To stay ahead of the competition in today’s cutthroat business world, it is crucial to react effectively to your competitors’ moves and anticipate them. Companies must conduct competitive landscape analysis to anticipate competitors’ actions better.
This step-by-step guide will help you understand the process of conducting a competitive landscape analysis to start developing your competitive edge.
What is a Competitive Landscape, and What is Competitive Landscape Analysis?
A competitive landscape is the specific market ecosystem in which a business operates and its activities are compared to those of its direct and indirect competitors. In a company’s competitive landscape, there are other businesses that offer similar services and products, which might pose a risk to the company’s market share.
Competitive landscape analysis thus involves data-based tracking, evaluation, and comparison of the company and its competition. An analytical view of market strategies, products, prices, shares, and business growth of the company to that of related businesses. A data-backed study to identify opportunities for growth, improve offerings and services, and remain competitive.
Below mentioned are some of the metrics used for competitive market analysis:
By analyzing the data and comparing it to similar businesses in the industry, business owners can clearly understand their company’s strengths and weaknesses and how they compare to the competition. This knowledge is important to help the business maintain a competitive edge in its industry.
With the ever-changing market trends, product development, and business models, businesses should constantly conduct these competitive landscape analyses to maintain profitability and growth.
What is the Purpose Behind a Competitive Landscape Analysis?
The primary reason behind conducting competitive landscape analysis is to give an enterprise an edge over the competition within the industry. The following points mention how competitor research can help a business:
New goal development One reason competitor data can be helpful for a business is that it would allow the company to set industry benchmarks for its operations or sales departments. For example, a company can figure out why its rival firm has higher customer support metrics, and then take the required initiatives to improve its support ratings.
Identify market trends Market trends are constantly changing or evolving, and businesses need to remain updated about the shifting market trends to better adjust to the industry. An analysis for competitive market intelligence does this perfectly. It enables a business to track new market trends and incorporates changes into its operating model to better adapt to the need of the hour. Insights gained from the analysis also allow businesses to add to their capabilities and improve their offerings, to better align with emerging trends.For example, through competitive landscape analysis, an organization might come to know the industry-wide increase in online sales over offline sales. The business can then reach this change by deploying a growth strategy concentrating on search engine optimization (SEO), to increase traffic to the website and boost online sales.
Improve business strategies
Complete know-how about the industry rivals can help the company owner assess and improve their business strategies. Moreover, understanding the unique value propositions and the qualities that make the customers buy the business’s products compared to the rivals will foster the innovation of new strategies. This would be beneficial for the company as it would improve the competitive value that the target audience attains from the services of that business.
A thorough evaluation of the rival’s activities can reveal scopes for improvement and give a sense of the blind spots for gaining exposure and revenue. For example, after having done a competitive landscape analysis, a business owner figured out that the prices of the rival product are comparably lower which might be why his firm is experiencing lower customer turnout. Therefore, the owner can then develop strategies to reduce the cost of goods sold (COGS) to reduce prices.
A Stepwise Guide for Conducting a Competitive Landscape Analysis
Below are the five steps that need to be followed by a business owner to perform a competitive landscape analysis:
Identify your competitors The first step in conducting a competitive landscape is to determine who your competitors are. The competition might include direct competitors, which include those companies selling the same product to the same target customers, and indirect customers, which have those selling similar products to the same target group. One must also consider tertiary competitors as they are businesses that might develop new products and become indirect or direct competitors.For example, a CPG company could identify its direct competitors by searching for other manufacturers in the area. Potential indirect competitors might include retailers partnering with the competing brand and selling their products. Tertiary competitors could consist of boutique stores that are not mainstream but are selling similar products.
Perform market research Thoroughly research all the rival firms and record them down in organized metrics. Pay particular attention to the product offering, recruitment tactics, pricing strategy, branding, customer service, website content, making efforts, special promotions, and other relevant information about the activities of the competitors.
Administer a competitor analysis framework After doing the market research and gathering all data, decide on a competitive landscape analysis framework to synthesize the data. SWOT analysis and Porter’s Five Forces analysis are the two main options.A SWOT analysis would help identify areas of improvement and understand the competitive advantage. Similarly, Porter’s Five Forces analysis assesses the competitiveness of a marketplace by evaluating the threats of new entrants, substitute products, buyer power, supplier power, and the intensity of the competitive landscape. This strategy is mainly used for companies aiming to expand their business.
Apply the results Use whatever insights are acquired to reevaluate elements of the ongoing business strategies. Try to concentrate on the practical application which can tangibly improve business outcomes. Also, try to set goals according to the market trends so the business can grow better.
Continue analyzing your competition It is always helpful to conduct competitive landscape analysis frequently, at least once or twice every year, to keep up with the market trends. Also, keep a tab on competition and all the data records in the competitive analysis spreadsheet. If there is a need for a specific goal to be achieved, then competitive analysis can be used as a guide.
Competitive Landscape Analysis with Course5
Course5 has been at the forefront of AI-powered competition sensing enabling clients to make the most of market conditions, trends, competitor activity, and customer sentiment.
We conduct custom market and competitive intelligence services on a project basis or an FTE model. While we have multiple services, some of our key services include:
Market Opportunity Analysis
Trend Monitoring, Early monitoring Systems
Customer Behavior and Perspectives
Promotion and GTM Analysis
We help to address our client’s challenges through our market intelligence transformation solutions. Our solutions are built on process reengineering technology and integrate a 360o approach to analysis and insights generation.
Course5 also offers Compete, our competitive and market intelligence solution. The AI-powered solution has a Digital Shelf module which is central to brands being able to monitor and analyze relevant data and make strategic decisions that help to establish a competitive edge.
Compete helps to closely monitor the competitive landscape with insights across Product, Pricing, Promotion, Place, and People (consumer sentiment). Get a comprehensive view and near real-time insights across industries, markets, and competitors.
Competitive Analysis: A Course5 Case Study
The client, one of the leading eCommerce and retail giants, wanted to conduct a study to understand the payments market overview. They requested a major focus on the ‘Buy Now Pay Later’ (BNPL) segment, to provide a market overview of the BNPL area and the major players in the market.
The research was conducted using an all-inclusive secondary/desk research. The required information was gathered from syndicated sources and publicly available information.
Some of the key insights gathered by Course5 were as follows:
The ‘Buy Now Pay Later’ market has started gaining ground in the B2B market, and banks have also started offering similar schemes.
Leading BNPL companies rely heavily on social media to educate shoppers and are strategically targeting younger audiences such as Gen Z.
BNPL companies have been attracting money-conscious shoppers with seamless delayed payment alternatives that bypass the usual fees.
Payment companies are continuously innovating and using technologies including AI, ML, ARM, and big data to provide enhanced experiences for consumers.
Course5 concluded that the study could help the client revamp its product and connect with a wider audience. The competitive assessment provided in the report was utilized by the client’s insights team, as it helped them understand the overview of the competitive payments and the ‘Buy Now Pay Later’ segment so as to gain deeper insights and understand the recent trends in the payments space.
Staying ahead of your competitors means always being on the lookout for changes in the market and the needs of your target audience. This can be difficult, but it’s essential to conduct knowledge management for competitive intelligence, and effectively manage your market and consumer insights. You can get in touch with us for a demo of our proprietary solution, and if you choose to integrate it into your operations, we’ll help you trump your competitors and identify opportunities for you to remain competitive and for business growth.
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