It can be scary to take a good hard look at your competition, but it’s in the best interests of every creative practitioner to know who else is out there, no matter how big or small you are. Understanding your competitors means understanding what your own business should be doing, and how to focus your marketing more effectively. A competitor analysis can also help you understand what your own customers or clients want, and how to better communicate with them.
Start by looking for both direct and indirect competitors. A direct competitor is someone offering the same creative goods or services, in the same market, to the same kinds of clients. Getting very specific about the details reduces the number of direct competitors and makes the process much less fraught, and less complicated.
An indirect competitor is a business that offers the same or similar services as part of a wider offering, or offers something that could serve as a viable substitute for you. Both types of competitors can draw business away from you, and you need to account for direct and indirect competitors alike in your business and marketing planning.
For example, a video production business would include as direct competitors all the other production companies in the same geographical area, making the same kind of work. Your indirect competitors would be people who think they can create professional looking videos with their iPhones, web design businesses that offer video services as well, and perhaps even local broadcasters or TV stations who can produce the work inhouse.Your indirect competitors are broader in scope than your direct competitors, and so harder to analyse specifically. Keep an eye on them though, and watch for any trends, weaknesses or strengths that might affect your business as well.
Step 1: Narrow Down The List
The best way to start a direct competitor analysis is to choose three of your main competitors. Next, write down answers or thoughts about all of the following:
- Overview: Have a high-level look at each competitor or competitor’s product or service. Compare and contrast this to your own offerings. Are they better? Worse? On par?
- Additional value: Beyond the basic overview, what value to your competitors provide to a potential customer? This could include service, add-ons, a better website, a more attractive brand, or a well-organised business.
- Details: Get a little deeper into the details of each product or services your competitors provide. Is there some hidden value that you couldn’t see before?
- Cost: Are they cheaper than you? More expensive? Does this matter to the clients? Cost is always an important comparison, but should never be looked at alone.
- Strengths:What are the main strengths that your competitors demonstrate, or their benefits to customers?
- Weaknesses: What are the main weaknesses or mistakes that your competitors demonstrate?
- Advantages: How can you take advantage of these weakness or mistakes?
- Counteract: How can you counter their strengths with strengths or benefits of your own?
Step 2: Research
The internet makes competitor analysis easy. Your competitor’s websites, their social media and their overall branding should simple to find once you’ve identified them. Google search is a powerful tool here – think about your competitors from the point of view of a potential customer or client. Run a couple of searches with your popular keywords or using keywords that search engines recommend. You can then analyse companies that appear on paid and natural search results.
You can also use product review sites where appropriate to see what customers think of your competitors, as well as obtain some real metrics on how many followers they have.
Don’t neglect the old-fashioned research methods as well – go into their shop if they have one, visit their offices, have a coffee in that cafe nearby. Use your own insight and experience to get a good look at your competitors and size them up in the physical as well as the online space.
Step 3: How Do You Rate?
A competitor analysis is of little practical use if you don’t look at your own products or services and marketing materials with the same inquisitive eye, and then place your findings side by side with your competitors. How well you match up?
If your competitors are doing things well, how can you match them? What strategies or ideas could you appropriate and make your own? And if your competitors are doing things poorly, how can you make the most of your strengths in the eyes of your clients?
Finally, take all the information you’ve gathered and create an action plan. This will outline the steps you plan to take to make your business look different in the marketplace, maximise your strengths, and avoid your competitors’ weaknesses.
