Why Competitor Analysis Should be at the Top of Your To-Do List
Many businesses feel it is unnecessary to perform a formal competitor analysis as they feel they have a good understanding of their competition. The reality is, however, that with the power of the Internet and constantly changing trends and consumer behaviours, it would be near impossible to keep up-to-date with everything your competitors offer.
At TWI, we know from experience that a regular competitor analysis is a crucial part of a marketing mix, and is essential in understanding where your business sits in the marketplace.
What to Consider When Constructing a Competitor Analysis
When constructing your competitor analysis, it is important you look at not only the services/ products your competitors offer in relation to your company, but also, how they sell and market them. For instance:
* Do they have an up-to-date, mobile-friendly website?
* How clear and effective is its content and messaging?
* Do they have an e-commerce website?
* Do they have Facebook, Twitter, Instagram, LinkedIn?
* If so, how many followers do they have and how frequently do they post?
* How engaged are they with their client base?
* Are they featured regularly in consumer or trade press?
* How highly do they rank on Google and other popular search engines?
* What are their customers saying? Do they have good online reviews?
* Are they announcing new products and services?
* How do they deliver their product/ services?
* How does their pricing structure compare to your own?
* What are their operating times? Do they use online chat?
* Do they have bricks and mortar stores, if so, how many and where are they based?
Start by composing a list of the top five competitors (aligned with your business in size and/or location). You can then compare the different approaches and see how your business fits into the marketplace.
What are the Key Benefits of Performing a Competitor Analysis?
Although the process can be time consuming, once you have gathered and organised the information, you have it ready to make informed decisions, time and time again. Your marketing team can even use the analysis to benchmark activity and plan campaigns. When performed properly, in a useful and digestible format, the benefits far out way the time and cost it takes to produce.
A competitive analysis can serve three main useful and beneficial purposes:
It determines the strengths and weaknesses of your competitors
By establishing the strengths and weaknesses of your competitors you may discover effective tools that your business should use, whilst eliminating some tools that are proving ineffective. It may also help you to establish a niche market or way to deliver the product to your customer in a way that is not already being used. Establishing a competitor’s weakness (especially of those in proximity of your business) will mean you can use that weakness to your advantage by developing ways to make the product/ service more desirable to the target audience.
It lets you see things from the eyes of the consumer
A competitive analysis will let you compare the different options in the eyes of the consumer. You can then start to ask questions – ‘what option would I pick and why?’ Once you know what the market looks like from the eyes of the customer, you can start to shape the project to better appeal to the target consumer.
It gives you new ideas and helps you stand out from the crowd
Being able to determine exactly what your competitors sell, how and when allows you to act creatively and think of different ways to deliver your product or service. This may also help you create and market your USP (unique selling point) – this is key to differentiate your business. Take Deliveroo as an example. In 2017, a competitive analysis would have helped them establish:
* Just Eat (their main competitor) was allowing fast food chains to be more profitable
* Eating in and ordering take-out was a growing trend
* Most restaurants didn’t offer a delivery service
* Just Eat and other delivery services didn’t help fulfil orders – only get them
* There was a gap in the market and a way to disrupt their competitors by offering an ordering and delivery service to restaurants
‘Providing a network of dedicated couriers and an ordering platform, to make it easy for restaurants which wouldn’t otherwise offer delivery to do so.’ Today, Deliveroo is a multi-billion-pound company that has seen revenue growth of 650% year on year and has created thousands of jobs in the restaurant sector.
We hope that we’ve shown you the importance of performing a competitive analysis and how it can help you shape your strategy and develop an effective marketing plan.
If you need help constructing a competitive analysis or if you need access to a dedicated marketing team, with years of experience, fresh ideas and a results-driven approach, contact TWI today for a no obligation chat on 01473 326907 or email firstname.lastname@example.org
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