1930 words. 10 mins read
Your brand exists in a competitive context
The first thing that you need to know that your brand exists and competes in a market.
The market is essentially made up of other brands and substitutes for the category.
Eg. Tooth Powder is a substitute for toothpaste. So when you look at a competition for Toothpaste you may also want to look at substitutes such as tooth powder, medicinal sticks, and home made tooth concoctions.
It therefore makes logical sense to understand what your major competition is doing, both locally and internationally.
- Local competition gives you a good idea of how you stack against them. But that’s often not good enough. If you’re leading in the local market, this can lull you into thinking that you are doing well instead of climbing the next hill.
- International competition gives you answers to where you ought to be and the precise path followed by major international competitors. The reason for this is that marketing is probably more evolved internationally than locally. The next hill that you need to conquer may come from your international competition.
In order to know what your competition is doing you must study them. This is called competitive analysis.
Analyzing an organization’s competitors can help you discover the weaknesses, identify opportunities and the threats from the industrial environment.
Once you determine the strengths and weaknesses of your competitors in your market, you can develop strategies that will provide you with a distinct advantage.
Why bother to analyse competitors?
Some businesses think it’s best to get on with their own plans and ignore the competition.
Yet others track their competition, copy their moves and react quickly to changes.
Competitor analysis has several important roles and contributions in strategic planning. It helps you:
- Understand the disadvantages/advantages relating to competitors
- Understand your competitors’ pasts, present and future strategies
- Provide an informed basis for developing strategies to achieve competitive advantage for your brand
- Forecast the returns that may be made from future investments
Each of these is explained below.
Advantages and Disadvantages
One of the chief reasons for competitive analysis is to understand the strengths and weaknesses of your competition.
Past, Present & Future Strategies
Analyzing your competition helps you formulate effective strategies for your company. Knowing where you stand in the market, vis-a-vis others, warns you early. This helps to take the steps needed to streamline your internal and external communication.
Objective & Profile of Competitors
Effective competitors analysis reveals the objectives of your competitors. This in turn helps you learn the best practices they follow. If the analysis is from diverse competitors the information you glean will be richer.
Forecast of the Returns
Learn from the success and failure of other brands. A competitor analysis establishes the reasons behind failure of unsuccessful companies. This helps you forecast the key assets and skills needed to beat your competition.
Threats Competitors Pose
While analyzing your competition, you identify challenges and threats that your competitors use in the ecosystem. It helps you fortify your company’s strategy.
Here are some reasons why competitor analysis is good for your business
- It helps you create brand awareness as the competition pushes you to find ways to stand out and become a leading authority in your field
- Watching your competition doing something (right or wrong) teaches you to assess your own company’s strengths and weaknesses so that you can create more value and better service for you customers
- Your competition is one of the best ways to become aware of your industry’s market trends. It gives you an opportunity to promote an emerging trend that will excite your buyers about your service.
- Your competition demands you to take an extra step to offer something more. You must constantly prove why customers should choose your company/product or service over another.
- You can learn a lot about your trends, customers, and market by watching the competition. The knowledge and resources may be different and more effective than yours, which gives you an opportunity to learn, manage and adopt the practices that work best for your company.
What you need to know about your competitors
There are many areas where you can examine competitors to inform the strategy for your brand. Most accomplished marketing departments do this by rote.
But our topic is about determining the competitive strategy for online brands.
This is an area that’s still evolving and many marketing departments and digital agencies equally are not fully clued into.
Here you need to know what analysis is possible and how this can inform your brand’s online promotions.
1. Analysis by Observation
By looking at competitor websites, a trained eye can discern the following:
- The Persuasion Framework used, or the absence of it.
Persuasion frameworks will be evident from the copywriting used on the sell pages and landing pages of websites.
- Understand competitor positioning and value propositions.
This helps you build your own unique positioning.
- The Content that creates value for the Customer, or the lack of it, or the dominance of one type of content over others in the customer’s buying journey.
Content should ideally straddle the customer journey. However, unless the marketing department and the agency is clued into this, this won’t happen.
The result is a content skew towards the top of the funnel.
- The precise funnels used for capturing prospects and the techniques for nurturing them.The capture devices on websites are usually tied to email automation systems.
These systems are in turn tied to email sequences that build trust and authority. The emails become the vehicles for sell, and often upsell.
