Competitive Analysis
Definition:
A competitive analysis is a critical part of your companymarketing plan. With this evaluation, you can establish what makesyour product or service unique–and therefore what attributes youplay up in order to attract your target market.
Evaluate your competitors by placing them in strategic groupsaccording to how directly they compete for a share of thecustomer’s dollar. For each competitor or strategic group, listtheir product or service, its profitability, growth pattern,marketing objectives and assumptions, current and past strategies,organizational and cost structure, strengths and weaknesses, andsize (in sales) of the competitor’s business. Answer questions suchas:
- Who are your competitors?
- What products or services do they sell?
- What is each competitor’s market share?
- What are their past strategies?
- What are their current strategies?
- What type of media are used to market their products orservices?
- How many hours per week do they purchase to advertise throughthe media used in this market?
- What are each competitor’s strengths and weaknesses?
- What potential threats do your competitors pose?
- What potential opportunities do they make available foryou?
A quick and easy way to compare your product or service withsimilar ones on the market is to make a competition grid. Down theleft side of a piece of paper, write the names of four or fiveproducts or services that compete with yours. To help you generatethis list, think of what your customers would buy if they didn’tbuy your product or service.
Across the top of the paper, list the main features andcharacteristics of each product or service. Include such things astarget market, price, size, method of distribution, and extent ofcustomer service for a product. For a service, list prospectivebuyers, where the service is available, price, website, toll-freephone number, and other features that are relevant. A glance at thecompetition grid will help you see where your product fits in theoverall market.
