Keeping an eye on your competitors is essential, but when was the last time you actually completed a formal review by way of a ‘competitor analysis’?
A competitive analysis is an on-going process, enabling you to identify your competitors and evaluate their respective strengths and weaknesses.
By knowing your competitors and their activities, you will better understand what products or services you should offer. Understanding their offerings will also help to maintain competitive pricing, and keep on top of relevant industry developments.
The level of detail you glean about your competitors depends on the level of detail you go into.
Do your research
Look at your competitors’ websites to find out more about their services, products and marketing strategies. Facebook, Twitter or LinkedIn profiles are also good ways of finding out more about the businesses. You can even consider signing up to the free Google Alert service, which will deliver the latest news on your competitors to you by email.
Read their product literature and brochures and read industry trade publications to find out more about their approach to market.
Talk to your customers. Encourage your client facing teams to feed information back about what they are saying in terms of satisfaction in your own service and products, as well as those provided by your competitors.
Know your position
When considering where you stand alongside your competitors, look hard at how your business operates. Undertake a strengths/weaknesses opportunities/threats analysis of your business and rank your company in the same categories that you ranked your competitors.
Here are some key tips:
- List four to five insights or key success factors down the left of your page, then weight them out of 100
- List your business now in a column along the top followed by a further three or four competitors
- Now score your business 50 per cent of the weighting as a benchmark, and then score each competitor against the various insights or key success factors
This will not only give you a good indication of where you need to improve, but it will also highlight areas where you can differentiate your business from the competition.
Act on the information
A thorough analysis of your competitors will enable you to more readily identify characteristics within your business that you should take advantage of to gain more customers, as well as pinpoint areas for improvement, or new channels to market which you should be considering. The key now is to use this information to develop effective competitive strategies.