Posted By Thamsanqa on 02.Feb.2021
The Importance of a Competitor Analysis
Competition analysis is the process of finding out what your competition’s strengths and weaknesses are and how they compare to those of your competition. Competition analysis enables you to identify, analyze and compare your competitors. Your competitive analysis should include information about your competitor’s business model, business strategy, products and services. The inputs to a competitor analysis become more nuanced depending on the industry, nature of the product or service and specific outcomes required. For instance, when evaluating a SaaS based product, elements like ease of use and integration with legacy software become necessary to properly evaluate a software.
A thorough analysis of competitors would also include assumptions your competitors have made about their own competitors and whether your assessment is correct. The results of your competitors’ analysis should be able to predict their behavior and even influence it to your advantage.
A detailed analysis of competitors can help you communicate your ideas to others and distinguish them from those of your competitors. Write down the analysis of your competitors and list the competitors you want to evaluate and research. Following this, you will need to develop key metrics to benchmark their performance or find ways to improve your competitiveness. Some general metrics may include revenue, site traffic, unique marketing methods, number for locations and geographical spread, differentiation, unique selling points etc.
By performing competition analysis you can gain a better understanding and deeper insight into your competition. By looking at your competitors’ SWOTs, we can analyze their strengths and weaknesses in more detail. We use SWOT analyses to examine the performance of our competitors at all levels of their industry, from the top to the bottom. To assess their performance at the highest competitive level and overall performance in the industry as a whole, I conduct a simplified swap analysis of all at the same time. An additional key framework to include in your SWOT is Porter’s five forces model.
If you continue to analyze competitors over time and iterate the process accordingly, you will discover other valuable attributes/metrics that are relevant to your industry and market. With this tool you can find market-related statistics that can be included in the analysis of your competitors. Be sure to check the market for each competitor in the analysis and what should be considered in the table
When you’re ready, you can take the analysis a step further by using the “Listen to Competitive Analysis” theme to find and see trends in your competitors’ data. When it matters, integrate demographic analyses into your competitive analysis to implement marketing strategies. Finally, you should implement a marketing strategy that secures and strengthens your position in the market. Competitor analysis can create a precise value proposition that will shape your overall marketing strategy.