What is a Competitive Market Analysis?
What is a Competitive Market Analysis?
Think you know everything about your business? Think again! Before every sports game, coaches analyze and study their competitors, then craft a strategy based on their research. Just like a championship coach, it’s time for you to take a look at your opponents and find your strengths and weaknesses. There is never a bad time to do a little competitor research—in fact, the best time is right now. Never heard of competitive market analysis before? We’re here to break it all down for you. Keep reading to learn all about what a competitive market analysis is, how it can help you, and what to do with one once you have it.
What is a Competitive Market Analysis?
A competitive market analysis is the process of identifying your top competitors, doing research on their marketing strategies, and using that information to your advantage. You can do many kinds of competitor market analysis reports. For example, you can do a high-level analysis to see, in general, what kind of marketing your competitors are doing. You can also do more specific drill-down analysis reports, such as a deep dive into their social media strategies, keyword rankings, or how they tend to do their holiday promotions.
According to the US Small Business Administration, a competitive market analysis helps you learn from businesses competing for your potential customers. This is key to defining a competitive edge that creates sustainable revenue. Your competitive analysis should identify your competition by product line or service and market segment. Assess the following characteristics of the competitive landscape:
- Market share
- Strengths and weaknesses
- Your window of opportunity to enter the market
- The importance of your target market to your competitors
- Any barriers that may hinder you as you enter the market
- Indirect or secondary competitors who may impact your success
Main Benefits of a Competitive Market Analysis
The main reason you want to conduct a competitive market analysis is simple: It will help you succeed. Knowledge is power, and the more you know about your target market, industry, and competitors, the more you will succeed. A competitive market analysis will, more specifically, help you succeed by:
- Helping you understand your target market better
- Learn patterns throughout the industry
- Find what not to do and what to avoid
- Help to set your own goals for your business with what you want to achieve
Understand Your Target Market Better
One of the most important benefits of a competitive market analysis is that you will understand your target market better. You need to be able to connect with your target market in a specific way. You need to learn their pain points, speak their language, show them imagery they will like, and be in certain places for them to find you.
Not sure who your target market even is? An easy way of obtaining all this information to gain an idea of your target audience is to have a Target Audience Persona performed. A target audience persona outlines a typical member of your target audience. It is a fictional representation of your audience, rooted in demographic and behavioral data that we gleaned from the Audience Insights report. At Navazon, we create 3 audience personas to represent 3 different audience segments. We give them names, faces, and a clear background so you know exactly who to market to.
At Navazon, we use a creative process called Empathy Mapping to dig deep into your ideal customer’s psyche. With empathy mapping, we learn how your audience perceives their world as related to your products or services. You can then design products, brand messaging and ads that connect to your audience at a deeper, more personal level.
Another way of seeing all of this information is to look at what your competitors are doing. Do they get a lot of social media engagement? How is their website traffic? Was their Mother’s Day sale successful? How are they best influenced? If your competitors are doing this right, you can learn how to emulate it in your own way. If they are doing a poor job of this, you just found one (of many!) competitive edges to work with.
Another huge advantage of a competitive market analysis is that you will start to learn some patterns. You’ll get to know how the industry you’re in is doing as a whole, what keywords are performing the best for everybody, how everyone’s paid efforts are doing, and much more. Learning these patterns will help you with your marketing strategy to help predict what to look forward to in the future, and what your competitors will more likely do. This will teach you to zag when everyone zigs, so that you stand out.
Find What Not To Do
Some valuable insight that you may find in your competitive market analysis is that your competitors are either doing nothing strategic at all or that what they’re doing just simply isn’t working. This gives you a big, wide opening to the end zone to score big with your target audience.
Some of the things you will want to consider when looking for what NOT to do include:
- Do their social media posts have poor engagement?
- Is their bounce rate high?
- Do you see the same complaints over and over from customers in their reviews?
- Are they not taking advantage of the latest technology?
- Do they have a blog? If so, does it seem like a human wrote it?
- Do they lack an FAQ section?
- Is their pricing too high or too low compared to yours?
- Do they have case studies? If so, do they seem valuable?
- Do they offer valuable downloadables, such as eBooks or PDFs?
- Do they create and post videos or other informative content?
- Are helpful visuals such as infographics available? Are they of good quality?
Help With Setting Your Own Goals
One of the biggest benefits of a competitive market analysis is for you to set your own goals. You can look at this in many different ways, whether at a high level or in a more specific sense. Ways you can set your own goals with a competitive market analysis include:
- Meet or exceed what your competitors are doing. If some of your competitors are, quite frankly, killing it out there, it is important for you to set some goals to meet or, eventually, exceed whatever they are doing. Whether that is social media numbers, sales numbers, sign-ups, or traffic, you’ve just found a great goal to start working toward.
