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I see a lot of articles around the web these days that promote the idea of competitive intelligence. But most posts and articles say to look at web sites, web traffic and key words. While there may be some value in this information, it’s also superficial.
Digital stats are one very small part of strategic competitive analysis. There’s a much bigger marketing picture to consider. Make no mistake: Your competitive analysis is worthless if you don’t answer the important strategic questions.
Spend less time on superficial stats and start looking for things that matter—things that will influence your strategy. You can be more strategic by assessing competitors’ strengths, weaknesses and brand positioning.
First you need to define your competition, and don’t assume the answer is immediately obvious. At least consider the possibility that your most important competitor may be a business that is a competitive substitute. Consider brands that aren’t in your immediate category, but that customers could buy/use as an alternative.
Once you have a list of the top 3-5 competitors, answer the following five questions to identify gaps to close and opportunities to exploit. It will be worth your time.
1) WHAT CUSTOMER SEGMENTS DO THEY SERVE?
This sets the stage for competitive positioning. Is there a target audience or market segment they aren’t serving? One that if you targeted it would create differentiation and distance between you and them? Consider industry, company size, demographics, psychographics, geography, or key customer behaviors. For more on target audience definition, see: 7 Characteristics to Define Your Marketing Target.
2) WHAT ARE THEY BEST AT?
Set your biases aside. What are their strengths? Where do they outshine you? Can you live with these tradeoffs or are there areas where you need to develop a point of parity? Are they so strong in one area that you don’t want to compete directly with them on that attribute or benefit?
3) DO THEY HAVE WEAKNESSES YOU CAN EXPLOIT?
Perhaps your competition is missing the boat with customers in some way. There may be an under- or over-met need that you can address better or more efficiently. Look for areas of friction or customer pain points you could address or take advantage of.
4) WHAT’S THEIR CORE CAPABILITY OR TECHNICAL PLATFORM?
It’s important to note the primary benefits your competitors provide. But you should also pay attention to how those benefits are delivered. What are the technical aspects or capabilities they are leveraging? Do they have something you don’t? Are there any issues with their technology or with how they deliver? The answers often lead to potential points of differentiation for you.
5) WHAT’S THEIR PRICING STRATEGY?
You are looking for white space in your competitors’ pricing strategies. There are two ways to go about this. One is to simply look at price points. Most markets have room for premium, low cost and mid-tier pricing. Is there a gap in one of these areas?
Your second look should be at pricing models. How is the pricing structured? As products? Services? Subscription? Contract? Project, retainer, or hourly? Cost-plus? Look for opportunities to make your offering unique and/or more attractive with different approaches.
PULLING TOGETHER YOUR COMPETITIVE ANALYSIS PROFILES
Boil everything you’ve found down into the most important takeaways. One simple yet effective way to capture your learning is to make a one-page summary for each competitor. Put the top learning from each question on the one-pager. Then write the single biggest implication for your business at the very top or bottom of the page in a large font.
I went ahead and built a one-page profile template you can use. Simply enter your info below for an instant download and fill it out for each competitor.
You might also like:
- Ultimate Guide to Writing a Brand Positioning Statement
- Ultimate Guide to Writing a Creative Brief
- Complete Marketing Plan Template (Word) to Make Planning Easier
- Market and Competitive Landscape Analysis: An Outline to Jumpstart Innovation
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Kevin Namaky is CEO at the Gurulocity Brand Management Institute, a marketing education company that trains and consults for notable brand teams including Kimberly-Clark, Scotts Miracle-Gro, Bolthouse Farms and Gorilla Brands. Kevin is a featured instructor for the American Marketing Association, lectures at the IU Kelley School of business, and has been featured in Ad Age, Forbes, Fast Company and the CMO Council. Previously Kevin worked for 20 years in the corporate and agency world growing notable brands. Follow/connect with Kevin on LinkedIn, TikTok and Twitter.