Andrew Whitworth once said, "If you're a true warrior, competition doesn't scare you. It makes you better." If you own a company, chances are you have competition and that can be scary.
But instead of pretending that your competition doesn't exist, you need to know them inside and out. When you know what your competitors are doing, your company can beat them at their own game.
Although, just knowing what your competitors offer and how much they charge isn't enough. You've got to dig into the strategies they're using that position them at the top of the pack and what they're doing that could threaten your chances of success.
A great way to learn more about your competition is by creating a competitive analysis. A competitive analysis is an assessment of your competitors' strengths and weaknesses, and it provides both offensive and defensive strategic context to identify opportunities and threats. But how do you create one?
It's not as difficult as it sounds. With just a little bit of research, you can learn everything you need to know about your competition. Here's how to create a competitive analysis like a pro.
1. Identify your top competitors.
The obvious first step to creating a competitive analysis is identifying who your top competitors are. Don't go crazy listing every possible company that's in your industry; keep it succinct and choose your top 10 competitors. You might know of a couple local business rivals in your area, but if you're not sure about who your other competitors are, do a quick Google search to find out. Enter your keywords into the search bar and research the companies that show up on the first couple of pages.
When identifying competitors, consider companies that are similar in size to you. Write a short explanation on why you think each company is a top competitor and include basic company information about each one along with observations about notable interactions you've had with them previously.
2. Determine who their target audience is.
To better understand your competitors, you need to determine who their target audience is, namely, who they're trying to attract and what type of people are loyal customers of their business. You can pinpoint out who your competition is targeting by taking a look at their advertisements and where they advertise as well as their blog and website. Look for clues about who their target audience is by asking questions like:
- Do their advertisements appear to be gendered? Are they clearly targeting women more than men for instance?
- Are they targeting low, middle or high-income customers?
- What are the main messages of their marketing campaigns? Are they referring to a specific problem their customers have?
By identifying who the target audience is for your top competitors, you can define what your own target audience is if you haven't yet or potentially expand your target audience to reach just as many consumers as your competition.
3. Analyze their content and online presence.
Next, take a look at your competitors' content and online presence. By analyzing the type of content they publish as well as their presence on social media, you can determine the strategies they use that give them success and what you can do to outperform them.
Do a little digging and find out what type of content your competitors create. Do they post long-form informative blog posts or tutorials multiple times a week? Do they focus more on video content? How often do they post on social media and what type of images do they share there?
4. Note their strengths and weaknesses.
Last, you need to note the strengths and weaknesses of your competition. This step acts as a way to summarize all of the information you've discovered in your research and will help you easily determine what aspects of business your competitors are excelling at and what you can do to reach their level, as well as the opportunities to outperform them.
Another clever way to identify a company's strengths and weaknesses is to watch what people are saying about them online. Check out customer reviews. Read good reviews and bad reviews so you can find out what consumers are saying and use that to your advantage.
Now that you know how to create a competitive analysis like a pro, you can start working toward making your company the No. 1 choice in the eyes of consumers. When you know how you stack up against the competition, you can make strategic improvements to your business that will keep you one step ahead at all times.