Let’s face it, a “how to do competitive analysis” article is not getting anyone leaping out of their seat with excitement is it?
There may be some people out there who wake up in the morning absolutely pumped to research the life out of their competitors.
But for most of us it feels like a task reserved for the long finger or the “someday” list.
Here’s the thing though… For anyone who wants to build a successful brand, it’s a non-negotiable and something you simply must do.
Skip this step and the brand you build will lack a key ingredient of any successful brand…. Relevancy.
But it’s not all bad.
When you have a framework in place and you know the steps to follow, painting a picture of your market landscape becomes simple.
If you’re still not motivated to roll up your sleeves then know this… There is gold to be found in an effective competitive analysis.
When you have a clear picture of the choices your audience has and how they feel about those choices, patterns begin to appear.
These patterns represent gaps which are the birthplace of extraordinary differentiators and iconic brands.
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What Is Competitive Analysis?
With the number of businesses in the world clocking the 200 million mark, we’re not short of choices regardless of which product or service we need.
No matter where you are, how small your industry, or how specific your niche, chances are there are plenty of businesses offering the same thing to the same people, possibly at the same price.
Smart brands understand this and do the necessary due diligence.
They identify what their target audience already has in the market in the way of choices, and they specifically avoid offering the same.
They go out of their way to become the consumer and view the choices in the market from those consumer eyes.
They experience the market as the consumer, in order to fully understand the market landscape including where the market is served well and where it’s underserved.
Comprehensive competitive analysis provides brand builders the information needed to make strategic decisions by answering critical questions such as:
What opportunities exist?
What are the gaps?
How do we fill the gaps?
What are the market trends?
What features should we focus on?
What benefits do we promote?
How does our audience feel?
Where is our audience being let down?
How can we stand apart from our competitors?
Without an effective competitive analysis, the answers to these questions would be based on a guess at best.
Why Do You Need Competitive Analysis?
When you think about competitive analysis you can be forgiven for picturing a covert operation to penetrate your competitors guard to steal their secret sauce for yourself.
To be fair, we do go “undercover” as a consumer and may even speak to a competitor’s customer service as part of our due diligence.
But you don’t need to acquire a fake moustache and start ordering Martini’s “Shaken not stirred”.
There is no secret sauce to uncover and even if you found one, that’s not your mission.
Of course you want to understand what your competitors are doing well, but competitive analysis is more akin to geographical mapping than it is undercover spying.
Competitive analysis is part of your positioning strategy where the ultimate goal is to stand apart from your competition as a better option to service their needs.
Ultimately, you need effective competitive analysis to position your brand effectively.
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What Competitor Analysis Aims To Uncover
Competitive analysis provides the information needed to make strategic positioning decisions.
It’s a critical step in mapping the market landscape and uncovers information such as:
Similarities
Differences
Strengths
Weaknesses
Audience Preferences
Offers
Customer Sentiment
Features
Benefits
Value
Price Points
Differentiators
Market Positions
The information uncovered throughout this process, coupled with the audience persona analysis, provides the basis for all positioning strategy decisions.
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The Goal Of Comp Analysis
The process of analysing your competitors paints a clear picture of the conditions in the marketplace.
This includes the strengths of your competitors, what they’re doing well and why their customers may be loyal advocates who will never jump ship.
These strengths can provide food for thought for any developing brand to introduce aspects into their brand that have been proven to appeal to their audience.
Ultimately though, the end goal of a solid competitive analysis is to provide insights into potential gaps and opportunities in the market where your audience are underserved.
Maybe they’re openly vocal about a shortcoming in the industry, have mixed feelings about their options or maybe they aren’t even aware of an alternative because they haven’t been offered one.
Regardless of how the information is used within the differentiation strategy development, the competitive analysis provides a clear outlook for brand builders to use in order to make effective positioning decisions.
Who Needs A Competitor Analysis Framework?
The 14 Step Competitive Analysis Template
There are many steps to analysing your competitors.
If you’re going to do it, you should commit to it and do it properly.
Having a framework and step-by-step guide will keep you on track so you don’t wander off and fall down a rabbit hole of wasted hours.
STEP 1: Create A Data Capturing Tool
Competitive analysis is about first, gathering data to analyse.
Open up a new speadsheet and title the first column “Number”.
List the numbers 1-10 underneath that column.
Title the next column “Category”.
These two columns will provide you with your top 10 competitors and their category.
From here, title each proceeding column based on the data you gather from the proceeding steps.
STEP 2: Identify Your Top 10 Most Relevant Competitors
You might know your competitors well if you’re building a brand in an industry you’ve worked in your whole life.
If you’re building brands for clients, then chances are you’ll be working with industries you’re not as familiar with.
Either way, the key to identifying your top 10 is to focus on relevancy.
