Competitor Analysis: How to Conduct It?

Do you know what competitor analysis is?

Competitor analysis is the process of evaluating and understanding the strengths and weaknesses of your competitors in the market.

By running through this analysis you can get valuable insights about your competitors that can help you make informed business decisions, refine your strategy, and gain a competitive advantage.

But many marketers don't know how to do it, especially when you're just starting out. If you're one of them, this post is for you. In this post, we'll talk about how to conduct it for your business.

So let's get started.

How to Conduct Competitor Analysis

Running a proper competitor analysis involves several steps. We'll look at each of them in detail in the following section.

1. Identify Competitors

The first step to consider when conducting a competitor analysis is to identify your competitors. Now there are two types of competitors.

One is direct and the other is indirect. Direct ​​competitors can be any businesses that offer similar products or services to the same target audience. Indirect businesses are businesses that offer different products or services but compete for the same consumer dollars.

To do this, you'll have to clearly define the industry and market you are operating in. This will help you understand the competitive landscape better.

2. Gather Information

The next step is to gather important information. You can collect this information from various sources like annual reports, websites, press releases, and news articles. Here you'll get information like financial data, product/service information, strategic initiatives, etc.

You can also monitor competitors' social media accounts for customer feedback, engagement, and marketing strategies. Another valuable source can be customer reviews. Look at the reviews on various platforms to understand what customers like or dislike about competitors' products/services.

3. SWOT Analysis

The next step is to conduct a SWOT analysis (Strengths, Weaknesses, Opportunities, Threats) for each competitor and your own business.

This will help you identify areas where competitors excel and where they may be vulnerable. You can then utilize this information to improve your business.

4. Pricing and Product Analysis

Your pricing is one of the most strategic factors to determine your long-term success. So evaluating your competitor's pricing is crucial. Look at different factors like discounts, promotions, and bundled offerings.

Another very important factor to look at is the quality of the products. Compare the features, quality, and uniqueness of competitors' products/services with your own. This will help you identify any gaps or opportunities for improvement.

5. Other Factors

Apart from the above factors, you also need to determine the market share of each competitor. This will help you understand their relative size and influence in the market. Also make sure to analyze your competitors' marketing strategies, messaging, and branding efforts.

You should also identify the channels they use for promotion or how they distribute their products. Identify if they are selling their products online or offline. All of this will help you understand and assess the effectiveness of their campaigns.

Conclusion

Competitor analysis is not a one-day process. It takes time and effort to do a proper study about how your competitors are running the business, who their target audience is, how they are marketing their products etc.

By conducting a thorough competitor analysis, you'll be better equipped to make strategic decisions, refine your offerings, and stay ahead in the market.

But even when you do that you need to constantly monitor your competitors to ensure that you're ahead of them. This is an ongoing process. You have to regularly monitor changes in the competitive landscape and update your analysis accordingly.