What's a Competitive Analysis
Clarke Ricks
School of Business, Liberty University
BUSI 690: Policy and Strategy in Global Competition
Dr. Hicks
April 6, 2022
What's a Competitive Analysis
A competitive analysis is a strategy that involves researching major competitors to gain
insight into their products, sales, and marketing tactics. Implementing stronger business
strategies, warding off competitors, and capturing market share are just a few benefits of
conducting a competitive market analysis.
A competitive analysis can help you learn the ins and outs of how your competition
works, and identify potential opportunities where you can out-perform them.
It also enables you to stay atop of industry trends and ensure your product is
consistently meeting — and exceeding — industry standards.
Let's dive into a few more benefits of conducting competitive analyses:
Helps you identify your product's unique value proposition and what makes your
product different from the competitors', which can inform future marketing efforts.
Enables you to identify what your competitor is doing right. This information is
critical for staying relevant and ensuring both your product and your marketing campaigns
are outperforming industry standards.
Tells you where your competitors are falling short — which helps you identify areas
of opportunities in the marketplace, and test out new, unique marketing strategies they
haven't taken advantage of.
Learn through customer reviews what's missing in a competitor's product, and
consider how you might add features to your own product to meet those needs.
Provides you with a benchmark against which you can measure your growth.
What is competitive market research?
Competitive market research focuses on finding and comparing key market metrics that
help identify differences between your products and services and those of your competitors.
Comprehensive market research helps establish the foundation for an effective sales
and marketing strategy that helps your company stand out from the crowd.
Next, let's dive into how you can conduct aCompetitive Analysis in Marketing
Every brand can benefit from regular competitor analysis. By performing a competitor
analysis, you'll be able to:
Identify gaps in the market
Develop new products and services
Uncover market trends
Market and sell more effectively
As you can see, learning any of these four components will lead your brand down the
path of achievement.
Next, let's dive into some steps you can take to conduct a comprehensive competitive
analysis.
How to do a Competitive Analysis
1. Determine who your competitors are.
2. Determine what products your competitors offer.
3. Research your competitors' sales tactics and results.
4. Take a look at your competitors' pricing, as well as any perks they offer.
5. Ensure you're meeting competitive shipping costs.
6. Analyze how your competitors market their products.
7. Take note of your competition's content strategy.
8. Learn what technology stack your competitors' use.
9. Analyze the level of engagement on your competitors' content.
10. Observe how they promote marketing content.
11. Look at their social media presence, strategies, and go-to platforms.
12. Perform a SWOT Analysis to learn their strengths, weaknesses, opportunities,
and threats.
competitive analysis for your own company. 1. Determine who your competitors are.
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.
So how can you do this?
Divide your “competitors” into two categories: direct and indirect.
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.
It seems simple enough on paper, but these two terms are often misused.
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.
Now, this doesn't mean you should toss your indirect competitors out the window
completely.
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.
2. Determine what products your competitors offer.
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.
You should also take note of their pricing and any discounts they're offering customers.
Some questions to consider include:
Are they a low-cost or high-cost provider?
Are they working mainly on volume sales or one-off purchases?
What is their market share?
What are the characteristics and needs of their ideal customers?
Are they using different pricing strategies for online purchases versus brick and
mortar?
How does the company differentiate itself from its competitors?
How do they distribute their products/services?
3. Research your competitors' sales tactics and results.
Running a sales analysis of your competitors can be a bit tricky.
You'll want to track down the answers to questions such as:
What does the sales process look like?
What channels are they selling through?
Do they have multiple locations and how does this give them an advantage?
Are they expanding? Scaling down?
Do they have partner reselling programs?
What are their customers' reasons for not buying? For ending their relationship with
the company?
What are their revenues each year? What about total sales volume?
Do they regularly discount their products or services?
How involved is a salesperson in the process?
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.
4. Take a look at your competitors' pricing, as well as any perks they offer.
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.
5. Ensure you're meeting competitive shipping costs.
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.
If most of your competitors' offer free shipping, you'll want to look into the option for
your own company. If free shipping isn't a practical option for your business, consider how
you might differentiate in other ways — including loyalty programs, holiday discounts, or
giveaways on social media.
6. Analyze how your competitors market their products.
Analyzing your competitor's website is the fastest way to gauge their marketing efforts.
Take note of any of the following items and copy down the specific URL for future reference:
Do they have a blog?
Are they creating whitepapers or ebooks?
Do they post videos or webinars?
Do they have a podcast?
Are they using static visual content such as infographics and cartoons?
What about slide decks?
Do they have a FAQs section?
Are there featured articles?
Do you see press releases?
Do they have a media kit?
What about case studies?
Do they publish buying guides and data sheets?
What online and offline advertising campaigns are they running?
7. Take note of your competition's content strategy.
Then, take a look at the quantity of these items. Do they have several hundred blog
posts or a small handful? Are there five white papers and just one ebook?
Next, determine the frequency of these content assets. Are they publishing something
new each week or once a month? How often does a new ebook or case study come out?
Chances are if you come across a robust archive of content, your competitor has been
publishing regularly. Depending on the topics they're discussing, this content may help you
hone in on their lead-generating strategies.
From there, you should move on to evaluating the quality of their content. After all, if
the quality is lacking, it won't matter how often they post since their target audience won't
find much value in it.
Choose a small handful of samples to review instead of tackling every single piece to
make the process more manageable.
Your sampler should include content pieces covering a variety of topics so you'll have a
fairly complete picture of what your competitor shares with their target audience.
When analyzing your competitor's content, consider the following questions:
How accurate is their content?
Are spelling or grammar errors present?
How in-depth does their content go? (Is it at the introductory level that just
scratches the surface or does it include more advanced topics with high-level ideas?)
What tone do they use?
Is the content structured for readability? (Are they using bullet points, bold
headings, and numbered lists?)
Is their content free and available to anyone or do their readers need to opt-in?
Who is writing their content? (In-house team? One person? Multiple contributors?)
Is there a visible byline or bio attached to their articles?
As you continue to scan the content, pay attention to the photos and imagery your
competitors are using.
Do you quickly scroll past generic stock photos or are you impressed by custom
illustrations and images? If they're using stock photos, do they at least have overlays of text
quotes or calls-to-action that are specific to their business?
If their photos are custom, are they sourced from outside graphic professionals or do
they appear to be done in-house?
When you have a solid understanding of your competitor's content marketing strategy,
it's time to find out if it's truly working for them.
8. Learn what technology stack your competitors' use.
Understanding what types of technology your competitors' use can be critical for
helping your own company reduce friction and increase momentum within your
organization.
For instance, perhaps you've seen positive reviews about a competitor's customer
service — as you're conducting research, you learn the customer uses powerful customer
service software you haven't been taking advantage of. This information should arm you
with the opportunity to outperform your competitors' processes.
To figure out which software your competitors' use, type the company's URL into Built
With, an effective tool for unveiling what technology your competitors' site runs on, along
with third-party plugins ranging from analytics systems to CRMs.
Alternatively, you might consider looking at competitors' job listings, particularly for
engineer or web developer roles. The job listing will likely mention which tools a candidate
needs to be familiar with — a creative way
