What is Competitive Analysis & How to Do it?

“If you don’t know what your competitors are doing, you have no idea what you’re up against.” – Jay Baer

Suppose you are an entrepreneur having an insurance company dreaming to conquer the insurance industry and grow the business exponentially. The aspirations only can’t help you to become the largest market shareholder. For accomplishing it you need to know what all things you have to do to become a leader in the industry. Here competitive analysis comes into play.

What is Competitive Analysis?

Competitive Analysis is the process by which we identify the strength and weakness of our top competitors in the market, explore the running trends in the market and consumer behaviour. It also involves analysis of strategies, tactics and performance metrics of our top competitors.

Why is Competitive Analysis Important?

Competitors are the one who helps us to do understand where we stand right now and what we should be doing to win the competition. Following are some of the things that clearly explains the reason behind competitive analysis:

1. Strategic Insights: Identifying the strategies used by our competitors is very helpful in gaining many valuable insights like market trends, consumer behaviour shifts and emerging opportunities which are very helpful in making strategies for your business.
2. Identify Strength and Weaknesses: Scrutinizing competitors marketing efforts you can very well identify the areas in which they are exceling and the areas where they are not performing well.
3. Enhance Decision Making: By identifying the strength and weakness of your competitors & strategic insights will help you in your decision making that what we should implement to beat the competition.

What is Competitor Research in Marketing?

Competitive Analysis in Marketing helps to dive deep into the strategies used by our competition. It includes various areas as follows:

1. Market Consolidation: Competitor research helps to know where we stand in front of our competitions through market share of voice.
2. Market Size: By competitor analysis of the top players in the market we can somehow have idea of total addressable market size (TAM) and serviceable addressable market size (SAM).
3. Traffic Source: If we are targeting online then we can very well know the flow of traffic on website (or app) through various channels like direct, referral, organic search, paid search, organic social, paid social, email, marketplaces etc. Understanding the flow of traffic through various channels we can further know on which channel our competition are performing well.
4. Geographical Dynamics: Top Countries or Region can be easily identified through competitive analysis in marketing. We can also know about the top changes in the traffic through different places knowing which we can know which region requires more efforts and where our competition is performing well and by how much.
5. Audience: Through market research we can also have idea of the age and sex of our audience, their socio economics status and education level for which we have to put our marketing efforts in terms of content creation, product building and targeting.
6. Interest & Affinity: Competitive analysis in marketing help us to have the idea of the interest and affinity of our audiences in your industry.

Now you all may have the clear idea about your market size, traffic source, audience demography, their interest and affinity you can clearly know about what all things you can gain through competitive analysis.

How to do a Competitive Analysis?

Now as you know that competitor analysis can help you to gain insights of your target audience and the competition performance in the market. So now you should look for the step-by-step process taken for the competitive analysis:

1. Identify your top 10 competitors.
2. Determine the products and services they are offering.
3. Research about the marketing and sales tactics they are using for their business.
4. Compare your product or services with your competition in terms of price, quality and offers offered by them.
5. Ensure your product or services matches the cost of your competition.
6. Always keep an eye on the new offering made by your top competition in terms of products and services and work on your marketing efforts accordingly.
7. Analyse the content creation strategy used by your competition for promoting the product and services and engaging the audience.
8. Put your content marketing efforts on all the platforms strategically as used by the competition be it youtube, blogging, PRs, offers and more.
9. Put your efforts on the analysing the social media presence of the competition and work accordingly.
10. Perform SWOT analysis after all these things and put your marketing efforts accordingly.

In a Nutshell:

Competitor analysis have not only idea of just know your competitors but also to know how our competitions are proactively putting their marketing efforts to accomplish their business. To outrank your competition digitally, you can hire the best digital marketing agency like Global Digitalogy who can help you to have the largest market share.