Being successful in your business is considered to be an outstanding achievement, but at the same time, sustaining the same is the biggest challenge. There have been many successful entrepreneurs who tasted success initially but eventually turned out to be also-rans.
So, what does it take to be successful in your business? Apart from many other factors, analyzing your competitors’ strengths and weaknesses plays a pivotal role in your firm’s success.
Competitive analysis helps organizations to look at the bigger picture. Small and medium business entrepreneurs sweat it hard to grow their organizations, and at one stage, they are way ahead of their competitors.
But how do they make sure that they are growing better than the competitors? Competitor analysis helps them grow and strengthen their team and double or even triple their revenues shortly.
Now, what exactly is competitive analysis?
Irrespective of the size of businesses, organizations should always plan a complete and extensive competitive analysis report that will help them in the long run.
It helps entrepreneurs to identify their major competitors, their products, sales, and revenue figures. Unfortunately, many organizations forget this important step and are content with just the No. 3 or No. 4 positions. Unless and until an organization looks at competitors and analyses their strengths and weaknesses, they can’t reach the No. 1 position, which is up for grabs for any deserving company.
Meeting industry standards
Organizations should always keep an eye on their competitors. Ignoring competitors is the biggest blunder that an organization cannot afford to make. One should also look at the off-page signals that play an important role in rankings, says WebFx. It also says that it is a good idea to keep an eye on where your site stands as well.
A growing business needs constant care, and thus, understanding the competitive market and competitor analysis enables them to stay in the top position. The company can be a leader in the respective market if it does proper in-depth research on current and potential competitors.
Advantages of preparing competitive analysis
- Healthy competition helps companies grow and helps small and medium business enterprises understand their value proposition and strengths.
- If a competitor has a different product, analyze the reach and make sure you become a first mover in the market by introducing products ahead of your competitors.
- Analyzing competitors’ products or services help organizations speed up their products and introduce them to the market earlier.
- Always have an eye on the feedback or customer reviews of competitors’ products. Since the Internet can help you a great deal in this, always go through reviews of your competitors’ products/services and note them to improve your product and offer customers a better product soon.
Competitors’ sales revenues and goals
A simple advertisement, either on the print or web, or even television, can help you understand the future goals of your competitors. Look at the sales figure, revenues, and goals of your competitors.
This will give you a clear picture of your position in the market. Since all companies -either small or big- are on social media, try to understand their target audience, go through the blogs and analyze their strengths, weaknesses and reach in the social media. Also, you can look at the engagement of various content of your competitors.
Alexa blog lists out 7 steps that guide the organization’s marketing plan. According to them, an organization needs to:
- Identify competitors
- Compare marketing positioning
- Compare site traffic and performance
- Compare keywords
- Compare share of voice
- Compare backlinks
- Compare SEO effectiveness
If your competitors are listed on stock exchanges, they need to provide all information to the exchanges, which can be a greater advantage for you. Analyze their profit and loss account, how they manage debts, and what products they are planning to introduce? All these will keep you ahead in the market.
However small or big a company is, technology plays a pivotal role in the success of an organization. First, understand what technology your competitors are using at present and what they are likely to adopt in the future. Then, be a changemaker, introduce the latest technology first and enjoy a boon of early adopters.
Harvard Business Review says Artificial Intelligence will substantially transform companies within three years. Furthermore, It says AI can support automating business processes, gaining insight through data analysis, and engaging with customers and employees.
Also, find out how competitors are marketing their content. A standard search on the Internet will let you know how they place advertisements, marketing their content and brand. This will be helpful for you to stay ahead of them.
Direct and indirect competitors
For any business, there will be both direct and indirect competitors. Focus only on direct competitors but do not ignore indirect competitors. Direct competitors offer the same products or services that you are offering in the same market.
Still, indirect competitors offer services in different markets, and their focus areas will be different. So always have an eye on indirect competitors, too, as they might fall as your direct competitors in the future. By doing competitive analysis regularly, you will get to know when they are becoming your direct competitors.
Pricing of products or services
Of late, almost all products are available online. E-commerce plays a significant role, and when customers buy the product, they look for several offers, including referral discounts, promo codes, etc. Ensure what competitors have to offer to customers and how they are promoting their products.
Does competitors’ pricing go well with their services? If so, are you pricing it correctly? If you are pricing higher, make sure your sales representatives explain the same to customers. They should explain to customers that your products are slightly high because of your offer’s quality and services.
A company’s biggest strength is its employees, and the company can achieve anything provided they have a dedicated workforce. Firms can easily find out whether their competitors are hiring any top shot or anyone tendered resignation recently. If there are any big shots, you can always make a move to onboard them.
Check out all those on the board and whether the company has placed any advertisements for recruitment. Any job site can give you all the recruitment information. Also, there will be an attrition percentage in the financial results. All this information will help you in preparing a detailed competitive analysis report.
Search Engine Optimisation (SEO)
Everyone now talks about SEO analysis, and this simple thing can reveal a lot of information about your competitors. How they are faring on Google search will provide you with enough information. Keywords also play a pivotal role in finding out what keywords they are using to get maximum attention and visitors. So list down and plan your content accordingly.
If you plan to grow and accelerate your business, the first step you need to do is analyze your competitors. A proper list can serve the purpose. Sometimes, information may be overwhelming, but it will show you a clear path that you need to follow to stay ahead of your competitors.