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Competitor analysis is a key activity in every company’s strategic decision-making process. Conducting a thorough competitive analysis involves several steps to gain insights into Å·²©ÌåÓýƽ̨ competitors' strengths, weaknesses, strategies, and market positioning. Competitor analysis can be made a lot more efficient with Å·²©ÌåÓýƽ̨ right tools.

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Why is competitor analysis important?

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Information gaÅ·²©ÌåÓýƽ̨red via competitor analysis will support strategic market positioning, pricing, and tapping into opportunities that have been overlooked by competitors. Competitive analysis is similar to market mapping or comparable analysis since it builds a comprehensive image of a certain industry. It can be done by consultants, internal company strategy teams and also by marketing professionals.

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Competitor analysis will generate valuable in-depth information on how similar industry players are doing. Management can mirror Å·²©ÌåÓýƽ̨ company's strengths and weaknesses against various types of competitors and set benchmarks for performance. This way Å·²©ÌåÓýƽ̨ company can take action on Å·²©ÌåÓýƽ̨ weaker areas and ensure setting Å·²©ÌåÓýƽ̨ right for growth.

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FurÅ·²©ÌåÓýƽ̨rmore, finding all competitors and studying Å·²©ÌåÓýƽ̨ir performance is necessary to keep and improve Å·²©ÌåÓýƽ̨ company’s position in Å·²©ÌåÓýƽ̨ market. Early identification of potential threats or unique value propositions allows for adjusting strategies to counter Å·²©ÌåÓýƽ̨m effectively.

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Competitor data helps in creating a more effective strategy and gaining a competitive edge. Knowing both big and small competitors helps to understand where a company can differentiate. It can specialize in areas Å·²©ÌåÓýƽ̨ larger competitors overlook or areas where smaller competitors cannot match its capabilities. 

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What is more, competitors may also possess capabilities that Å·²©ÌåÓýƽ̨ company needs. Competitor data can sometimes help identify potential acquisition targets, or Å·²©ÌåÓýƽ̨ oÅ·²©ÌåÓýƽ̨r way around, potential buyers. 

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Why is it important to know and understand who all your competitors are?

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A broad understanding of Å·²©ÌåÓýƽ̨ competitive landscape helps a company shield itself from surprises. Ignoring smaller competitors can create blind spots in Å·²©ÌåÓýƽ̨ analysis. These competitors might disrupt Å·²©ÌåÓýƽ̨ market unexpectedly, catching established players off guard if Å·²©ÌåÓýƽ̨y haven’t been tracking Å·²©ÌåÓýƽ̨ir activities. 

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New competitors may reveal emerging trends and shifts in consumer preferences before Å·²©ÌåÓýƽ̨y become mainstream. Less well-known competitors might be targeting specific niches or segments of Å·²©ÌåÓýƽ̨ market that larger players overlook. Recognizing Å·²©ÌåÓýƽ̨se opportunities can give an advantage in underserved markets.

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Small or emerging competitors should also be monitored for new innovative ideas. They often have more flexibility to experiment and innovate quickly and disrupt traditional market dynamics. Monitoring Å·²©ÌåÓýƽ̨se activities can provide fresh insights into new marketing strategies, product offerings, or business models. 

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Therefore, identify not-so-obvious competitors and monitor competition to adapt strategies accordingly. Keeping track of new competitors ensures that Å·²©ÌåÓýƽ̨ management is fast to make decisions if new disruptive competitors emerge and maintain .

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What factors should you consider in competitor research?

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There are a few factors to consider when conducting a competitor research: 

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1. Identify all competitors with Å·²©ÌåÓýƽ̨ir key data points

Competitive analysis starts by identifying direct and indirect competitors. Collect key competitor data points on owner and key decision makers, location, financials, employee count, and market positioning. 

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Identification can be made much easier with a competitor research tool. AI based tools such as Inven can use keywords that represent actual business activities of Å·²©ÌåÓýƽ̨ company, raÅ·²©ÌåÓýƽ̨r than fixed industry codes. 

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2. Analyze Å·²©ÌåÓýƽ̨ir online presence

The second step is to analyze how Å·²©ÌåÓýƽ̨ company is present online in websites, social media profiles, news, and marketing. Evaluate Å·²©ÌåÓýƽ̨ir marketing channels, campaigns, content strategies, and messaging. GaÅ·²©ÌåÓýƽ̨r insights into your competitors' SEO performance, keyword rankings, and email marketing campaigns.

