In the US alone, there are over 102,728 brands with an online presence. And that’s just counting online retail companies.
As a digital marketer, you may wonder how it’s possible for a company to stand out amongst such an oversaturated market. Competitive analysis is a tried and true method for determining the current state of the market and how your brand can stand out from everyone else.
That’s why we’re guiding you through the basics of how to do competitive analysis. That way, you’ll have all the basics you’ll ever need to start making your brand’s presence stand out in the digital world.
Do you want to know what competitor analysis is and how to do it for your brand? Keep reading and we’ll tell you everything you need to know.
What is Competitive Analysis?
Competitor analysis is a strategy to improve your own marketing efforts by taking a look at what your competitors are doing. That way, you can stay a step ahead.
You can have someone do market research for you or you can do it yourself with nothing more than a laptop and a little Googling.
How to Perform Competitive Analysis
You may be wondering, why research competitors? Shouldn’t you be focusing on improving your brand presence? Yes!
But one of the most essential steps in improving your digital marketing strategy is to learn from your peers. Identifying weaknesses in the market gives you the chance to avoid the pitfalls of others and create a unique brand presence customers have been craving.
Now that you know why competitive analysis is important, here are the 3 steps you need to get started.
Step 1. Identify Your Competitors
The first step in a competition analysis is to identify your top competitors.
We recommend finding 10 competitors to analyze. More than this can become to wieldy and produce less precise results. Fewer than 10 competitors may not produce robust enough results to make a difference in your strategy.
Competitors should have something in common with your brand. Maybe they sell similar products or provide the same type of services as your company. Or maybe they target the same niche audience.
Most brands already know who their competitors are but, if you don’t, here are some tips to finding your top 10 competitors to analyze:
- Google the type of product or service you provide
- Pay for software that ranks your top competitors
- Poll your niche audience and ask them what brands are most like your own
Once you have your top 10, it’s time to break those companies down into more defined categories.
Step 2. Categorize Your Competitors
You’ll often see marketing experts define competitors by three categories: primary, secondary, and tertiary. This can also help you come up with new search terms while you’re identifying competitors in the first step.
Primary competitors are the ones you probably already know of. They’re the companies targetting your customers, selling the same products or services, and sometimes both. These are the brands you need to always have an eye on– even after you finish your competitive analysis.
On the other hand, secondary competitors are brands selling the same products as you but to a different audience. This audience may consist of higher- or lower-end buyers or maybe a different age group than your target consumer group.
Finally, tertiary competitors are those brands selling something related to your products though they probably don’t sell the exact product itself. For example, a company selling home and living items may have a tertiary competitor who sells textiles or wood products.
Now that you’ve categorized your top 10 competitors it’s time to get into the nitty-gritty.
Step 3. Analyze Your Competitors
You’ve identified and categorized them, now it’s time to research competitors.
The first step is to find them online and analyze their website. How’s the quality? Are the pictures in high resolution?
In today’s oversaturated digital world, having an aesthetic website presence can often make the difference in converting a new customer. Any competitors that are lagging in their digital presence give you an opportunity to take their customer base.
Next, determine their position in the market, including:
- How do they set themselves apart?
- Why is their brand unique?
- Why do customers like their brand?
Identifying competitor pricing is one of the more difficult aspects of competitor analysis. Many brands don’t publish their prices to keep competitors from seeing them. But you may be able to sign up for a consultation and determine the prices that way.
What are your competitors’ shipping policies? Shipping is an important factor in consumer decisions. If your competitors are offering free shipping and you aren’t, this is an aspect of your business that you can change to improve sales.
There’s no better way to determine how customers like a brand than to scour user reviews. This can also give you insight into what consumers are looking for in your niche but aren’t currently getting. That way, you can give them exactly what they want, putting you ahead.
Lastly, head over to your competitors’ social media platforms. How are their social media presences? Social media is a huge platform for finding leads so competitors who have less than stellar social presences are easy to outcompete.
More Digital Marketing Tips
By now, you should feel like a competitive analysis expert. But don’t stop there! Building a digital platform with a high potential to discover leads and drive sales requires more strategies than we covered here.
Check out our blog for more digital marketing tips and tricks.
If you want to start making your online presence stand out from the competition, check out our digital marketing services or contact us today to start getting ahead of the competition.