Breaking into an established market is a hard process, especially online. There’s well-known sellers already in place. However, if you believe there’s a future for you, competitor analysis is the way to see what you’re up against and what you need to succeed.
Competitor analysis is about knowing your market. Know who sells or performs services that could compete with what you sell or the services you perform. Keep in mind that every business that could affect your own is a competitor, not just the direct matches. This means also researching the potential competitors. Here are three necessary research areas when doing competitive analysis.
Find the Unique Selling Point
Businesses need a unique selling point to make them stand out from the competition. This could apply to merchandise, customer service, shipping or any other area that would noticeably make you the better option from the point-of-view of a customer.
In order for you to find your unique selling point, find your competitors. See if they’ve become the go-to site for a particular niche. Figure out what customers value with that particular business, and then determine where you fit. If you’re unique enough, your competitors may even be a referral source, and you may refer to them.
Identify Strengths and Weaknesses
Businesses new to the market can learn from the established competitors by carefully analyzing their strengths and weaknesses.
First, look at the company history. There’s a wealth of knowledge in their past endeavors. Pay attention to how they started, why they’re still around, and their past and future projects. Take a look at their social media accounts. Figure out what has caught on with followers and what is dismissed. Perform SEO keyword analysis. See what drives customers to their website.
After you’ve identified everything they’re doing right, learn from what went wrong. There’s also something to learn from mistakes. This refers to projects started and discarded. It’s also failed promotions. Look back at the SEO keywords to determine which are least effective and could be improved.
Research Competitor Pricing
Businesses can have a terrific selling point and take advantage of every strength and weakness, but it can be impossible to break into the market if your prices are unbelievable. Pay attention to the price range out there. If yours is too high, you look unreasonable. If it’s too low, you look cheap (and customers assume you sell cheap products or below-average services.) You may want to start off with promotional pricing. If you go this route, make it clear the pricing is promotional and that your products or services are worth more.
Competitive pricing is something that never ends. Everything from competitors, promotions and seasons affect it. Price competitively all year.
Don’t just enter a market and expect to be recognized. Put yourself out there with both old-fashioned and modern marketing techniques. Target those techniques with in-depth competitive analysis.