What should a competitor analysis include

Having this information can help you create, implement and adjust strategies to improve your company's efforts. It also helps you identify any potential threats your business may face.

Many businesses conduct competitor analysis through impressions, conjectures and intuition. Because of this, blindspots may arise which can lead to an inadequate amount of information to create a well-informed strategy.

To avoid this, companies must conduct a thorough analysis at various stages of business. Related: Analytical Skills: Definitions and Examples. Now that you understand what a competitor analysis is, consider whether or not it's useful for your own business.

Here are some of the benefits this type of analysis provides:. When you understand your competitor and what they're capable of, you're more equipped to use this information to your advantage.

In other words, a thorough analysis can help you build strategies to market your business more effectively. A solid marketing strategy can even raise profits and help you achieve finance or performance goals. Conducting a competitor analysis helps identify any products or services your customers want but don't currently have access to. When you determine these under-served opportunities, it gives you a chance to come up with a solution to fill a customer need.

When you understand your competitor's weaknesses, you can use them to your advantage. For example, if they don't have the resources or capabilities to do XYZ and you do, you can help fill that need and grow in your market. Whether you're planning for the future or making real-time decisions, using a competitor analysis can help you make more strategic decisions and investments to benefit your business.

Before you start a competitor analysis, understand who your competitors are. A competitor refers to any business or company in the same industry that offers a similar product or service. While it's important to identify your existing competitors, you also need to have information regarding your potential competitors that may enter your market in the future.

Here are some simple ways to identify your competitors:. Determine what other companies offer a similar product or service in your market that directly competes with yours. You can also consult with your sales team to identify which competitors often come up throughout the sales process.

Ask your customers which other businesses, products or services they were or are considering. This can help identify competitors you may not have previously realized. To better identify your competitors, review customer conversations via online communities, forums and social media. Since many customers seek advice or recommendations online, this can help you determine who your competitors are. What is their size? What is their percentage of market share? What is their total sales volume?

What is their growth rate? How do they rate on: customer service? How do current customers rate the following features of your business compared to your competition. Rate the following as: fair, good or excellent. Secondary sources include information developed for a specific purpose but subsequently made available for public access and thus alternative uses.

For example, books are secondary sources of information as are articles published in journals. Marketing reports offered for sale to the general public also are considered secondary sources.

Although, they have been created for a purpose other than your current need, they are still excellent sources of information and data. With the ever increasing speed of document identification and retrieval through electronic means, secondary sources are not only an inexpensive source of information but are readily available soon after publication.

Sources of information include: Advertising Not only does advertising copy tell you a competitor's price and other product information, it provides an indication of your competitor's entire promotional program and budget. When reading a competitor's advertisement be sure to note the following: publication, frequency, special offers, product features and benefits highlighted.

If your competitor suddenly places an advertisement in an industry publication that neither of you are currently selling to, it's an indication that they're trying to reach a new market segment. It's also important to notice the design and tone of your competitor's advertisements.

What kind of image do they convey? How does your own image compare? Are their advertisements in color while your own are black-and-white? Even if they're not, a clever advertising campaign can communicate that your competitor is an innovative, fresh company. Sales Brochures Sales brochures provide a wealth of product information. You can learn how your competitor is positioning their product and company and what features and benefits they're using to sell their product.

Try to obtain all new sales brochures and literature your competitor publishes. Significant changes in the content will indicate that new strategies are being employed.

Newspaper and Magazine Articles Articles in newspapers and magazines are a source of information you can use to get an idea of what your competitor is planning for the future, how their organization is run, and what new product information or innovations they have. Journalists may also uncover and reveal unflattering information about your competitor that may prove valuable to you. Be on the lookout for product reviews in magazines; they will reveal a competing product's strengths and weaknesses.

Visit a college or public library. The reference librarian will show you how to find pertinent articles online much more quickly and easily than you'll find them by browsing.