For example, if you’re opening a trendy book café, then the McDonald’s down the road is less relevant than the hipster café around the corner.
Start with a search on Google for what you do and capture the top 10 results remembering your relevancy focus.
If the results page is full of multinationals and you’re a small start-up, then you need to get more specific with your search to identify more relevant competitors.
You can also use social media channels such as Facebook, Linkedin and Youtube by typing in keywords or relevant hashtags.
Then there’s the keyword research route.
Identify the highly relevant keywords your target audience searches for around what your brand does and use a tool such as SEM Rush to drill down into the brands ranking for those keywords.
Whichever method you choose, identifying the most relevant competitors is the critical starting point.
STEP 3: Categorize Your Competitors
Next you want to categorise your competitors from one of the following choices:
Primary Competition
These are your most relevant direct competitors. You’ll share the same audience and will have similar or the same products or services.
Secondary Competition
These are the competitors who serve your audience with a lower or higher end version of what you offer. They’re fixing the same problem but often for different people through a different experience.
Tertiary Competition
These are indirect competitors though you play in the same space. They might have slightly different customers and offer a slightly different solution, though there is crossover in what you do and could serve as an alternative.
Although it’s important to have an understanding of the broad landscape, focus on relevancy. You’re top 10 most relevant competitors may all be your primary competition.
Always ask the question when comparing competitors:
“Who would my audience most likely use?”
STEP 4: Experience The Brand
This is where you put on your fake moustache and go undercover to become the customer.
You want, with your consumer hat on, to experience each of the brands in your top 10 list as your customers would experience them.
Each of your competitors will have multiple touch points.
Make it your business to find and experience each one.
STEP 5: Analyze The Visual Brand
The first experience you will likely have with your competitors is their visual brand.
If it’s designed well, this should be making a strategically intended impact and it should also communicate specific characteristics.
Analyse the look and feel of the brand and the moods or feelings it evokes.
Analyse the overall user experience of the website and how the content is presented visually.
Aside from digital, is there any physical branded material you can get your hands on such as brochures or flyers? (this is relatively easy if your competitors have physical locations).
How do they use
Colour
Typography
Images
Supporting Visuals [cons, graphics or patterns]
Does the overall look of the brand communicate a certain message?
If so, what is that message?
STEP 6: Study The Messaging
As you read through the material on you competitors’ websites, pay close attention to the messaging.
Throughout their website, their physical branded material and their social channels, you will have enough to be able to identify themes.
The themes are the repeated messages, which communicate what the brand wants the audience to understand and associate with them which may include key benefits, descriptors of the target audience and differentiators.
Also study the way in which they deliver the messaging.
Are they using fact-based corporate language or are they using engaging storytelling?
STEP 7: Examine The Human Brand Persona
Have any of your competitors adopted a human brand persona to deliver their message?
Can you identify a core archetype you would align to how the brand communicates?
Are there specific characteristics on display through the visual brand or the messaging?
What language is being used by the brand?
Are they overly corporate or do they use informal conversational language or even slang?
What about their tone-of-voice?
Are they serious, witty, professional, playful, caring or gritty?
How would you describe the tone-of-voice they’re using and is it aligned with the visual brand and the messaging?
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STEP 8: Engage In The Content Strategy
What kind of content are your competitors producing?
Do they have a blog?
Do they have a Youtube channels?
Are they helping their audience with useful techniques?
What about their social channels?
What are they posting or sharing?
Are they simply trying to generate likes or are they engaging their audience with stimulating conversations and helpful insights?
STEP 9: Analyze The Marketing Strategy
How are your competitors marketing their products or services?
Are they advertising?
If so, where are the advertising and what are they offering?
Are they giving away free content in the form of a lead magnet on their website (E.g. an free eBook or a free template etc. in exchange for your email).
If they are, sign up with their opt-in form and analyse the emails that come through.
If a series of emails come through over the following days, you’ll likely be on an automated email sequence, which will eventually lead to an email with some kind of offer.
Take every “Call-to-action” they offer you and analyse where it takes you and what messages are delivered to you.
STEP 10: Study The Offers
Throughout their content, their marketing and their overall presence, your competitors should be making offers to their audience to become a customer in some way shape or form.
What are these offers and how are they structured?
Do they offer a free trial or a low-cost entry subscription?
Do they offer discounts off the first product or service or do they simply tell their audience why they are the brand of choice?
STEP 11: Uncover Their Differentiator & Positioning Strategy
From everything you experience from the brand you’re analysing, there will be an underlying message and theme throughout.
This theme is constantly attempting to position the brand in the mind of the audience based on a very specific differentiator.
If the brand has an efficient communication strategy, it should be easy to identify the difference the difference and the big idea they have built the brand around.
