To compete successfully you have to know who you are up against! Competitor Analysis is the in depth analysis on your major competitors, or new players entering your target markets – such as their structure, products/services, strategy, strengths and weaknesses, opportunities and threats – enables you to really focus on targeting resources where they will have the most impact.
Analysis of the competitive landscape will help you to:
- understand competitors’ objectives and strategy and develop your own accordingly
- develop realistic sales targets through understanding the scale of competitors’ operations and revenue
- identify relative market positions
- identify each competitor’s market share
- identify the split of competitors by product
- conduct a gap analysis on product features
- implement product or service improvements to counter strengths/weaknesses and innovations in their product portfolio
- position your products/services appropriately
- understand the distribution strategies of your competitors and optimize your own
- offer competitive pricing discounts and payment terms
- develop a marketing communications strategy with messages that resonate effectively with your target market and counteract your competitors’ messages
- strengthen your products/services and marketing strategy according to how your competitors and their products are perceived by customers
- identify new product development and competitive product road maps
- develop sales guides highlighting sales “kill points”, i.e. points designed to counter specific competitor offerings and communications
- understand competitor customer satisfaction levels
- conduct lost bid analysis
- define research and development investment.
Competitor analysis is a large, complex and specialist study; decide first what your needs are, and therefore which avenues you need to explore, and plan your research in detail ensuring you apply the appropriate technique or methodology to gain the best results. Approaching various sources will be necessary – competitors’ employees and customers, channel partners and maybe former employees – make sure you have the expertise available to conduct this research to maximize the information gathered and ensure you are aware of ethical and legal considerations.
Effectively completed, competitor analysis is technically challenging, complicated and resource-hungry work that is best left to experts that specialize in the competitor intelligence and analysis field.