Reference Books and Databases The publications listed in this section are available at most public and college libraries that have business resources. Ask a librarian to help you find them, as many are likely to be online and not listed in the library catalog. State agency publications such as industry directories, and statistics on local industry employment, production, and equipment capabilities.

Data can be selected alphabetically, geographically, by line of business, and officers and directors. Ward's Business Directory of U. Private and Public Companies annual , provides profiles of over , companies small and mid-size companies as well as large corporations, most privately held across the U.

Profiles include assets, gross earnings, revenues, and other pertinent information. Online versions of these products not only make their pertinent statistics easy to find.

They often permit you to download data so you can combine it with other data to produce your own statistics. Annual Reports If your competitor is a publicly-held company, many of its reports to the U.

Annual reports provide financial information, including sales volume, revenue increases, and their total market share. Annual reports from privately-held corporations are sometimes available through friends, relatives, and business acquaintances who own stock in a competitor's company.

Your Sales Force Your sales staff probably has more access to competitive information than anyone else in your organization. Customers often show salespeople sales literature, contracts, price quotes, and other information from competitors. Part of a salesperson's job is to get customers to discuss problems they have with a competitor's product. Customers will also reveal your competition's product benefits, strengths, and customer service programs. Instruct your sales force to ask for copies of any competitive literature if and when that's possible.

Your entire sales staff should keep a record of all competitive information they discover — even if it's just a rumor or gossip. Devote a regular portion of each sales meeting to a discussion of the competition. Other Employees Your employees working in other areas of the company also become exposed to competitive information. They interact with others in their industry area and often learn what your rival is doing or hear gossip and rumors. Make sure your entire staff knows they should share any information concerning the competition immediately.

Former employees of a competitor can provide you with insight on: your competitor's new products, marketing strategies, how-to improve productivity and employ other resources more effectively, and what your competitor's general working environment is like.

Trade Associations Most professional trade associations compile and publish industry statistics and report on industry news and leaders through trade association magazines and newsletters.

Most trade associations also sponsor trade shows and other professional meetings. This is an opportunity to see first-hand what your competition is producing. It also provides the opportunity to discover new players who may soon become your competition. Direct Observation If you own a flower shop, you should visit all of the flower shops in your geographic region. Act as a prospective customer; ask questions. You can learn about their selection and service and compare it to your own.

Do not use an alias or disguise to gather intelligence from competitors. Analysing your competitors is a simple, yet effective marketing tactic to make sure you are keeping up and matching the efforts of others in the industry. If you're looking for assistance in conducting a competitor analysis as part of your wider marketing strategy, Kayo Digital agency in Kent can help.

We offer Kent digital marketing services , as well as SEO, software and app development , website hosting , cutting-edge web design and more. To find out how we can help your business, don't hesitate to get in touch. Alicia is Marketing Executive at Kayo Digital.

A recent graduate in Multimedia Journalism at Canterbury, Alicia has a passion for all things digital and takes care of Kayo's social media marketing as well as writing valuable content and providing SEO performance reports for clients.

Stay up to date with our latest articles and recent project information, enter your details below to subscribe. We promise not to sell your data. Previous Article What is local eCommerce and how can I utilise it? Next Article Four predictions for digital marketing. Please leave your name and email address behind and we will be in touch shortly. If you have a time preference please also select from that field. ME9 8HL. Posted 7 months ago by Alicia Lloyd The Importance of a Competitor Analysis and How to Conduct One If you would like a free basic competitor analysis, or would like to learn more, please contact marketing kayo.

What is the point in doing a competitor analysis? A competitor analysis is important because: It will help you recognise how you can enhance your own business strategy. It will tell you how you can out-do your competitors in these areas to keep your customer attention. Resulting in a competitive edge over others in your sector. The importance of comparing yourself to your competitors Before you can start you need to understand who your competitors are.

Every brand can benefit from regular competitor analysis. By performing a competitor analysis, you'll be able to:. As you can see, learning any of these four components will lead your brand down the path of achievement. To run a complete and effective competitive analysis, use these ten templates, which range in purpose from sales, to marketing, to product strategy.

