When was the last time you ran a competitive analysis for your brand?
If you’re not sure, or if the last “analysis” you ran was a quick perusal of a competitor’s website and social media presence, you’re likely missing out on important intelligence that could help your brand grow.
To help you get started with competitive analysis the right way, we’re breaking down everything you’ll want to look for below.
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. But before you get too excited to start, we need to nail down a few important basics.
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 is one that 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 really 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 anytime, and if you’re not constantly scoping it out, you won’t be aware of these changes until it’s too late.
Once you identify your true competition, you’ll need to determine what metrics you’ll be comparing across the board.
There are three specific categories to focus on: business (the products), sales, and marketing.
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:
Running a sales analysis of your competitors can be a bit tricky.
You’ll want to track down the answers to questions such as:
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 the with 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.
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:
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 there.
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:
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.
To gauge how engaging your competitor’s content is to their readers, you’ll need to see how their target audience responds to what they’re posting.
Check the average number of comments, shares, and likes on your competitor’s content and find out if:
From engagement, you’ll move right along to your competitor’s content promotion strategy.
The following questions can also help you prioritize and focus on what to pay attention to:
The last area you’ll want to evaluate when it comes to marketing is your competitor’s social media presence and engagement rates.
How does your competition drive engagement with their brand through social media? Do you see social sharing buttons with each article? Does your competitor have links to their social media channels in the header, footer, or somewhere else? Are these clearly visible? Do they use calls-to-action with these buttons?
If your competitors are using a social network that you may not be on, it’s worth learning more about how that platform may be able to help your business, too. To determine if a new social media platform is worth your time, check your competitor’s engagement rates on those sites. First, visit the following sites to see if your competition has an account on these platforms:
Then, take note of the following quantitative items from each platform:
With the same critical eye you used to gauge your competition’s content marketing strategy, take a fine-toothed comb to analyze their social media strategy.
What kind of content are they posting? Are they more focused on driving people to landing pages, resulting in new leads? Or are they posting visual content to promote engagement and brand awareness?
How much of this content is original? Do they share curated content from other sources? Are these sources regular contributors? What is the overall tone of the content?
How does your competition interact with their followers? How frequently do their followers interact with their content?
After you collect this data, generate an overall grade for the quality of your competitor’s content. This will help you compare the rest of your competitors using a similar grading scale.
As you evaluate each component in your competitor analysis (business, sales, and marketing), get into the habit of performing a simplified SWOT analysis at the same time.
This means you’ll take note of your competitor’s strengths, weaknesses, opportunities, and threats any time you assess an overall grade.
Some questions to get you started include:
You’ll be able to compare their weaknesses against your strengths and vice versa. By doing this, you can better position your company, and you’ll start to uncover areas for improvement within your own brand.
Before you accurately compare your competition, you need to establish a baseline. This also helps when it comes time to perform a SWOT analysis.
Take an objective look at your business, sales, and marketing e orts through the same metrics you use to evaluate your competition.
Record this information just like you would with a competitor and use this as your baseline to compare across the board.
Ready to get started with the full ebook and template? Click here to access the complete Competitive Analysis Kit.