- Make a plan for the gaps you’ve found. If your competitors are totally lacking and you see nothing but opportunity, an important goal of yours is to make a plan for the gaps you’ve found and tackle them head-on.
- Revisit in a year. Another great goal to set after doing a CMA is to revisit everything in a year. Set your marketing strategy, execute it, and see what happens. Have things improved? Are there still areas you can work on? Or, are your competitors now emulating you?
What is Included in a Competitive Market Analysis?
As you know, a competitive market analysis is a breakdown of everything your competitors are doing marketing-wise. However, what is specifically included in the analysis will be dictated by what your goals are as a company. We can learn more about that with you, and help you set those goals, whenever you’re ready.
When performing a CMA, you’ll want to pick at least five of your top competitors. That’s the number we look for here at Navazon when we conduct CMA’s for our clients. Not sure who they are? That’s okay—we can help. You will want to make a list of direct competitors and indirect competitors to help dictate your analysis. Make the list of competitors, in no particular order, and start diving in.
Some of the data we include in our analysis and reporting include:
- Competitors’ audience demographics
- Competitors’ claims
- Website traffic sources
- Their most profitable keywords
- Their top-performing ads and ad copy
- Their top-performing offers
- Competitors’ social media promotions
- Monthly website traffic
- Organic versus paid campaigns
- Estimated SEO clicks
- Approximate monthly ad budget
- Paid advertising history
What Happens After a Competitive Market Analysis?
Now that you’ve got your CMA in hand, what happens next? Competitive market analysis reports are time-consuming, overwhelming, and sometimes confusing, for non-marketers who are just looking for the next steps. The information in a CMA is extremely valuable and time-sensitive, so make sure you jump on these next steps quickly. If not, your competitors may catch up quickly and everything will change.
The two most important moves you’re going to make after conducting a CMA are:
- Pinpoint your differentiators
- Craft your content strategy
Pinpoint Your Differentiators
What makes you different from the competitors you have researched? If you’re not sure how to answer that, sit down and think about why you created your product or service in the first place.
Ask yourself these questions:
- Were you fulfilling a need or fixing a problem?
- What made you want to fulfill that need or fix that problem?
- Do you sell something special, and you want to make it better?
- How do your graphic design, user experience, content copy, and valuable information stack up next to your competitors?
- Do you have newer or more valuable information available to potential customers?
- Do you use the latest technology? If not, why not?
Keep your eye on trends to make sure your customers feel comfortable with your unique selling proposition(USP), as well as keep an eye on any gaps in the market. If your product, service, or backstory can be matched by your competitors, remove those and find a gap that you can fill. If you are a lawyer or a health-related company, this can mean you need to keep your eye on any emerging laws or industry shifts to take advantage of. Your differentiators will show that you are the first, on top of the latest changes and the expert in those new trends.
Craft Your Content Strategy
The final, most important step to take after conducting a competitive market analysis is to craft your content strategy and move it forward. Using all of the information you’ve gathered in your CMA, conduct a SWOT analysis on yourself. A SWOT analysis stands for Strengths, Weaknesses, Opportunities, and Threats. Make a list of each of these to craft your marketing strategy moving forward. Use this information to guide your SEO, paid advertising, social media, and much more.
Expert Competitive Market Analysis Work with Navazon Digital
Not sure where to get started when it comes to conducting a competitive market analysis or a content strategy once you’ve completed one? The experts at Navazon Digital are here to do all the heavy marketing lifting for you, so that you can focus on running your business.
Navazon helps businesses increase profits through data-driven marketing that expands opportunities and reduces risk. As marketers and entrepreneurs, we understand the value of developing a memorable brand through creativity and consistency. This is accomplished through targeted graphics, videos, and websites that reflect our proven, time-tested methodologies and detailed analytics.
We are content creators who listen to our clients so that we can formulate ideas and strategies based on your unique goals and philosophies. Equipped with this knowledge, we develop a powerful plan, test it and then roll it out on a modest scale. Once we arrive at the winning formula, we can scale up rapidly to meet even the most optimistic growth projections.
At Navazon, we do not believe in “one size fits all.” Every part of the marketing plan is customized, to address your unique niche and positioning strategy.
To learn more about what marketing strategies can help you and your business get the competitive edge you need to succeed, visit us at navazondigital.com