As the old saying goes, ‘know thy enemy’. Well, okay, your competitors might not be your enemies exactly – but they are fishing in the same pool as you when it comes to business; so it pays to know what they’re doing, and how they’re doing it.
Competitor analysis is an increasingly essential part of any corporate strategy. By gaining information about their products, activities, clients, services, financial status, marketing strategies etc. you are better positioned to see what’s working for them – and what’s not. Once you know this, you can then use it to your advantage.
There are many online tools and companies that will help you gain valuable information about your competitors on the web. Plus, there’s a variety of internet sources that enable you to gather information on your own behalf.
So the first thing you need to decide is whether you’re going to do the digging yourself or hire a professional company to conduct analysis for you.
But, as a brief framework, here are a few of the things you should bear in mind when trying to paint a picture of what your competitors are up to:
A simple Excel worksheet, populated with the right information, can throw up a wealth of information:
* Who: first identify who your main competitors are (and why)
* USP: What’s their unique selling point – what makes them ‘better’ than you?
* What: What products/services are they selling – and how do these differ from yours?
* Strengths: What is your competition good at (is it pricing, marketing, or something else?)
* Weaknesses: Where do they fall short – and how can you capitalise on that?
* Key differentiators: What are they doing that sets them apart from the other competitors in your field?
It’s only by understanding your competition that you can increase your ROI and minimise the cost of ‘trial and error’. So draw up a spreadsheet today and start comparing.