Competitor analysis may seem to be too complicated, unnecessary or unimportant to you. If you run a small brand or creative business, I’m guessing your focus is predominantly on creating, selling and the day-to-day issues that need your attention, right? But having your head buried in the sand, pouring all your energy and focus in managing your own little world is a dangerous place to be. Talking from a personal experience, the consequences of this kind of unintentional ignorance can be dramatic, putting your business at risk.
While you’re consumed by your own “busyness”, the world outside is moving fast. To understand better where you’re at, what you could do next and how your customers and market see your brand, a competitor analysis can be the key to unlocking the answers to these questions. In other words, a competitor analysis can help you understand the game you play in the market better. Without this knowledge, you’re probably wasting your time and money.
The benefits of competitor analysis:
1. It helps you get a better picture of the competition so you can try to emulate their success but also recognise and avoid their failure.
2. It helps you identify gaps in market, new trends and opportunities.
3. It helps you clarify your own USPs and brand story.
4. It helps you define and set goals and measurements against the market/competitors.
Even though a good competitor analysis has to go in depth, it doesn’t mean that it is too complex for you to grasp. Within a few hours you can build a picture you need to drive your business forward.
Knowing who your competitors are, what should go into your competitor analysis?
Product and service analysis: Spend some time understanding your competitors product and service offering. Note any ideas, pricing strategies and sales tactics they use in their communication with customers.
Points to cover:
What is their core product offering (high, medium, low)?
Do they offer bespoke or commission work?
What market do they cater for (high, medium, low)?
What is their pricing strategy? Do they offer seasonal sales or product bundles?
Do they offer different pricing for trade clients?
How do they differentiate themselves in the market from the rest?
What are their product strengths and weaknesses?
Are they scaling down or expanding their product offering?
Do they collaborate on products and/or services?
Visual language and communication analysis: Look out for any clues that could reveal who their customer profile is. Can you perhaps spot certain colours, graphics, visual elements and keywords that help you understand their customer base?
Points to cover:
What is their branding like?
How does their brand communication and brand story align with their core customer base?
What keywords do they use in their communication?
What are they doing well and not so well (imagery, videos, visual storytelling)?
Marketing and sales activities: Through a quick search on the internet you can quickly build up a picture of how your competitors promote their businesses. Check out their social media platforms, sign up to their newsletters, look out for press features and note if they advertise.
Points to cover:
Do they share their brand story through blog/content marketing? What is their content marketing strategy?
Do they advertise – how and where (online and offline)?
What are their main marketing channels?
What are their sales channels and routes to market?
Do they have affiliate / trade programme?
Do they have customer loyalty programme?
Do they have a PR department or do they outsource PR?
Do they organise product launches for press and influencers and/or events for customers?
Do they use collaboration as part of marketing and sales strategies?
Remember, your work is not done once you complete a competitor analysis. It’s the starting point of your strategy plan. Use the insight you’ve gathered to guide you through the next steps you want your business to take.
It’s also important that you update your competitors analysis on a regular basis. It should be an internal document that is constantly evolving, ensuring that it reflects any changes in the market so that you can stay ahead of the game.
Written by Karolina Barnes, STUDIO/ESTILA
Inside our KNOWLEDGE SHARE membership we delve into specific areas of a competitor analysis covering each point in much more detail, giving you the tools, templates and processes which you can apply in your business straightaway. If you want to find out about it more, please click or tap here.
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