Marketers use email automation and very elaborate funnels [a clear path to sell] for
- Customer onboarding
- Nurturing prospects
- For upselling
- And for keeping the brand on-top-of-mind
2. Analysis using paid tools
By using specialized tools, we can also determine the following
- What technologies do they use on their websites and ergo their marketing maturity with technology
The technologies used on website tell you the marketing maturity of the website.
The key things to look for are analytics, heatmaps, and email and marketing automation systems used by competitors.
- What keywords do they use and for which keywords do they rank
Keywords your competitors rank for help you understand their keyword strategy.
This helps you build your own strategy.
- What are the relative domain ratings for the various websites
The relative domain ratings tell you the authority of other brands vis-avis yours.
This gives you the gaps that you, or they need to cover.
- Where are your competitors getting their backlinks from and how many backlinks do they have? This gives you an opportunity to reverse engineer their best links if that’s possible.
If you know where your competition gets its most authoritative backlinks from, you can reverse engineer this or form your own strategy to beat this.
- What is their top content is and what you can do to counter this on your website
The top content on competitor sites help you determine what your content strategy should be.
- What marketing channels do competitors use and the relative share of these channels.
The marketing channels from where the competition gets its traffic is useful to understand how and where your strategy should be adjusted to either catch up to beat them.
- Do competitors use paid media: Google Ads, FB Ads? What is their investment in Google Ads? What text and display ads do they run and what are the Landing Pages of the ads point towards? What FB Ads do they run?
This information gives you an idea of competitor spends on Google Ads, the types of text ads they use, the Landing Pages they use and more. This is perfect manna for your strategy and how to beat the competition.
- What’s the page speed of the websites?
Page speed is an important factor for ranking. The Desktop and Mobile speed of your website can be improved in many different ways to obtain a higher score.
This in turn affects your ranking and SEO.
All this information can be harnessed for building an informed strategy for your brand.
Where is the problem, if all this competitor analysis can be done?
There are several issues that can crop up with competitive analysis and reporting as described above. This makes it beyond the reach of small businesses and agencies alike.
- It takes experience to do the analysis
Observation skills are honed by knowledge of multiple skills that impact website builds. These range from Usability, UX, Copy Frameworks, Persuasion strategies with underpinnings in psychology, Design skills, Information Architecture considerations and more. Most are not available with agencies.
- The tools cost a lot of $$$$
The tools which provide competitor data are varied and expensive. The data comes from multiple points and has to be harnessed to make sense. This becomes difficult for small businesses, startups, and even smaller digital agencies.
- The data needs deep analytical skills
While the tools exist for a fee, analysis of data to glean insights and translate this into an actionable strategy for your brand, or business, needs special expertise.
- Agencies don’t necessarily tell you the truth
There are many reasons for this. The first is inability. The second is preservation of self-interest preceding the need for honesty and hard truths. The third could be subservience to the client’s needs.
The moot point here is that are your interests well safeguarded? In tough times like these who would serve you better? Someone who listens to you, someone who is experimenting at your cost, or someone who can tell you the truth.
Competitor analysis in the digital realm is spotty and inconsistent right now.
This means that marketers who want to do the right thing and conserve funds have to choose their agencies wisely.
So what is your choice when it comes to competitor analysis, really?
- You need a service provider who has the experience to generate results online at the lowest cost, not just spend money for results that are questionable at best
- You need data-driven strategies not mere opinions to drive your investments
- You need to test continuously and base your future strategies on the test results
An important role of competitor analysis is to give you the ability to set yourself apart.
After having learnt what your competitors are doing, you can build the difference into your business.
Focusing on what makes you different in your marketing and selling the benefits of that difference.
You’re not playing a zero sum game with your competitors – you can both have customers – so it’s better if you’re laser focused on the customers your business is built for.<.em>
Your value proposition can be improved by knowing how you fit, and that’s the importance of competitor analysis. Know the people you’re surrounded by, so you can figure out how to stand out.
You can make the entire process much easier by starting out like this.
Find out what your top competitors are up to.
Contact Pigtail Pundits and book a FREE Consultation session today.
We also offer a very comprehensive competitive analysis with actionable strategies for your brand based on what data and observations. This service is available to you with a one-hour walkthrough for just $199.
We’ve worked with online businesses across different niches for 23+ years now. We’ve helped these businesses flourish and see abundance. Will your business be next?
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