Staying One Step Ahead of the Competition

Running a business means keeping your finger on the pulse and an eye on the competition, and Competitor Analysis is the way to go. Taking the time to keep an eye on the industry and what’s going on is key, especially leading up to changes or decisions. Even if you feel like you don’t have any reaaaaaal competition, it never hurts to keep an eye on the market.

What is competitor analysis?

Competitor analysis is researching or looking into competitors in your field to learn more about their products, sales, marketing tactics or really anything about their business. You can then use this information to make future business decisions or adjust your strategy. Competitor analysis is an opportunity to avoid your competitor's mistakes and do it better - so you’re getting all the learnings with none of the failings. 

Chances are you’ve already done competitor analysis to some degree before, although you might not have been aware of it! If you’ve ever had a nosy at someone else’s website, their social channels or even googled their name to see what pops up, you’ve done competitor analysis. But, we’d recommend going a little deeper than this and learning as much as you can - information is power after all!

Why do competitor analysis?

Competitor Analysis is an opportunity to learn from your competitor and do what they’re doing better, gain a better understanding of the market and what your customers are after. Carrying out analysis can lead to discovering new opportunities and creating new revenue streams -  is there a gap you can plug with a new product or service? With these insights in mind, you can plan your next moves and set appropriate goals for your business. 

When is the right time for competitor analysis?

Always! Ok, maybe not always you do have a business to run. But it’s something you want to keep an eye on every few months. If you see a drop in revenue, it’s good to touch base with the market to understand why this is happening and what you need to do. You could have a new competitor on the scene or have an existing competitor relocate or expand their reach. We’d also recommend looking into analysis before business decisions or a new financial year. If you’re looking into launching a new product or service, knowing what other businesses are offering can help you plug a gap they have, identify a new market or you can even learn from their experiences.

What to consider when conducting competitor analysis?

  • Identify your competitors: Right off the bat, who are you up against? Who are your competitors? 
  • Indirect or Direct Competitors: Direct competitors are the ones you want to pay the closest attention to as they're coming directly up against you. Not sure what the difference is? If you’re an electrician that only works on commercial or business buildings then your direct competition would be businesses that do the same with an indirect competitor working on domestic buildings and homes. While what you do is similar, you’re servicing two different markets and different product streams. It’s good to keep tabs on them, but they’re not who you want to pay close attention to unless they make a move into commercial or you want to expand into domestic. 
  • Look at what they do: What products or services do they offer? How do they do it? What can they do better? Could you launch a new product that fills a need? What can you learn from them?
  • Identify your strengths and weaknesses: Knowing what you’re doing well and what you could be doing better sets a benchmark to see how you measure up against the competition or how they measure up against you. Having this benchmark will make it easier to identify their strengths and weaknesses. Pricing, exclusive supply arrangements, patents or licenses are all points that count for you or against you. 
  • Identify their strengths and weaknesses: These could be anything related to business, distribution, awareness, networks, pricing, packaging, reviews, service, reputation, branding, shipping or onboarding processes. Whatever they are, they’re opportunities for you. Use their strengths to set new goals for yourself or take what you’re doing better and use it to market yourself to new and existing customers.

There’s a lot more detail and specifics you can go into too with the more information you have, the more empowered you are when making decisions.