Though they won’t communicate specifically what their positioning strategy is throughout their messaging, they should be communicating clearly, exactly why the audience should be choosing them.
This is their differentiator and is more than likely the reason their customers have chosen them as their choice of brand.
If you can’t easily identify your competitors’ differentiators, it’s not your fault; it’s theirs.
If you can’t find it by looking for it, your shared audience won’t see it either.
STEP 12: Study The Fulfilment & Customer Experience
If the price-point is low enough and you have a budget to analyse your closest competitors, follow through on the offer and purchase their product or service.
Most businesses will have an entry-level offer, which allows the audience to experience the brand before committing to a higher priced product or service.
Even if their product is $300, exposure to the customer fulfilment process of your top three competitors for the cost of $900, will be invaluable research you can use throughout your brand development.
Pick up the phone. Speak to the customer service reps and ask as many questions as you can think of… recording all the answers of course.
STEP 13: Analyze The Reviews
Reviews are an absolute goldmine when it comes to analysing your competitors.
Usually the reviews are in the extreme because the extreme experiences motivate reviews more than mediocre ones…
Reviews tend to display customers who are delighted with the brand experience and customers who have been let down or are very frustrated by the brand experience.
Either way, reviews are often emotionally charged and are a window into the mind of your audience.
Positive reviews represent the fulfilled desires they had before they engaged the brand while negative reviews represent the fears they had.
These fears and desires are nuggets of gold when it comes to finding a different way to satisfy your audience.
STEP 14: Perform SWOT Analysis
Review the document where you have compiled all of your research data and begin to identify the strengths and weaknesses of each of your competitors.
The areas of strength represent where your audience is being served well as well as potential threats to your eventual differentiation strategy.
The areas of weakness are where your audience is dissatisfied.
These areas of dissatisfaction represent potential opportunities in the marketplace where your brand can come in and service these needs.
Competitor Analysis Tools To Fast-Track Your Research
Competitor analysis work can be quite tedious and if you’re operating on a budget (whether it’s your own or you clients), much of this work will need to be performed manually.
But there are plenty of tools out there to help you fast-track much of this work and remove some of the manual grunt work from the process if you havew the means.
You certainly don’t need all of these tools but if you’re conducting competitive analysis often, then they can potentially condense days of work into hours.
If you’re oprating at a startup level, some of these tools have freemium levels which you can use on a limited data basis.
PI Datametrics
PI Datametrics provides a wealth of digital intelligence data to global businesses, in equity, content performance, commerce and brand marketing, allowing them to keep up with fast paced changes in consumer and market demands.
In other words, this is a highly sophisticated tool to help analyse trends and audience intent within your industry, which can help to shape your campaigns and them compare against your competitors.
Similarweb
Type in your competitors web address and spy on all of their marketing efforts including website traffic, referrals, search traffic, social media, keywords, audience… the list goes on and on.
This is a freemium tool so you can check out what it has to offer before getting onto the paid plans or jsut use it sparingly.
If you want to understand how your competitors are doing what they’re doing digitally, then similar web has you covered.
Brandwatch Audiences
Wanna know more about the people who follow your competitors on social?
Brandswatch Audiences can dig into who they are, the influencers they listen to and the content they share.
Ahrefs
A sophisticated SEO tool to analyse how your competitors are doing online with the content they’re producing.
You can also line competitors up against each other to find content gaps you could be filling.
SEMRush
A tool I mentioned a little earlier on, SEMRush is one of my favourites.
Again, this tool, just like Ahrefs is a sophisticated SEO tool that allows you to open up the hood of your competitors’ websites.
Specifically keywords, paid search and rankings will give you an insight into their marketing activities and how they’re attracting your shared audience.
Conclusion
Like it or loathe it, competitive analysis is a critical step in developing a brand that can stand apart from the rest.
It’s not enough to identify something your audience would like and run with that.
You need to know who the most relevant players are in the game.
Are you conducting competitor analysis on your own brand or a brand you’re building for a client?
Do you have a favourite technique that works well for you?
Will you add anything from the 14-step framework to your list?
Let me know in the comments Right Now!
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Great read, lots of valuable information, much appreciated!
Cheers Vincent,
Glad you enjoyed it
Stephen
Enjoy reading your blog. Thank you
Brilliant article. Very informative and in depth. I’ll definitely be using this. Thanks!
Thanks Hisham ?
This is a great guide to competitive analysis! Valuable information!
I want to ask you how you feel about such practices as – invite your target audience to evaluate your site and the sites of two main competitors. The article https://gapsystudio.com/blog/ux-competitive-analysis/ writes about this, talking about studying the usability of competitors’ websites.
How productive is this practice?
Any research you can get directly from your audience is valuable… What you need to do is based on your capabilities and investment of time, how valuable would it be for you in particular?