Competitor analysis is one of the most valuable resources a business can have. This type of study can be carried out after creating a company or in the or service.
For millions of businesses, this analysis is based on the constant observation of the profiles of their competition in the . For others, it is a more detailed study from different data sources.
In either case, it is important to keep in mind that knowing in depth what businesses similar to yours do can help you position your product and your content can become a magnet for customers. .
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In addition, competitive analysis It will allow you to stand out in the market, generating great profits and progressively scaling your business.
To help you focus on your prospects, and that customers recognize you and choose your brand, we offer you a practical guide on how to carry out an effective analysis of the competition. Do not miss it!
What do we call competition?
Before getting into the matter, you need to know what exactly the competition is. This term is based on one or more businesses that create and similar in the same market.
Small and medium-sized businesses, mainly, carry out studies of their competition to find out who your direct competitors are.
Types of competitors
One of the frequent concerns throughout the career, whether of consolidated entrepreneurs or of is to stand out from the competition.
If this is your case, don’t worry! What you should know is that if you analyze your competitors as part of your work routine, you will be able to understand their behavior. Therefore, you will know how to predict their movements.
This will help you focus your strategy and develop appropriate techniques to operate your internal and external business processes in a more timely and intelligent manner.
Next, we are going to show you the types of competition that exist:
direct competitors
Direct competition is made up of those companies or people that offer products or services similar to yours. Therefore, we recommend that you always pay attention to their movements.
Thus, you will be able to keep acting competitively in your specific and know what their strengths and weaknesses are.
indirect competitors
They are those businesses that offer services or products that replace the ones you sell. Although it is not a direct competition, you should watch them to monitor what percentage of your he is attracted by his alternatives.
real competitors
They are all the companies that we can easily identify, since they are currently in our market, they are characterized by producing products or services that are very similar to ours and that satisfy the same need.
Potential competitors
They are all the companies that are in your competitive market environment. This class of competitors is the most dangerous, because you don’t necessarily know them and you don’t have much information about how they act in the market.
What is competitive analysis and what is it for?
The analysis of the competition is part of and it is based mainly on an exhaustive and constant study of the capacities, strategies, resources, advantages, strengths, weaknesses and other characteristics of the competing businesses.
This study is crucial when creating a company, as it helps you acquire the necessary information about the competition and the market you want to enter.
In addition, it allows you to have a basis for making decisions or formulating appropriate strategies, which will be very useful for the growth of your business. And they can even be used to improve your procedures, using the or others .
Carry out a study of your competition in the market It will help you always update. Consequently, you will take advantage of their weaknesses and you will know what their virtues are to improve your product or service.
How to do a competitor analysis? Step by Step
Now that you know what competitor analysis is, we are going to explain, step by step, how to do it.
The first thing you should know is that you can do it even without leaving your chair. You just need to know a few steps that will allow you to achieve your goals and the success of your business. Let’s see them!
Step 1: Identify your main competitors
To begin with, you need to know what the who work in the same sector as you. The vast majority of the time, businesses do not know all of them, because there are many.
You need to make a list of all your direct competitors. To do this, we suggest that you include relevant information about them, such as their its business image, the values that each of its brands represents, etc.
Step 2: Compare the content of your competition
Subsequently, you must analyze the content of each of these businesses, to verify if they are really similar to yours. To achieve this, you can create a list of 20 companies to define which are the most outstanding.
Step 3: Analyze the data with specialized tools
After you have made an initial assessment, you can carry out a second phase of analysis with a specialized tool, such as software or a .
This will allow you to evaluate different technical elements, such as the scope of its content, its interaction with consumers or even its reputation in the internet. .
Step 4: Compare your competitive advantages to create a strategy
Now, you need to make a global comparison of the data you collected from each competitor with respect to your business.
Thus, you will be able to define what type of strategy you should execute to improve the performance of your business and stand out in the market.
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Step 5 – Study Your SEO Strategy
Another essential step in your study is to have a good strategy which can be instrumental in evaluating and comparing your business’s place in search engine rankings.
Identify the is of the utmost importance. You can see which ones your competition uses the most and create content with them. But, hey! It is not about plagiarism, your content must be different.
Step 6: Keep an eye on your competitors
Just like you, your competitors also seek to improve their strategies and they also carry out analyzes of their competitors, so it is very likely that they know of some actions that you are undertaking or are going to undertake.
Based on this information, they readjust their plans and strategies, for this reason it is very important to be very attentive to any change in the strategies of your competitors and even to changes in your own actions, since these could cause changes in decisions. of your competition.
Examples of competitive analysis
Well, now that you have everything ready to start analyzing your competition, we want to show you some examples. so you better understand how to get the best results . Keep reading!
Market analysis
It is based on the processes of capturing and processing all the information flows on the characteristics of a given commercial sector. Some of the variables you should consider are:
- Supply and demand indices.
- Market share size.
- Business trends and dynamics.
- Neglected niches or segments.
- Legislation in the geographical area of interest.
- Industry regulations.
- Sociocultural contexts.
Comparison of competitiveness factors
This It consists of comparing various benefits at a competitive level for a better positioning. To achieve this, you must consider the following aspects:
- Prices of products or services. Presentation formats (containers, labels, forms, etc.) or provision (in the cloud, on premiseby subscription, among others).
- Experiences in the interactions during each stage of the journey of the .
- Degrees of personalization in marketing campaigns or in the processes of .
- Technologies implemented to immediately increase purchasing processes.
Identification of competitors
This type of competitive analysis is based on identifying competitors. To achieve this, you must verify if your competition is direct or indirect.
We know that sometimes it is not so easy to distinguish your main competitors. Therefore, we suggest that you carry out your analysis very carefully.
An example of direct competition is that between Coca-Cola and Pepsi. Both sell the same product to the same audience: people who consume soft drinks.
Its indirect competitors would be the natural juice brands, whose product is similar but serves a potentially different audience.
Common mistakes when performing competitor analysis
When conducting a competitive analysis some mistakes are usually made. To help you avoid them, we are going to explain what they are.
1. Not knowing how to identify your true competition
This is one of the most recurrent and most serious errors that occur in companies. It is extremely important that you take into account which are your most dangerous competitors and prioritize their importance within your analysis.
It is likely that you have many competitors, if we count the real, indirect and potential competitors, for this reason it is necessary that you focus your efforts only on the most dangerous ones, while observing the actions of the most distant ones.
2. Underestimating the competition
It is important that you know that, regardless of the size of your competition, you must analyze it in the same way: with attention to detail and depth.
It is very difficult to know when a competitor that you consider small can grow abruptly, for this reason it is necessary to monitor even the actions of smaller competitors.
3. Forget indirect competitors
Another common mistake when conducting a competitor analysis is to focus on direct competition. The hint should also be analyzed, since it can bring you information that will help you position your business in the market.
4. Overconfidence
yesi do not dedicate effort and dedication to the analysis of your competition and you conform to your intuitions, you are very likely to make mistakes. Therefore, we recommend that if you are taking your first steps in the world of carry out deep and detailed analyzes of all the relevant factors for the growth of your business.
Start analyzing your competition today
As you have seen throughout this post, identifying and analyzing your competition is essential to consolidate yourself in the market.
You should keep in mind that this requires a lot of research and study time. In addition, it is essential that you have the necessary tools to carry out an accurate evaluation. In this sense, it can be very useful to you.
With these ideas and strategies you will be able to carry out an analysis of professional competence that will allow you to control the scope of your product or service in the…
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