Have you been analyzing the competition? What sets you apart from your competitors? What makes you better than them? What do they do right that you’re missing the mark on? Why would customers select your competitors over you? These are all really good questions you should be asking yourself. But the key is, you can’t answer them unless you’ve completed some competitive analysis. This is a process that should be conducted at least once or twice per year.
Looking at what you competitors are doing right and wrong, will give you insight into how you can improve your processes in order to grow your business. The biggest complaint I get from clients when we talk about competitive analysis, is how hard the process is. But it doesn’t have to be. In this blog post, I’m going to give you six simple steps you can use to analyze the competition and gain some great insights. Let’s get started.
Set Your Goals
The process begins with goal setting. Think carefully about which decisions your competitive research will impact. Pricing? Product design? Marketing efforts? How will the information your obtain determine what you do in your business? If you know your goals upfront, that knowledge will help you structure the research to meet those goals.
It’s also a good idea to set a hypothesis. This makes the process a little bit more fun. You can make some assumptions around what your competition is doing and how well those tasks are working for them. You may assume your competitor posts to social media more than you. But find out later that, although they post more than you, they aren’t receiving the level of engagement you receive. So think about it, what are some goals and hypothesis’ you can draw before we begin this process?
Identify Your Competition
The next step is to identify your competition. You will have two types of competitor. The first type are direct competitors. These are businesses that sell the same kind of product or service you provide. They are in direct competition with you. Customers have a choice between the two of you. Customers may decide to take an online course from your competitor over you, or vice versa.
The second type of competitor is an indirect competitor. An indirect competitor is a competitor who sells an alternative to your products or services. For example, you may sell motorized scooters, but your indirect competitor sells motorized skateboards. They aren’t the same product, but your customers have a choice of how and where they want to spend their money.
In order to identify your competition, you will want to begin with a broad search online. Search for the products and services you sell and see what websites appear in the search results. Also, search for keywords using your region, especially if you sell a product locally, such as baked goods or offer picnic services. Another way you can find your competitors is to ask your customers who else they considered besides your company.
Compare Marketing Positioning
Now let’s look at your competitors and how they are positioned in the market, next to you. You will want to collect the same data points for yourself, as you collect for your competitors. The best way to do this is to conduct a SWOT analysis for each competitor.
What are they strengths? Do they offer 24/7 chat support on their website? What are they weaknesses? Do they have a 3-week delivery timeframe? What are some opportunities for them? Do they have a patent on a piece of equipment? And what are their threats? Does their app use old code that’s super buggy?
The best way to conduct a SWOT analysis for multiple competitors is through the use of a competitive matrix. A competitive matrix is a chart that plots a brand’s strengths, weaknesses, feature offerings, and other qualities.
Compare Site Traffic and Social Media Performance
This is the time where you have to do a bit more research. You can use tools such as SEMRUSH or Alexa to see how much traffic a competitor is getting to their website. The metrics you want to focus on are: monthly unique visitors, number of pageviews, traffic sources, bounce rates, time on site, pageviews per user, followers and engagement rate.
This type of information compared with your own metrics will give you a better idea of where they (and you) fall in the market. It’s at this point you can begin to plot competitors on a plot chart. It’s at this point where the vision of your competitive field begins to take shape.
The next step is to conduct a keyword analysis, in order to see what keywords your competitors are ranking for and what type of ranking they have. Do they make use of rich snippets, where you don’t? Do you use content marketing in a way that’s focusing on keywords you didn’t even know customers were using.
Begin jotting down the keywords your competitors use, that you don’t From this base list of keywords, you should be able to find some long-tail keywords that are easier for your to rank for. You can use tools like Moz and SEMRUSH for this type of research.
Ok, this is the last bit of research. Using tools like Moz and SEMRUSH, you can identify the number of quality of backlinks to your competitor’s websites. You want to look specifically for places where you can also be linked from. This may include directories, news publications, or even other people’s blogs.
So that’s it, the seven steps to conducting competitor analysis. While it’s not an overly complicated process, it can be very time consuming. You may want to reach out to a professional to assist you with this work. This will free up your time to stay in your zone of genius.