How to do a Competitive Analysis?
If the idea of carrying out a competitive analysis makes you want to go to dinner and never return, we get it. It sounds tedious, overwhelming, and boring straight-up. But it’s a compulsory practice if you want to create a powerful, healthy brand— and own your market share.
It’s time to buckle down and knock it out, whether you’re creating a brand approach from scratch or somehow (conveniently) never done a correct competitive analysis. Fortunately, you don’t have to walk alone into the dark — or drown in a ton of charts. I have got an easy workout to assist you to figure out what you need to understand.
First and foremost, What is a Competitive Analysis?
The method of categorizing and assessing your competitors in order to recognize their strengths and weaknesses compared to your own is a competitive analysis.
That’s not a complex concept, in other words. It is common knowledge that the better you know your rivals, the better you are likely to beat them.
Why do you need to do a Competitive Analysis?
It is done to obtain objective knowledge of where they (your competitor) stand in order to distinguish and position yourself for world domination. A powerful competitive analysis enables you to identify your competitor’s similarities and differences to assist you to identify the distinctive methods you can overlook them.
When you launch or refresh a brand, is the best time to do this is, but if you’ve never completed one, now is the best time.
Real learning comes about when the competitive spirit has ceased.
How to do a Competitive Analysis?
Now that we have our list of competitors, it’s time to start the actual competitive analysis. Your competitive analysis can be broad or incredibly detailed. I have listed below in various steps:
STEP 1: ASSEMBLE A LIST OF COMPETITORS
Do a brain dump of everyone you can think of in your space, including your arch-nemeses and people who could be perceived as competitors.
STEP 2: SPLIT THEM INTO TWO GROUPS
Split your list into two seals: Present and Aspiring.
- Current competitors: brands that are your present or comparable competitors.
- Aspiring competitors: brands you’d like to compete with (your industry’s Nikes, Apples, and BMWs).
STEP 3: DOCUMENT BRAND ANALYSIS
Now it’s time to analyze how each individual competitor, from their tagline to their brand colors, represents themselves. At this point, you can be as comprehensive or general as you like. Just remember that your objective is to define similarities and differences, so use any language that will help you to do that.
Use this free spreadsheet template https://docs.google.com/spreadsheets/d/1Yc0hTPw26RQCLdf-8s33FFsBA0uQgHkLOPnYVMia8KY/edit#gid=2111664302 for your assessment to save time. It includes a comprehensive list of all competition-related issues, such as:
- Vision, mission, values
- Strength and weaknesses
- Value prop
- Brand promise
The more comprehensive you are, of course, the better your content can be classified. But even if you do a high-level study, you will notice specific trends in how your rivals do stuff like comparable graphic identities (for example, in the video streaming sphere, Netflix and YouTube both use red) or messaging (for example, focusing on characteristics rather than cost). These are the most precious insights that will assist you to position yourself better.
STEP 4: ARTICULATE YOUR OWN IDENTITY
Document the same elements for your own brand.
You will want to find a balance between:
- Emulating stuff that brands you aspire to compete with do (e.g., compete on value)
- Avoiding things that brands you don’t want to compete with doing (e.g., compete on price).
The challenge is to do so while staying original and genuine to who you are.
With a general idea of the characteristics of each brand, grab a whiteboard and begin with a Cartesian chart to visualize your position. (This practice really enables you ‘see’ where you are lying on the spectrum.)
Make several variants, plotting your rivals based on distinct polarities, like:
- Low-cost v/s high cost
- Traditional v/s contemporary
- Niche v/s comprehensive
- Low-quality v/s high quality
- People-focused v/s automated/scalable
You should be able to answer this easy (and most important) question by the end of your competitive assessment: why should a client choose your products/services rather than the competition?