What is Competitor Research?
To stay ahead of the competition, you must have a strong position in the market. For this, you need to research who your competitors are, where their strengths and weaknesses lie, and the strategies they implement. This process, called Competitor Research, is used by leading organizations to fill the industry gaps with innovative products and services. But what exactly is it?
A Definition of Competitor Research
Competitor Research involves identifying and analyzing your competitors in a specific industry. It starts by finding out who your competitors are, their strengths or weaknesses, and their strategies to gain a competitive edge.
Thorough research on your direct and indirect competitors will reveal market gaps in an entire space. You can analyze the trends in supply and demand and find opportunities to improve your business strategies.
So, simply put, competitor research is a way to peek at who you should look out for in the market and then analyze what they are doing right to reach where they are. At the same time, you dive deep into those aspects they are doing wrong so you don’t repeat those mistakes!
Types of Competitors
It is important to identify and categorize your competitors into three types- direct and indirect.
Why? By doing so, you can understand whom you should pay more attention to, which aspects must be focused on, and most of all, the good practices that can be adapted. Moreover, their audience base is your potential customers. By analyzing the shift and crafting your marketing strategies accordingly, you can convert them to yours.
Direct
These are organizations that offer products and services similar to yours. In this case, their target audience will also be yours. Direct competitors pose a maximum threat. A customer who likes your direct competitor’s products will probably not buy the same from you.
Let’s say you run a lemonade stall. The neighboring booth is your direct competitor. Their basic product, service, and target customers are all the same as yours. Now, it is the difference in the quality and nuanced details that will set you apart.
Indirect
These competitors sell similar products and services as an indirect revenue source. Let’s take the lemonade stand as an example. Now, say your neighbor starts a booth that sells umbrellas or hats and happens to sell lemonade on the side. A user of an indirect competitor can still become your customer if your products are marketed well.
Importance of Competitor Research
Competitor research helps you stay ahead of the competition. Above all, it helps you understand potential barriers within an industry and your competitive advantage.
Eye for Opportunities
By analyzing your contenders, you are tapping into the hidden market opportunities. Plus, it gives you a wider picture of customer preferences, needs, and interests. You can point out the gaps and take action to impose your power in those areas.
Strategize Better
Thorough research will explain why customers buy certain products from you or your competitors. By keeping an eye on their strategies, you can identify those that work and make changes to the existing ones at your organization. This helps you improve the quality and acts as a differentiating factor.
Stay Informed
It is important to know industry standards, trends, and benchmarks. By tapping into the market, you will see all the existing and potential contenders. This will also help you assess the competitive pressure.
Improve Marketing
With the insights you gain, you can create effective marketing campaigns. This will help you reach the
target audience faster and more efficiently.
The research also thoroughly analyzes their social presence, digital marketing campaigns, and market
positioning.
Key Steps in the Competitor Research Process
Here’s a step-by-step guide on how to do competitor research.
1. Set Your Goals Straight
- A clear idea of your goal will make the process easier. Define the objectives before you start your research. This can include identifying market gaps, improving product design, or improving customer service.
- And then decide your scope of research. This includes geographical area, demographics, and specific industries.
2. Identify Your Competition
- Market research can help you identify your direct, indirect, and potential competitors. This will allow you to run a trend analysis to uncover consumer preferences and market dynamics.
- Market research tools can help you dissect competitor strategies, pricing, and consumer perceptions
to understand the market space better.
By understanding these elements, you can focus on market positioning to set yourself apart! - As mentioned, SurveySparrow’s Market Research Tool can streamline this process. With it, you can send research surveys to gather information such as brand and pricing perceptions and preferences.
- Other methods include customer feedback, online communities, social media forums, search engine
analysis, and SEO tools.
(This section will be further explained in the latter part of this page.)
3. Run A Usability Investigation
- Take time to analyze their online presence and websites. While doing so, focus on navigation, design, and visual appeal.
- From this research, point out the aspects in which they excel and where they fall short. You can also gather usability feedback from potential customers and conduct an independent test. Further, you must study their traffic and lead generation methods.
4. SWOT Analysis
- SWOT is an acronym that expands to Strengths, Weaknesses, Opportunities, and Threats.
- This includes determining the internal positive and negative factors (such as the expert panel they possess or the resources they lack), external factors like market trends or potential partnerships, and threats that can lead to an economic downturn or other related risks.
5. Compare Competitor Value Propositions
- Take a look at the unique features and services they offer. This analysis will give you a clear picture of the differentiators and the overlapping aspects.
- Clearly assess the effectiveness of these propositions in attracting new customers and retaining the
existing ones.
Conducting a marketing audit is also a must. This includes campaigns, content quality, social media advertising, and sponsored campaigns.
6. Derive Conclusions and Execute
- Once the competitors are listed and the analysis is completed, it is time to make changes. Create foolproof strategies to set yourself apart from them.
- The analysis will expose at least a few unmet needs and market gaps. Use these opportunities and capitalize on them!
Best Practices to Follow
There are a few must-follow practices while conducting competitor research. By taking these necessary steps, you can avoid inaccuracy.
1. Avoid Biased Competitor Picks
It is important to be neutral while selecting the contenders for analysis. Brainstorming with your team will help, but you should not rely solely on that. Use trustworthy tools and other methods before concluding.
2. Conduct Comparative Positioning
When conducting a competitive market analysis, use a positioning map to understand where you and your competitors stand. This map can be based on differentiating factors such as features or pricing.
3. Continuous Analysis
There is no ending point to competitive research. You have to keep track and take action
continuously.
You have to stay informed of the changes in the market trends and the addition of new players.
4. Be Creative with Solutions
Examine from various angles. It is always better to think outside the box and develop innovative
solutions. You should not limit your analysis to just the pricing and features.
You gain a competitive edge even if your competitors are larger in size or composition.
SurveySparrow for Competitor Research
As mentioned above, SurveySparrow’s Market Research Tool can streamline your competitor research process.
Roll Out Market Research Surveys
You can create interactive surveys (from scratch or with the help of AI) and send them via multiple
platforms, including email, SMS, Whatsapp, or social media channels. There are also 1000+ customizable
Survey templates that cater to your various needs.
With these surveys, you can gather information about your competitors. This can include brand
perception, product features, services, and even pricing points.
Audience Management
You can segment the contacts based on specific attributes and categorize the data collected. This will help you separate competitor information from other data sets. You can also target the audiences with a personalized approach.
Competitor Perception Analysis
SurveySparrow’s advanced analytics tools help you break down trends and patterns to derive key hidden insights. You can visualize the data on a customizable Executive dashboard.
The responses you get can be further studied using SWOT analysis, sentiment analysis, or AI-driven text analytics (CogniVue). This breakdown will give you an understanding of the market benchmarks and audience sentiments.
Third-Party Integrations
App integrations further simplify your research needs. You can connect
to various applications, including Hubspot, Mailchimp, Zapier, Google Tag Manager, Salesforce, and many
more.
The data collected from the surveys can be exported in various formats, such as CSV, XLSX, and SPSS.
