Analysis of the movements and actions of other businesses and entrepreneurs within your market can provide a clear indication of trends, whilst providing you with a better picture of the strengths and weaknesses of your own business.
Undertaking successful competitor analysis will ensure your business has the best possible chance of improving its share of the market whilst satisfying the needs of your existing customers and clients.
Here are four important tips to consider helping identify and understand the most important competitor information.
Conduct research within a strict budget
It can be all too easy to spend significant sums of money on specialist companies who have the ability to maximise resources at their disposal and with the industry contacts that you would otherwise have no way of making. Therefore, whether you conduct your own competitor analysis in-house or outsource the research it is important to work with consultants that can work within your budget, especially if research is carried out on an ad-hoc, on-going process.
Don’t just trust self-reference information
If you wish to conduct multi-faceted, shrewd competitor analysis it is important to consider a wide variety of sources for critical information on competitors. While many self-reference sources obtainable by hand offer good insight it is also important to consider third-party discussions such as testimonials, reviews, previous market research and press releases for an extra dimension on a competitor’s strategy and ethos.
Agree on basic information to target
Although the type of information each business requires when undertaking competitor analysis differs depending on the industry and the nature of the marketplace, there are a number of basic pieces of information that should form the overview of the research. This includes the background of a company, its products and services provided, existing customer base and working relationships and its current advantages or unique selling points within the market.
Use competitor information to predict future behaviour
One of the primary goals of undertaking competitor analysis is to use the information received to predict the behaviour of competitors in the future months and years. This can be invaluable to businesses in a highly competitive environment as they can attempt to react quicker and steal a march on rivals within a concentrated industry.
The end result of competitor analysis, no matter what size of company you are, should be an improved ability to react to and predict competitor’s behaviour and use that to your firm’s advantage.