How to Perform a Best-in-Class Competitor Analysis?  

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How to Perform a Best-in-Class Competitor Analysis?  

Competitor analysis, also known as competitive analysis, is a comprehensive evaluation of the strengths and weaknesses of competitors in a specific market or industry. It involves assessing various aspects such as competitors’ products, services, pricing strategies, distribution channels, marketing tactics, market share, customer base, and overall performance. Competitor analysis aims to gain insights into competitors’ operations and identify opportunities and threats that can inform strategic decision-making within one’s organisation. 

Benefits of competitive analysis

A competitive analysis framework can benefit various stakeholders, including –

  • Businesses – companies can use competitive analysis to understand their position in the market relative to competitors, identify areas for improvement, and develop strategies to gain a competitive advantage.
  • Marketing teams – marketing teams can use competitive analysis to identify gaps in the market, understand consumer preferences, and develop targeted marketing campaigns that differentiate their products or services from competitors.
  • Product development teams – product development teams can use competitive analysis to benchmark their products against competitors, identify features or functionalities that are lacking or could be improved, and prioritise areas for innovation.
  • Sales teams – sales teams can use competitive analysis to understand competitors, pricing strategies, sales tactics, and value propositions, enabling them to position their products or services better and address objections during sales negotiations. 
  • Investors can use competitive analysis to evaluate the strength and potential of companies they are considering investing in, assess market dynamics and identify emerging trends or disruptions that could impact their investment decisions.
  • Startups – startups can use competitive analysis to conduct market research, identify competitors, and understand the competitive landscape before entering a new market or launching a new product. 

Steps involved in a competitor analysis 

  1. Identify competitors – identify direct and indirect competitors in your industry or market. Direct competitors offer similar products or services to the same target audience. In contrast, indirect competitors may provide alternative solutions to fulfil the same need or cater to a smaller customer base.
  2. Gather information – collect relevant information about each competitor, including their products or services, pricing strategies, target market, distribution channels, marketing tactics, strengths, weaknesses, and market share. This information can be gathered from various sources such as company websites, press releases, industry reports, customer reviews, and social media. 
  3. SWOT analysis – conduct a SWOT (strength, weaknesses, opportunities, threats) analysis for each competitor to identify their internal strength and weaknesses and external opportunities and threats. This analysis will help you understand where each competitor stands relative to your company and where you can potentially gain a competitive advantage.
  4. Benchmarking – compare your company’s performance and offerings against your competitors using key metrics such as product features, pricing, quality, customer service, brand reputation, and market share. 
  5. Identify trends and patterns – analyse trends and patterns in the competitive landscape, such as emerging technologies, changing consumer preferences, shifts in market dynamics, and new entrants. 
  6. Customer feedback analysis – gather customer feedback about your competitor’s products or services through surveys, reviews, and social media channels. Pay attention to common pain points, complaints, and areas where competitors are perceived to excel. This will provide valuable insights into areas where you can differentiate your offerings and improve the overall customer experience.
  7. Strategic implications – based on the insights gathered from the competitive analysis, identify strategic implications for your own company. Determine how to leverage your strengths, address your weaknesses, capitalise on opportunities, and mitigate threats to gain a competitive edge in the market.
  8. Continuous monitoring – competitive analysis is an ongoing process, so it’s essential to continuously monitor the competitive landscape for any changes, updates, or new developments. 

Competitor or competitive analysis is researching both direct and indirect competitors. This involves studying their sales, marketing strategies, business tactics, and products to gain insights into their strengths and weaknesses. The primary aim of conducting a competitor analysis is to comprehend the strengths and weaknesses of one’s brand. This information is then utilised to enhance business and marketing strategies, ultimately guiding informed decision-making within the organisation. 

Steps involved in a competitor analysis: 

1. Examining company and business metrics

The initial phase of analysis should involve gathering fundamental information about your competitors. This includes details such as the company’s founding year, the names of key individuals, including the CEO, locations of company offices, and the number of employees working there. 

Examining competitors’ job openings, often posted on their websites, LinkedIn, and job search platforms like Glassdoor and Indeed, provides valuable insights. Understanding the specific hires and team expansions of competitors can offer valuable insights into their strategic steps, including both product development and marketing initiatives.  

Make a separate section in your spreadsheet to note down your competitors’ revenue and customer numbers. Use a Google search with your competitor’s name and keywords like “revenue” or “customers” to find interviews or press releases where these details are disclosed. Companies often share such information proudly to highlight their successes. 

It’s crucial to understand the timing, amount, and sources of funding by competitors, especially if you are considering capital raise. This information will give you a reliable estimate of the financial resources you can expect to receive. To avoid competition and conflicts of interest, VC investors make only one investment in a given business category.  

2. Understanding product portfolios of competitors 

The analysis of the product portfolios of your competitors can assist you in upgrading your product offerings. This analysis involves core selling points, technologies, perks offered by products, and product features.  

Pricing is another crucial component in product analysis. While conducting a pricing analysis, it is important to consider the affordable plans offered by competitors for small businesses or startups and the heavy options available for big brands and agencies. You must look into white label options or API and whether the plans are monthly or annual.

Explore your competitors’ websites to discover if they provide complementary features to their products. Look for offers like free trials or freemium versions. Investigate whether they offer any free tools to their customers or have a perks program in collaboration with other tools. 

A fundamental aspect of technology companies is the evaluation of their technical stack against competitors. Reviewing job postings is an excellent approach to identifying the technology stack they employ, as you can analyse the specific skills they seek in potential candidates. 

3. Consumers and brand awareness

The next significant step in competitive analysis involves examining what customers say about your competitors. This section comprises the share of voice, the customer’s point of view, and their feedback. Share of voice involves assessing the number of mentions your competitors receive on social media and the web compared to each other. 

The limitation of evaluating a competitor’s awareness level is that it may not always be helpful. A surge in negative comments could occur if a competitor has been involved in the data scandal or is providing bad customer service, and this would be an opportunity to highlight possible drawbacks. In addition, it will help you better understand the particular features of products their customers love and dislike.  

Examining the geography and demographics of mentions related to your competitors enables you to identify the primary markets they are concentrating on. By exploring social media platforms, you can gain insights into the online spaces where your competitors’ audience is active. Using these findings can enhance your marketing and social media strategies. 

4. Analysing marketing strategies

An analysis of competitors’ marketing strategies includes search engine optimisation, advertising, social media activities, influencers and others, customer service & acquisition, sales, content promotion, and more. Regarding search engine optimisation, the keywords they are ranking for and the backlinks they have gained are two of the most important aspects to consider for competition. 

The social media analysis will give you an idea about your competitor’s activity, followers, and post engagement. These insights will be useful for comparing and evaluating your strategy. While examining the partnerships made by your competitors, it is important to focus on their collaborations with influencers, publishers, and media platforms they have worked with.  

It’s crucial to analyse their blog content and identify the topics they typically cover for content marketing analysis. It is also essential to scrutinise your competitors’ sales strategy if applicable. One of the most effective ways to do this is by contacting every company and making detailed notes on each step, trying to book a demo or call.  

Evaluating the customer service offered by your competitors can help enhance your own services. In many large corporations, customer care does not exist. This will provide an excellent opportunity for new businesses in the industry to capitalise on the aspect. If this applies to your situation, showcase the excellence of your customer service prominently on your website.  

How to Perform a Best-in-Class Competitor Analysis?  

To sum up, the purpose of conducting a competitive analysis is not to copy their strategies but to gain insights into your business’s position in the market. Its goal is to discover new opportunities that will highlight your product’s speciality. 

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