Download Now. First, you'll need to figure out who you're really competing with so you can compare the data accurately. What works in a business similar to yours may not work for your brand. Direct competitors are businesses that offer a product or service that could pass as a similar substitute for yours, and that operate in your same geographic area.

On the flip side, an indirect competitor provides products that are not the same but could satisfy the same customer need or solve the same problem. When comparing your brand, you should only focus on your direct competitors. This is something many brands get wrong. Let's use an example: Stitch Fix and Fabletics are both subscription-based services that sell clothes on a monthly basis and serve a similar target audience. But as we look deeper, we can see that the actual product clothes in this case are not the same; one brand focuses on stylish everyday outfits while the other is workout-centric attire only.

Yes, these brands satisfy the same need for women having trendy clothes delivered right to their doorstep each month , but they do so with completely different types of clothing, making them indirect competitors. This means Kate Hudson's team at Fabletics would not want to spend their time studying Stitch Fix too closely since their audiences probably vary quite a bit. Even if it's only slightly, this tiny variation is enough to make a big difference.

Keep these brands on your radar since they could shift positions at any time and cross over into the direct competitor zone. Using our example, Stitch Fix could start a workout line, which would certainly change things for Fabletics. This is also one of the reasons why you'll want to routinely run a competitor analysis.

The market can and will shift at any time, and if you're not constantly scoping it out, you won't be aware of these changes until it's too late. At the heart of any business is its product or service, which is what makes this a good place to start. You'll want to analyze your competitor's complete product line and the quality of the products or services they're offering.

These helpful pieces of information will give you an idea of how competitive the sales process is, and what information you need to prepare your sales reps with to compete during the final buy stage. For publicly held companies, you can find annual reports online, but you'll have to do some sleuthing to find this info from privately owned businesses.

You could find some of this information by searching through your CRM and reaching out to those customers who mentioned they were considering your competitor. Find out what made them choose your product or service over others out there. To do this, run a report that shows all prospective deals where there was an identified competitor. If this data is not something you currently record, talk to marketing and sales to implement a system where prospects are questioned about the other companies they are considering.

Essentially, they'll need to ask their leads either through a form field or during a one-on-one sales conversation to identify who their current service providers are, who they've used in the past, and who else they are considering during the buying process.

When a competitor is identified, have your sales team dive deeper by asking why they are considering switching to your product. If you've already lost the deal, be sure to follow up with the prospect to determine why you lost to your competitor.

What services or features attracted the prospect? Was it about price? What's the prospect's impression of your sales process? If they've already made the switch, find out why they made this decision. By asking open-ended questions, you'll have honest feedback about what customers find appealing about your brand and what might be turning customers away. Once you've answered these questions, you can start scoping out your competitor's marketing efforts.

There are a few major factors that go into correctly pricing your product — and one major one is understanding how much your competitors are charging for a similar product or service. If you feel your product offers superior features compared to those of a competitor, you might consider making your product or service more expensive than industry standards.

However, if you do that, you'll want to ensure your sales reps are ready to explain why your product is worth the additional cost. Alternatively, perhaps you feel there's a gap in your industry for affordable products. If that's the case, you might aim to charge less than competitors and appeal to prospects who aren't looking to break the bank for a high-quality product.

Of course, other factors go into correctly pricing a product , but it's critical you stay on top of industry pricing to ensure you're pricing your product in a way that feels reasonable to prospects. Additionally, take a look at any perks your competitors' offer and how you might match those perks to compete. For instance, perhaps your competitors offer a major referral discount or a month-long free trial version.

These perks could be the reason you're losing customers, so if it feels reasonable for your brand, consider where you might match those perks — or provide some unique perks of your own if competitors' don't offer any.

Did you know expensive shipping is the number one reason for cart abandonment? Nowadays, free shipping is a major perk that can attract consumers to choose one brand over another.

If you work in an industry where shipping is a major factor — like ecommerce — you'll want to take a look at competitors' shipping costs and ensure you're meeting if not exceeding those prices.