How To Do A Competitor Analysis And Why It's Important
As challenges to reaching the top of the SERPs and staying there continue to grow, competitor analysis has become more important than ever. Performed regularly, it helps you understand your own digital properties better. In addition, it gives you the tools and knowledge you need to outsmart your competitors. Below, we take a look at what exactly competitor analysis entails. We’ll also cover how to perform one to give your business an edge.
|07 July 2021
What Is A Competitor Analysis?
A competitive analysis is a research process where you identify major competitors and analyse their products, positioning, strengths, and weaknesses, and compare them to your brand.
As you run through the analysis, you can pinpoint why your competitors are outranking you, and which keywords they’re ranking for. It will reveal their marketing strategies and the audience (local, regional or international) they’re targeting.
By collating digital consumer insights, you can make informed decisions about your brand's digital strategy.
Why Is It Important?
A competitor analysis gives you an overview of your own brand and the market you’re competing in. It can help you learn from competitors’ strengths and their weaknesses. It highlights similarities and differences between you and them.
By analysing your competitors, you will learn where to focus and how to consistently beat them in attracting the same audience by appearing higher in SERPs. It will help you identify opportunities for improvements within your marketing campaigns. This can include enhancing your SEO, targeting, content, conversions, leads and revenue.
It also shows needs and gaps in the market that are not fulfilled by yourself or your competitors. By setting benchmarks for what you need to do to be competitive in your industry, you can create solid business strategies that improve upon your competitors’.
Finally, by including a competitor analysis in your marketing plan, you can show investors that you’re aware of the competition and have a clear picture of the marketplace.
How To Do A Competitor Analysis
There are numerous tools, templates and web applications available (some paid, some free) to guide you in performing a thorough competitor analysis. However, there are some basic steps to follow to gain a comprehensive understanding of your competitors.
1. Identify your competitors
A competitor analysis always starts with an industry search to find out who your competitors are. Focus on direct competitors. These are businesses that offer a product or service that could easily be a substitute for yours. They should also operate in the same geographic area.
There are several ways to do this. For example, Google Advanced search allows for customisation that can quickly reveal competitors in your industry and area. Alexa.com has an Audience Overlap Tool that helps you find sites that share your audience.
And finally, the Australian Taxation Office releases small business benchmarks each year. Its main premise is to compare similar businesses' performance within the same industry. However, it’s also a great guide to help you identify competitors.
2. Compare market positioning
Market positioning is how a business establishes its image or identity to ensure consumers perceive them in a certain way. For instance, how is your company different from your competitors? What are the conditions and opportunities for your niche in the marketplace? And how can your company position itself to stand out?
Look at competitors’ product features, quality, pricing, benefits to buyers, messaging, and customer sentiment. Use this to identify gaps, opportunities and threats related to your own business.
3. Site traffic and performance
How do your competitors’ web presence affect their reach and user engagement and how does it compare to your website?
Collect data from your competitors that includes the following:
- traffic sources
- bounce rates
- time spent on site
- monthly unique visitors
- number of daily/monthly pageviews
- pageviews per user
This will show which brands consumers are most interested in and which traffic sources work best for them. It will assist in framing your own engagement and reach. Additionally, it will help you define what you need to do in order to compete with the top businesses in your niche.
4. Compare keywords
A competitive keyword analysis is one of the most effective ways to gain a crucial advantage over other businesses in your industry.
Start by doing some digging yourself. Google three or four groups of keywords you would like to rank for to see who your competitors in the field are. You could also view a competitor website’s page source code and see what they’ve used in the title tag, meta description, optional keywords tag, alt tags or image title tags.
Alternatively, jump onto Google Keyword Planner Tool and enter the competitor’s URL. It will then present you with a list of competitor keywords. BuzzSumo, SemRush and SpyFu are also popular keyword search tools.
5. Look at your competitors’ content, pricing and offers
Using your list of competitors, make notes of their product or service pricing as well as any offers or discounts. Take a look at their content, the type of content (text and vs visual formats), and how current it is.
What kind of content do they use to drive traffic? What do they use to give the user a better understanding of their product or service? What type of content do they use to engage with the user and close the sale?
This may take some serious legwork, but it will give you a full picture of how they market their business.
6. Analyse their SEO
This involves researching your competitors’ links, keywords and content so that you can compare it to your own, and improve on it. It takes the guesswork out of choosing keywords and link building because you can see what works well for them.
There are various elements involved in competitor SEO analysis. First is finding who is competing for the same keywords, and doing a keyword gap analysis. Then, analyse their top content and Google SERP performance.
Other factors that should be on your SEO checklist are domain authority, sitemaps, page templates (optimised for mobile), backlink strategies, as well as blog topics and post frequency.
7. Review their social media feedback and engagement
Analyse which social media platforms competitors are on, and how they are using them. Is the strategy working for them? How do your efforts measure up against what they are doing and are there gaps that you can fill?
Again, there are many tools that can perform a social media competitor analysis for you. There are some things you can do yourself first, though. For instance, Facebook Audience Insights and Twitter Analytics will show you which other brands your audience follows. These may be competitors you didn’t think about.
Use the analysis as performance benchmarks for your own business. Look at average numbers of followers, share of voice and engagement rates. See what times they post, frequency and which posts create traction. This helps you to learn what content resonates (or not) with your target audience so that you can optimise your content strategy.
8. Tools and methods for staying aware of competitors
Competitor analysis tools come in the form of software or apps. These can help you find information about your competitors and the secrets to their success. They save you time and allow you to monitor your own web performance and strategy. Here are five of the best:
Alexa compares traffic, keywords, backlinks, content, share of voice QuickSearch by Talkwalker for comparing social media Google Planning Tools for advertisers to learn about consumer behaviour SemRush covers keyword research, competitive analysis, social media, etc Google AdWords Keyword Planner to find new keywords, search competitors’ sites and stay on top of keyword trends
9. Perform a SWOT analysis
Pick your fiercest competitors and perform a standard SWOT (strengths, weaknesses, opportunities and threats) analysis.
These are some of the things your SWOT analysis should cover:
- Brand positioning
- Customer experience
- Sales, pricing and marketing strategies
10. Identify your areas for improvement
Once you’ve done a thorough site and SEO audit of your own website as well as that of your competitors, you’re ready to start making some changes. Use all that data to draw up a strategy to improve your own web presence.
It could be SEO, content, or social media where you’re lacking. These are all easily fixable things that you can improve yourself, or get help with from a performance-driven digital marketing agency.
Whether you’re about to go live with a new website or find yours lagging in delivering results, a competitor analysis is one of the most effective ways to benchmark your online business.
All businesses want to be the first thing found in a search, and your competitors are likely optimising their sites as we speak.
Don’t be left behind! Follow our suggestions to thoroughly investigate others in your field and draw up a plan to start remedying your shortfalls and gaps. If you need help, PWD is always here to help!