The small business landscape has expanded beyond imagination to give way to a lot of competition in any given industry. As an aspiring entrepreneur, one major factor to survival is to recognize your competition and strategize your business plan accordingly. This analysis can be done at any point in your business journey as it will help you to identify the threats faced by your company. To go about on conducting a research, you can opt for a SWOT analysis (Strengths, weaknesses, opportunities and threats) which can be extremely helpful in building a marketing strategy by identifying all aspects that effect your business. However, one important part is to conduct an in-depth investigation of your competition which will assist you to assess the strengths and weaknesses of your rival companies so that you can create situations that are favorable for you.
How to conduct a competitor analysis?
Identify your competition
The first step to begin a comprehensive analysis of your competition is to know who your competitors are. Look up for companies that offer similar services or products as you do in the nearby areas and on the web too. Make a list of all the businesses that seem like a threat and keep an eye for an upcoming competition too.
Analyze their current situation
How well is their business doing? Visit their website or other social media platforms and evaluate if the business is doing well. If they are targeting the same market as yours, see if they are able to sell more efficiently.
Recognize their customer acquisition techniques
Every business follows a pattern to attract customers, how does your competition manage to acquire new customers and retain them? Learn more about what they have to offer to the client and what makes the customers go back there. Is it their price, their value or their services? Find out how did they manage to get that reputation.
Review their marketing strategies
This is one of the most important steps to formulate your marketing strategy based on the strategies followed by your competition. How do they advertise their products or services? How do they effectively reach out to their customers? Do they offer something that you don’t? What type of media is used to market their products?
Identify their unique value proposition
Being in the same industry pits you against each other, so learn how your rival is playing this game. What is the USP of your competition? If you are able to identify that, you will be able to devise better strategies to be able to leave them behind in this race. Examine how well they are prepared to deal with factors outside their control, which could turn out to be an opportunity for your business.
Determine your position
After a detailed evaluation of your competitor’s position, now it’s time to focus on your business. Compare your business position with that of your competition and determine where you stand. Formulate a business plan based on the findings of your competition analysis and try to offer better deals to acquire a bigger customer base. Recognize the areas which need improvement and what characteristics of your business are in your favor.