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Five tips for conducting brilliant competitor analysis

Insights for innovation

Posted: Thu 31st Aug 2023

Competition. It can be easy to underestimate it but knowing where to begin in analysing it can feel overwhelming.

As an experienced market researcher, getting stuck into a competitor analysis has helped me understand the wider market, its trends and indications of customer needs for my clients' businesses and my own business.

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What is a competitor analysis?

Before we get stuck into the tips for doing a competitor analysis, let's look at what we mean by competitor analysis. Here's a good way to define your competition:

Direct: They do the same job in the same way, e.g. McDonald's and Burger King.
Secondary: They do the same job in a different way, e.g. Zoom vs. Business Class travel.
Indirect: They do a different job with a conflicting outcome, e.g. McDonald's and Weight Watchers.

When we think about a 'job' it's part of the idea of the Jobs-to-be-done framework which is outside the scope of this article.

Put simply, it's something someone needs to get done and typically a product or service gets the job done.

There is no such thing as 'no competition' - there is pretty much always a way to get a job done in various ways, even if it is different from your product or service.

Five tips for doing a competitor analysis

Let's get into the tips for doing a competitor analysis.

1. Ensure you have a very clear value proposition to compare to your competitors

Before starting your competition analysis, ensure you have a value proposition. A value proposition is a statement that summarises why people would choose your products and services.

You can use the Strategyzer tool to help you figure a statement out if you need further clarification.

2. Set your parameters at the start so you're not overwhelmed

Having a really clear idea of what your competitor analysis will focus on will help to refine your competitor analysis.

So, it could be that you're looking at the job that your product or service solves in a particular geographical location. As an example, imagine you want to open a new coffee shop in the town centre of Northampton. Before you put too much time into making your dream a reality, you want to test out your competition.

In this scenario, the job the coffee shop is getting done is primarily providing people with coffee and possibly cake, so that is the main focus, but you may want to consider tea shops, restaurants and delivery services as they are providing people with coffee but in a different way.

The parameters will be the travelling distance people will be willing to take to get coffee and look in that area.

3. Reflect on your competition

A 'quick' competitor analysis will focus on the strengths, weaknesses and lessons learned from each competitor.

As the potential coffee shop owner, you may wish to pay the competition a visit: What did you like? What did you think was missing? How are they selling coffee to customers? What didn't you like? What did you learn about the experience? Are there any gaps in the market you've noticed?

Similarly, you can do this online by visiting the websites of your competitors. Keep a log by creating a small database on something like Notion, a word document or a spreadsheet - it depends on how in-depth you want to go.

4. Look at the feedback your competitors are getting from customers

You can learn a lot about the customer experience of your competitors by looking at what people are saying online about them, through reviews or forums.

This will show the weaknesses of your competitors and may give you some ideas as to how to beat the competition.

5. Keep the competition analysis going

Analysing the competition can be seen to be a 'one-off' task but it's something that needs to be revisited periodically as the competitors evolve and change and the market conditions change.

Some competitors may come out of the market, some may change direction in their marketing and sales tactics and others may grow and get stronger.

Relevant resources

Insights for innovation

If you're looking for a mentor that has been an entrepreneur and understands what it's like in your shoes, then look no further! Freelancers, micro businesses, small businesses, SMEs and startups, I can help you with your growth action plan in a number of ways. You can book a 45-minute free discovery call with me here: https://calendly.com/chloe-ifi/45min Here are the different ways I can help you: Business strategy and planning Overall business analysis and organisational diagnostics, developing the business mission and vision for the overall business strategy and using the business model canvas. Identify ways to measure success through OKRs and collecting company-wide data through sources such as CRM. Understanding customers for marketing and brand strategy Customer segmentation, value proposition clarity, competition analysis, market research, brand strategy, creating lead generation material and marketing strategies to make your business stand out. Product and service strategy and management Product management strategies for across the life cycle of a product and what research and data is needed at each point. Research strategy and delivery Analysis of research needs, data audit across the business and how to use business intelligence to learn about customers. Defining researchops and user/market/design research plans. Innovation grant funding and pitch decks Exploration of business plan and funding needs to identify the best fit grants for your business from EU and UK sources and ways to apply for grants depending on resources and budget. Putting together pitch decks for fundraising. Scaling and growing a business Build the right team, analyse team dynamics, skills and develop clear processes that can be scaled and profitable, innovation strategy and sales and go-to-market strategy. Operations and processes Analysis of operations, risks, contractual aspects and efficiencies or inefficiencies in operations to automate aspects and develop lean operations using process and technology. Partnerships, stakeholder management and business development Identify strategic partnerships, develop stakeholders and discuss ways to manage stakeholder relations. Linking with marketing is sales and business development, looking at the sales funnel, ways to cross-sell and up-sell and how to convert marketing leads into sales leads. Project management advice and delivery Upskill the team or help deliver project management strategies and use of templates for monitoring and evaluating projects and programmes.

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