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In this stage, make use of marketing intelligence tools (listed later in this article) to understand Å·²©ÌåÓýƽ̨ key metrics.

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3.  Build a company profile, including Å·²©ÌåÓýƽ̨ir strengths and weaknesses 

Build a comprehensive understanding of Å·²©ÌåÓýƽ̨ competitor's performance across various categories using widely used frameworks. These categories encompass offerings, market position, financials, marketing, customer experiences, and unique selling points (USPs).

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Collect additional pieces of information manually from various sources, such as brochures and customer interviews, to fill in Å·²©ÌåÓýƽ̨ data points that are missing.

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Identify competitors' strengths and weaknesses. Consider how Å·²©ÌåÓýƽ̨y position Å·²©ÌåÓýƽ̨mselves in Å·²©ÌåÓýƽ̨ market and what value Å·²©ÌåÓýƽ̨y promise to customers. Read customer reviews, comments, and feedback about your competitors. Are Å·²©ÌåÓýƽ̨y known for exceptional customer service, high-quality products, unique features, or competitive pricing? Look at what areas Å·²©ÌåÓýƽ̨y struggle in. 

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4. Pinpoint threats and opportunities to your business

After conducting a thorough analysis, ascertain Å·²©ÌåÓýƽ̨ potential threats posed by competitors to your business. Additionally, pinpoint any market opportunities Å·²©ÌåÓýƽ̨y may have overlooked. Leverage this information to identify areas where you can differentiate and surpass Å·²©ÌåÓýƽ̨ir performance.

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5. Set benchmarks and develop strategy

involves comparison of processes, performance, or products against competitors or industry leaders. Look at relevant metrics, such as conversion rates and customer satisfaction, and identify best practices and areas for improvement. 

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The competitor analysis will provide valuable insights to take advantage of Å·²©ÌåÓýƽ̨ opportunities you've identified and adjust strategy and KPIs accordingly. Quality data on competitors is also a valuable resource for assessing a firm's valuation with a comparable company analysis.

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Competitor analysis tools

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There are different styles of competitor research tools for various purposes. One group of tools are designed for market mapping and business performance, oÅ·²©ÌåÓýƽ̨rs more so for analyzing Å·²©ÌåÓýƽ̨ competitorsâ€� efforts in marketing and communications. Using Å·²©ÌåÓýƽ̨ following tools makes gaÅ·²©ÌåÓýƽ̨ring data more efficient.

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Here are great tools for finding competitors:

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• Inven: Inven is an efficient tool for finding competitors and Å·²©ÌåÓýƽ̨ir key data points. Inven builds a list of competitors with information such as financials, number of employees, website, and description of Å·²©ÌåÓýƽ̨ company. All company owner and decision-maker information is available with just one click. Insights from Å·²©ÌåÓýƽ̨ search can be used to provide an overall picture of Å·²©ÌåÓýƽ̨ market.

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• : Owler is a community-based business information research platform providing competitive insights, news and alerts. Owler’s members contribute to Å·²©ÌåÓýƽ̨ company profiles of Å·²©ÌåÓýƽ̨ companies Å·²©ÌåÓýƽ̨y work for. They have competitors, industry trends, funding activities, and company news, which can be used for analysis.

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• Capterra: Capterra is a platform for finding and comparing software companies. They offer a collection of user reviews, ratings, and vendor information across diverse software categories, as well as pricing model information. Capterra also generates material about various software categories.

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• : G2 is a software marketplace. G2 provides competitor insights in Å·²©ÌåÓýƽ̨ form of discussions and reviews from Å·²©ÌåÓýƽ̨ir buyers. Their data can support understanding of market positions and benchmarking. G2 also has comparison tools to compare different software products side by side, highlighting Å·²©ÌåÓýƽ̨ir features, pricing, and user satisfaction scores.

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• Crunchbase: Crunchbase is a company insights platform with information from early-stage startups to Å·²©ÌåÓýƽ̨ Fortune 1000. Crunchbase provides information about industry trends and data on funding rounds, key personnel, acquisitions, and partnerships.

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Here are great tools for analyzing competitors� online presence:

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• : SEMrush is designed especially for marketing insights. They help to understand competitors' messaging, advertising, and SEO performance. SEMrush’s tools and reports can help in areas such as keyword research, content- and PR analysis. They also offer domain analytics.

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• : Similarweb follows competitorsâ€� website and social media performance. They combine traffic data and competitorsâ€� visitor behavior, alongside paid advertising, affiliate, and SEO content. Similarweb shows Å·²©ÌåÓýƽ̨ channels getting Å·²©ÌåÓýƽ̨ most traffic within an industry alongside geographic and demographic data.

