Competitor analysis is useful to understand where we are compared to our competitors and then develop a strategy that allows us to remedy our weaknesses and push on our strengths.
The main purpose is to show the differences between your business and those of your competitors.
Competitor analysis turns out to be a useful exercise to identify your strengths and weaknesses and thus understand the threats and opportunities that the market presents to you.
We can carry out a competitor analysis through three simple steps:
Competitor identification
For a good competitor analysis, the first thing to do is to identify which companies specialize in the production or sale of the same goods or services as you.
This is a trivial operation at first glance but one that must be done methodically without leaving anything to chance. In addition to checking the price and the products services, you need to consider whether the market is the same in terms of target customers.
In addition, you must not only consider direct customers but also indirect customers who offer a product or service that is not exactly similar to yours, but a substitute and that are aimed at your own potential target customers.
When analyzing competitors, also consider those companies that have the same customers as a target that could acquire your market share or even snatch some of your customers in the competitive war.
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Global evaluation of competitors on products/services and marketing
It is a question of evaluating the products and services and marketing strategies.
In the first case, it is enough to buy the products, to check price, quality of the product/service, mode of delivery, sales channels used, assistance service, etc
In this way you will be able to make all the useful considerations to understand the difference between your product/service and that of competitors.
In the second case, you need to understand what marketing techniques you use to communicate with potential customers you have in common.
For example, you should understand if they use testimonials, ambassadors, influencers, if they implement outbound or inbound marketing strategies. if you have obtained awards and recognitions, if you hold live events or live webinars, what is your presence on social networks, etc.
By evaluating the type of marketing adopted by your competitors, you will be able to understand how to improve your communication and differentiate it.
Choose a competitive strategy
If you have carried out an effective competitor analysis, at this point you should be clear about the differences and similarities between your business and those of your competitors and you will be clear about the threats and opportunities.
At the end of the analysis, you will have to establish an appropriate competitive strategy that allows you to defend your customers and acquire new ones.
The best strategy is to tell your target audience why they should choose you over the competition and what your distinguishing elements are.
The main competitive strategies to consider are the following:
Cost Leadership: the goal is to be able to obtain costs on raw materials, significantly lower than competitors by exploiting economies of scale, optimizing production capacity through innovative technologies and the talent of your team;
Differentiation: offer a product or service that clearly distinguishes itself from that of other companies thanks to patents, proprietary technologies;
Offer value: The goal is to offer a higher perceived value of the product or service than that of competitors, also thanks to brand and brand positioning.
