A Step Ahead. Right Way to Analyze Competitors

Research and analysis of competitive environment is the basis of product marketing strategy. This fact is evidenced by the cases of collapse of several trade empires. If the company is not capable to investigate in time and to forecast the actions of its competitors it is likely to get the bad results. This publication provides advises and recommendations which will help you to control the situation.

                 What Is Possible to Do?

It is evident that any data about competitors will be useful. They may help in preparation of real plan of struggle on the market. What information is necessary for impartial analysis of competitors and development of product marketing strategy? Let’s examine this issue more in details.

1.    Determination of competitors. Information available to public about activities of competitor companies operating on your market may be received from mass media, different information portals and press releases; and it is possible to examine the data about their achievements and plans. In addition, some experts also recommend to be smart. For example, it is possible to write a letter, to call to competitors and to get information about real prices for product or service.

2.    Competitors’ price tracking. Public sources or inquiries are used for that. It is possible to develop inquiry form with key questions and to ask your own clients and other market players to fill it.

3.    Analysis of suppliers. Information about suppliers is usually open and not secret.

4.    Analysis of distribution. The sources may be the company’s sites, advertising materials and presentations, marketing reports, and contractual documents.

5.    Analysis of resources. The sources may be the data about the funds and capital in circulation. Some companies present such financial statements at their web-sites.

6.    Analysis of company’s structure and management. Such information may be freely available in the Internet. Depending on the form of property it may be present at official web-site of the enterprise.

Objective to Get All This Information

There are several key functions of research of competitors. Due to the correctly collected, well-structured and analyzed information you may determine:

·         Consumers’ perception of your competitors. It is important to form the company development strategy and to detect “weak points” – by neutralizing them you may get the customer’s attention and loyalty.

·         Reputation of competitor companies. Image of the company is very important because the consumers pay attention only to the reliable companies.

·         Competitor’s strong and weak points (SWOT analysis). Such analysis helps to identify important aspects of competitor’s activities. Such analysis was offered for the first time by American consulting company Boston Consulting Group; it is a comprehensive analysis of factors and threats for the company development.

·         List of possible competing companies.  Such analysis may help to reveal hidden competitors activities of which are not in your field of vision.

·         Competitors’ strategies. This information will help you to improve marketing strategy of your own company. Knowing the plans of competitors it is possible to form the system of protection of your own enterprise.

·         Competitors’ position on the market. Competitor companies influence not only on development of the sector in which they operate, but also on financial and economic parameters of each other. Management of the company should take in consideration the influence of possible risks and factors, should track market fluctuations and preferences.

·         Substituting products. Not only the companies from one sector, but also competitors which may influence in this or that way on situation on the target market manufacturing the similar products should be the subject of research.

In other words, it is possible to state that analytics and analysis of the results of competitors’ activities form the platform for internal modernization of any company. The enterprise may not operate successfully in vacuum - it should react to changes on the market.