conducting a competitor analysis for small business guide

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your COMPETITOR

ANALYSIS

Module 1 – Identify © 2012-‐2015 MY PR plus HOWTOMARKETING™ 1 HOWTO Market My Small

Business

+ WHAT IS A COMPETITOR ANALYSIS + WHY IT’S IMPORTANT + HOW TO UNDERTAKE A COMPETITOR ANALYSIS + WHAT TO DO NEXT

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In this section

HOWTO Market My Small Business

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+  A competitor analysis is researching your competitors and understanding their: +  Products, services and offerings +  Strengths and weaknesses +  Customers +  Marketing activities.

The purpose is to better understand what you are competing against and how to best compete.

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What is a competitor analysis?


+  It’s important you know what your competitors are doing because: +  It can provide information about opportunities and gaps in the market

+  It can give you ideas on how to better compete

+  It can inform your own products, services and offerings

+  It can also provide insight into your own customers and how to target them.

+  It is critical you monitor your competitors when you are first starting up but also on a regular and ongoing basis

+  It will influence your marketing choices and strategy and can also be used to inform a SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis of your own business – which we will do in the next section of this module


Why it ’s important


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+  To undertake a competitor analysis you want to get as much information as possible from a variety of sources

+  You’re looking for information about economic and industry trends, customer requirements, products and services

+  You can collect competitor data first-hand by visiting their store or reviewing their website and publications they may produce

+  Review advertisements in local and trade publications, their flyers and brochures, look at their social media sites or blog if they have one

+  Google them to see if they are mentioned on other review sites or in forums

+  If you can, speak to their customers and ask why they chose them +  You may consider hiring a commercial market research agency or even

buy their products and services to compare them with your own.


Undertaking a Competitor Analysis


+  In our Marketing 101 section we talked about how publicly listed companies must publish statements about their performance in annual reports

+  Other companies may promote their achievements on their website or in marketing materials to increase their credibility

+  Industry associations often collate benchmark data relating to performance across an entire industry.

+  You may also obtain anecdotal feedback from other people or observations on how your competitor is performing and use this to inform your marketing opportunity.

+  For example, if you are a hairdressing salon, you may notice a competitor has started offering discounts to university students.

+  You could consider a marketing opportunity that offers the same or a further discount, or you could use this information to target a completely different market such as discounts for seniors.


Competitor’s performance


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+  Choose 3-5 of your major competitors and consider the following factors: +  Location +  Products and services +  Pricing +  Quality +  Reputation +  Sales +  Appearance +  Marketing activities +  Success factors +  What they do badly +  Customer service +  Communication methods +  Online and Social Media presence


Factors to consider


+  Go to your HOWTOMARKETING™ Master Marketing Strategy Excel Workbook (found at the bottom of each module page)

+  Go to the sheet on the bottom left that says ‘Identify – Competitor Analysis’

+  Fill out each of the cells based on the information you find – follow the prompt questions in red

+  Write a couple of sentences in each cell +  You will find a sample Competitor Analysis already completed in the

SAMPLE Master Marketing Strategy Excel Workbook


Competitor analysis tool


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+  Insert competitor's name and location +  Describe their products/services briefly +  Are they the market leaders? Do they have a significant share of the

market? Do they only have share of a specific market segment? +  What do you think is their unique selling point? +  What marketing strategies do they use? What social media? Where do

they advertise? How do they communicate with their customers? +  What do you think are the main contributing factors to their success +  What factors can negatively affect their business? +  What makes them a competitor for your business? +  How will you challenge their strengths and leverage off their

weaknesses? How can you best compete with them?


The questions


+  Use the Competitor Analysis to inform your business strategy and make changes to your operations, products and services if needed

+  Use it in the next Section when you undertake a SWOT (Strengths, Weaknesses, Opportunities, Threats) analysis on your own business

+  This will then inform your overall marketing strategy +  I recommend that you DON’T skip these steps even if you have been

in business a while +  Often marketing your business falls down when you didn’t take the

time to fully get to know what you are dealing with internally and externally and lay a strong foundation and knowledge base

+  The physical exercise of getting these ideas down on paper (or on screen) can make a huge difference and put issues and solutions in perspective

+  Involve other people you trust in the process as well


What next?


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+ WHAT IS A COMPETITOR ANALYSIS + WHY IT’S IMPORTANT + HOW TO UNDERTAKE A COMPETITOR ANALYSIS + WHAT TO DO NEXT

© 2012-‐2015 MY PR plus HOWTOMARKETING™ 11

RECAP – In this section


conducting a competitor analysis for small business guide

Small Business & Entrepreneurship