are in line with the current trends or following outdated trends for which you need to take corrective measures.
4. Improved Products and Services
As your business expands so will your customers’ requirements and expectations. The best way to forecast those needs and expectations is to conduct a comprehensive competitor analysis. Comparing your competitors’ products and services with yours allows you to tap into market gaps and understand customer preferences as well as your competitors’ pending improvements.
5. Amplified Content Marketing
There are several ways in which you can piggyback off your competitor’s content marketing and improve the traffic to your physical and online stores. By simply assessing their website content, blog, and social media content, you can identify what types of content are performing great and the frequency of their posting.
If you share a similar style of content, chances are high that your target audience will enjoy your content and stay engaged with your brand. Another effective way of spying on their content marketing is by observing how they use content to move their prospective customers down the marketing funnel. You may get ideas to effectively use your content to influence your prospects’ buying decision.
The importance of competitor analysis is very high for your business to stay afloat in the fiercely competitive world. Analyzing your competitors is a simple, yet effective marketing tactic to make sure that you are keeping up and matching the pace of your competitors and the industry, ensuring you stay relevant for your customers and don’t get drowned out against your competitors’ efforts. So, add competitor analysis to your marketing strategy to strengthen your brand’s position and expand online footprint.