Competition is tough, but it can actually be a good thing in many ways. The more players there are in the market, the bigger the possibility that there’s a huge demand for the products, services and solutions you are offering. A high level of competition can mean that there’s a solid customer base with the interest and the ability to pay for your products and services. It may signal that there’s a good chance for you to grow big.
To earn a stronger position in a crowded market, it’s important to know how to do competitor analysis. This practice allows you valuable insight into understanding your customers and determining the best methods to achieve sustainable growth.
Fortunately, businesses operating in the online arena will find that there are now more tools and technology for collecting and analyzing competitor data with the accuracy and detail that have never been possible before. The key is to be guided with the right principles on how to analyze your competition so information you gathered isn’t simply collected, but most importantly, utilized to push your marketing strategy forward.
Clear goal setting. The first thing you need to do is to identify your main goals for your marketing initiatives. Do you want to increase your traffic? Would you like to reduce your bounce rate? Do you need to gain more conversions? List your objectives and rank them according to priority. This will give you direction as to which competitors you would like to analyze. For instance, if you have identified conversion increase as your target, you can take a look at competitors with websites that have good conversion rates.
Customer understanding. Do you know who your target audience is? These days, you don’t only need to identify your market base, but you also need to segment them into specific demographics. This way, you can create campaigns that will more directly cater to the needs and profile of each customer. Get to know your market, so you also learn the brands (your competitors) who enjoy their full support and loyalty.
Innovative data gathering and analysis. Data has never been available in such scope and depth than today. But it’s useless if you don’t know how to make the most of it. You’ll need to take advantage of the tools that enable you to collect data, whether it’s looking into the ad campaigns of your competitors or checking the performance of their keywords and link profiles.
Competitor analysis is not a one-time project. The market shifts quickly, new players come in all the time and old timers can get booted out in the blink of an eye. Market analysis should be an ongoing mission, as it drives you to be always on your toes and to aim for constant improvement.