How Can You Conduct Insightful Competitor Analysis? 11 Nov 2019
BerniePortal, a business specializing in HR platforms, suddenly faced some formidable competition. Its direct competitor, Zenefits, raised $500 million in funding. Zenefits also received extensive media coverage due to its massive amount of venture capital.
How could BerniePortal compete? To find out, it studied its competitor. BerniePortal analyzed its rival’s product and compared it to its own. Thanks to its research, BerniePortal realized it had a superior product model.
Armed with that information, BerniePortal leaned into what made its product better. It also made use of Zenefits’ press coverage to educate businesses on the need for an HR platform. Now, BerniePortal and Zenefits are on equal footing in their market. Studying the competition helped BerniePortal stand up to its rival.
Are your rivals as intimidating as BerniePortal’s? Maybe not, but researching your competitors can still help your business thrive. Analyzing your opponents reveals gaps in their businesses that you can use to make your company stand out.
Let’s explore how researching your competitors can help your business. After that, we’ll explain how you can conduct effective competitor analysis.
Can You Learn From Your Competitors’ Mistakes?
“Whether it’s Google or Apple or free software, we’ve got some fantastic competitors and it keeps us on our toes” — Bill Gates.
Your rivals are always testing out new methods and strategies. They’re researching the industry and trying out some great business ideas. If you want to survive, you have to find the innovations your competitors are missing out on.
Examining your competition can reveal opportunities to surpass them. In fact, you may discover that your competition is dropping the ball in some area of business.
For example, you may find out that your competitors aren’t posting industry-relevant content on their social media. Identifying this gap gives you an opening to attract their traffic. How? By posting industry-related content on your social media. Finding areas your rivals have overlooked can make your business stand out.
Dodging the missteps your competition makes also saves your business from costly mistakes. Your competitors’ mistakes may seem small, but one major miscalculation can destroy a business. Vine, a video hosting service, had built up a devoted fan base thanks to its content creators. Yet, there was one major problem. Vine didn’t allow creators to earn revenue from the videos they uploaded.
As a direct result, users started moving to platforms that paid for content. Competitors, like Instagram and YouTube, allowed users to profit from their videos. This difference helped the competition survive while Vine shut down.
Investigating your competition’s failures helps you discover new ideas for your business. But, how do you know which businesses to research? Depending on the size of your business, your competitors could be nearby or halfway across the country. How can you choose the right companies to analyze?
Your Competitors Are Only a Web Search Away
“World trade means competition from anywhere” — Eric Allison, Uber.
There may be numerous companies you can consider competitors. How do you single out your real competition? The following steps can help you narrow down your list of rivals to those you really need to give special attention:
Define the key characteristics of your competitors. For example, they should sell products or services like yours. Once you know what your competitors look like, you can find your business rivals.
Conduct a simple internet search to find potential rivals. Products like Google Trends, SimilarWeb, or Alexa can help you identify companies that rank high for your industry keywords.
Ask your customers what other businesses they considered. You’ll want to include any companies your customers mentioned. Those businesses likely pose a greater risk to your client base.
Once you’ve looked through your search results and customer suggestions, you’ll have a long list of companies.
Thankfully, you don’t have to research each one.
Reduce your list by focusing on the top 10 results. Give these top 10 competitors careful attention in your research. However, you still don’t know what kind of threat they pose.
Now’s the time to look below the surface. What should you look for when analyzing your competition? Let’s find out.
Researching Your Rivals Shows How Your Business Stacks Up
“It is nice to have valid competition; it pushes you to do better” — Gianni Versace.
Competitor analysis takes time, thought, and research into your industry’s trends. The results you get will reveal how your business compares to the competition. How can you conduct competitor research?
Set your research goals. Knowing what you need to accomplish helps you guide your research in the right direction.
Look at your competitor’s product lineup. Do they offer more products than you? Is there more variety in their services?
Check out their website design. Look at your rival’s use of branding, visuals, and content.
Test out their buying process. Is it easy to order things from their website? What happens when you abandon your cart?
Read through the company’s content. You can use analytic tools, like SEMrush, to discover how well their content ranks when it comes to keywords and traffic generation.
Go through their social media. What platforms do they use? How many followers do they have? Which days of the week and times of day do they post content?
Figure out if their methods are working. It’s no use copying your competition if they don’t know what they’re doing. Are they generating traffic? Use analytics and industry best practices to figure out how your rivals are doing.
Once you’ve checked out the competition, you can implement the new ideas you’ve gleaned to improve your business. Your competition doesn’t have to scare you. Researching your rivals reveals the innovations your company is missing out on.
Stop Worrying About the Competition
BerniePortal faced some scary competition when its competitor, Zenefits, received millions in funding. What would the company do? BerniePortal decided to analyze the competition.
Through analysis, BerniePortal discovered that it could stand out by focusing on what made its product different. As a direct result of competitor research, the company survived a crisis.
Even when the competition seems scary, knowing what they’re capable of can highlight any weaknesses. Research your rivals to uncover opportunities to surpass them while avoiding their mistakes. Your rivals may not be as imposing as Zenefits, but doing insightful competitor research can still help you stand up to the competition.
Robyn Kunz is the Chief Compliance Officer at Trusted Employees. She has worked in the background screening industry for over 15 years and holds Advanced Certification in the Fair Credit Reporting Act from the National Association of Professional Background.
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