If market domination isn’t what your client is after, you can stop reading here.
Carving out your own place in the market landscape is no easy feat. It’s about knowing your audience, knowing your product, knowing your competitors and knowing how you fit in as an essential part of the puzzle. Let’s face it, we all want to be that missing je ne sais quoi. We all want customers to buy our products thinking, saying and feeling: “You complete me.” And your clients aren’t any different.
In order to successfully scale your client’s business, you need to have a pulse on market trends, their competitors and their company’s strengths and weaknesses. Then, translate all that data and key insights into an actionable marketing plan that sets their brand apart.
Welcome to the world of competitive analysis, a methodology to assess one’s place in the market, identify competitors (direct and indirect) and build a marketing strategy in response. Regardless of your client’s industry, reaching their target audience is more competitive than ever before. So you need to stay ahead of the curve—because this is about the livelihood of you and your clients.
What is a competitive analysis?
Competitive analysis, or competitive intelligence, is the process of gathering and assessing data about other companies vying for market share in your client’s industry. Your ultimate goal is twofold: 1) See how your client’s business and their products or services stack up against competitors. 2) Develop strategies to make their brand the clear choice among customers.
Pooling data from multiple sources and touchpoints, both internally (your client's sales records, quarterly goals/projections) and externally (market forecasts/reports, competitor promotions), gives you a broad picture of where their brand ranks and how to penetrate new areas of the existing market.
The importance of competitive intelligence and analysis in marketing
Conducting an in-depth competitive analysis has far-reaching implications, impacting every aspect of your client’s business. Here are just a few benefits of how market research and analysis can make a difference.
Understand your client’s strengths, weaknesses, challenges and potential
The core of any competitive analysis comes down to a SWOT analysis. A 2x2 matrix assessing your client’s business’ (as well as products) strengths, weaknesses, opportunities and threats. When identifying strengths and weaknesses, focus on your client’s business alone. Items that fall under weaknesses and opportunities relate to your client’s market or industry as a whole.
Strengths: Things your client does well, including qualities and values that set them apart from their competitors. They can be product or resource focused. Don’t discount the expertise and strength of your client’s team. Human capital is incredibly valuable.
Weaknesses: Things your client’s business lacks, limitations to their resources (finances, inventory, technology, employees, knowledge) or areas their competitors simply do better.
Opportunities: An underserved or emerging audience for your client’s products or services, lack of competition, a growing need for your client’s products or services (Did somebody say face masks?), or trends in the market.
Threats: New competitors or an oversaturation of competitors in your client’s market, instability in the industry or new regulations/laws that make doing business more difficult, negative changes in public perception about the products or services your client offers, bad publicity (your client’s product is being recalled), or quite possibly the worst situation, no product-market fit.
Enhance product features or service offerings
Complete an audit of your client’s products or services. Do a side-by-side comparison of their products or service offerings with their competitors, tallying their strengths and weaknesses. When conducting your audit, here are some basics to consider:
Does their product have better specs?
Does it have a unique selling point (made in the USA, locally sourced, vegan leather or Fair Trade Certified)?
Do they offer services that are hard to find?
Is their staff more experienced, or more sought after?
Are their products or services over-priced, at-market cost or below the market standard? How does this price point position your client—as a luxury brand, or value for the money?
Clearly identify areas in which your client’s products or services make them stand out in the market and areas they can improve to better compete.
Diversify a product line or develop new products
Building on a product or service audit, you may realize your client needs to up their competitive game by expanding business offerings. Look outward at your client’s competitors and see how they’re able to take a larger share of the market by giving customers more of what they want.
If your client has a service business, they can quickly up sales by creating custom branded products promoting their brand, or dropship products related to their industry. Let’s say your client owns a pilates studio. They can diversify their business offering by selling pilates and yoga related products, such as mats, fitness rings, foam blocks and more. Plus, with print on demand, they can create tees, tanks, leggings and totes with their logo and studio name. Chances are their most avid clientele will buy these items, boosting sales while promoting their business.
Assess the market landscape
Analyzing your client’s competition gives you vital info about the market as a whole. When you identify the major players of any market, you soon realize if it’s oversaturated, dominated by one MVP or if there’s healthy competition and room for growth.
In an oversaturated market, or one that has a clear leader, you need to be honest with your client. Draw attention to hidden opportunities and strengths they have and how they can potentially pivot their products or services to capitalize on the market. For example, if your client is in an oversaturated drone market, they could pivot their product offering and focus on high-end drone accessories, like cameras.
If your client is in a market with fair competition and no clear market leader, overhaul their marketing plan. Harness the power of influencers to reach new audiences, incentivize repeat business, change up their product line or offer popular services in bundles and more. Moreover, clients in this kind of market need to be made aware of possible threats. What are their competitors doing now that could cut into their future market share? How can they stay smartly on the offensive? Support your clients with strategic planning that accounts for their current situation while anticipating changes to the market.
Identify emerging segments
Combining what you learned from your client’s SWOT analysis and the current market landscape, you should be able to start connecting the dots to new opportunities. Emerging market segments and niche audiences in particular could mean big rewards for your client. New segments enter markets with more or less buying power, while others in the population age and their needs shift. Additionally, public perception about certain products and services change over time. Pay attention to the root of evolving attitudes. Nowadays, many businesses are directly impacted by a lack of economic stability and consumers that are choosing to save instead of spend.
Your clients need guidance on how to adapt their marketing efforts and messaging to cater to new segments, or the fluidity of existing ones. What worked for their initial target audience or customer-base may not lead to conversions with new audiences, especially in times of economic uncertainty. However, if they are able to speak to these segments in a meaningful, authentic manner, they’ve come more than halfway to building a loyal consumer base.