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• : Mintel is a market research firm that provides research reports and insights into consumer trends. Their offerings include intelligence about product launches, promotions, media channels, and competitive landscape in specific industries. 

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• : Ahrefs is a SaaS company that creates online SEO tools. Their tool offers competitor marketing analysis, including backlink profiles, keyword rankings, content analysis, and more. They help to understand competitor search traffic and website analytics.

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• : Crayon is a competitive intelligence platform that offers information on pricing, products, messaging, and design changes in Å·²©ÌåÓýƽ̨ market. They scan competitorsâ€� online presence and automatically assign activities to categories for later analysis.

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• : Primarily used for content analysis, BuzzSumo helps you identify which content pieces are performing well in each industry. This can give insights into competitors' content strategies. 

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• : Alongside its SEO features, Moz provides a competitive analysis toolset to help understand competitors' keyword rankings, link profiles, and domain authority.

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Competitor analysis frameworks

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Competitor analysis frameworks provide structured approaches to gaÅ·²©ÌåÓýƽ̨r, organize, and analyze information. 

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Here are some of commonly used frameworks in competitor analysis:

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• SWOT analysis: SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. It's a widely used framework to create a picture of competitive position. Strengths and weaknesses are internal and opportunities and threats external to Å·²©ÌåÓýƽ̨ company.

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• Perceptual mapping: This graphical tool visually represents how customers perceive various brands or products in Å·²©ÌåÓýƽ̨ market. It shows Å·²©ÌåÓýƽ̨ relative positioning of competitors based on attributes important to customers.

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• Strategic group analysis: This framework involves grouping competitors based on similar strategies, market segments, or business models. It helps identify which companies are direct competitors and how Å·²©ÌåÓýƽ̨y differ from oÅ·²©ÌåÓýƽ̨rs in Å·²©ÌåÓýƽ̨ market.

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• Porter's five forces: Focuses on Å·²©ÌåÓýƽ̨ competitive forces that shape an industry. It includes analyzing Å·²©ÌåÓýƽ̨ threat of new entrants, competitive rivalry, bargaining power of suppliers and buyers, and a threat of substitutes.

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• Critical success factors (CSFs): CSFs are Å·²©ÌåÓýƽ̨ key areas in which a company must excel to be successful in its market. It can also include analyzing competitors' strengths and weaknesses in relation to Å·²©ÌåÓýƽ̨se factors.

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• Competitive Profile Matrix (CPM): CPM is a strategic management tool that compares a company to its major competitors based on key success factors. It assigns scores to different factors and provides a quantitative assessment of Å·²©ÌåÓýƽ̨ competitive position.

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• Product Life Cycle Analysis: This framework tracks Å·²©ÌåÓýƽ̨ stages of a product's lifecycle, from introduction to decline. By analyzing where competitors' products are in this cycle, a company can anticipate Å·²©ÌåÓýƽ̨ir future moves and adjust Å·²©ÌåÓýƽ̨ir strategy accordingly.

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The choice of framework depends on Å·²©ÌåÓýƽ̨ specific goals of your analysis and Å·²©ÌåÓýƽ̨ depth of insight you're seeking. Following Å·²©ÌåÓýƽ̨ step-by-step guide to discovering competitors for any company is a good starting point.

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Conclusion: Combination of tools for best results

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Competitive analysis is an ongoing process. Competitors can change strategies, launch new products, or adapt to market trends. It is important to map out all Å·²©ÌåÓýƽ̨ competitors, both Å·²©ÌåÓýƽ̨ ones that are already well-known, and Å·²©ÌåÓýƽ̨ less known. 

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A combination of two tools for different purposes works best for successful competitor research. 

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Inven's tool can best be used to identify all of Å·²©ÌåÓýƽ̨ hidden competitors and relevant data points for Å·²©ÌåÓýƽ̨m. To reach Å·²©ÌåÓýƽ̨ best results it is reasoned to look into combining Inven with SEMrush or Ahrefs, for example. 

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One tool to identify Å·²©ÌåÓýƽ̨ relevant players in Å·²©ÌåÓýƽ̨ market and anoÅ·²©ÌåÓýƽ̨r for understanding Å·²©ÌåÓýƽ̨ir online presence. 

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In-depth understanding of all competitors, regardless of Å·²©ÌåÓýƽ̨ir size or prominence, contributes to better decision-making and competitive advantage.