What’s the point of digital marketing, or any marketing at all? It can be many things, however, We can argue that, above all, it is about beating your competition.
So, as the old saying goes: before we can beat our enemies, We should first know our enemies. In the professional world, we call this part: ‘competitive analysis’, and that will be our focus of discussion today.
In its essence, the competitive analysis might seem like a fairly simple task: find out What your competitor is doing, figure out a countermeasure, and when you can’t beat them, you might opt to join them.
Yet, the reality is not that simple. First, finding insights about your competitor is easier said than done. After all, we ourselves will try our best to protect our trade secrets. Second, finding the right countermeasures can be a really hard task, and we can’t really take a trial and error approach due to budget limitations.
So, how can we do a proper competition analysis to launch a successful digital marketing campaign? In this guide, we will discuss the proper steps. Let us begin with the first one: the purpose of competitive analysis.
The Purpose of Competitive Analysis
Above, we have briefly discussed the purposes of competitive analysis. Let us list them again in a more comprehensive way. Conducting a competitive analysis will help you:
- Understanding your current position in the market. How far away are you from industry leaders or direct competitors? In short, you can have the right benchmark.
- Understanding the effective contents, channels, and tactics used by your competitor, and how you can use them yourself.
- Finding new opportunities to outperform your competitors. This is the ultimate goal of competitive analysis.
Now that we’ve understood the purpose, the rest of this guide will discuss how to do the proper competitive analysis in four steps.
Step 1: Knowing Where To Look
There are so many factors and variables to look for, and if we are not careful, it is very easy to lose focus. So, it is very important to know where to look, which is done by identifying the right KPIs and metrics.
So, there are several metrics you should focus on, they are:
1. Content Frequency And Distribution
In this world where content is king, it is very important to track how, and how often your competitors are distributing their contents. Are they posting more frequently than you currently are? Or less instead?
The key here is finding how you can have competitive advantages and maximizing the impact of your contents.
For example, if you are in the entertainment or lifestyle industry, and your competitors are posting tweets in the evening, you might want to consider other times to focus on when there is less competition but there is still enough activity among your audiences.
In short, optimize your posting schedule. This guide might help you in this aspect.
2. Users Engagement
Tracking how your and your competitor’s audiences engage with your content will help you assess the effectiveness of your contents. Your focus here is to track the number of interactions with each content.
There are many tools you can use to analyze interactions, such as the Share Of Interactions(SOI) graph and many other CRM tools and software out there.
3. Followers Growth
We all know that followers are now a priceless asset in this world dominated by social media. You should both track audiences growth of your own social media accounts, as well as your competitors’.
Tracking your own growth allows you to determine whether your contents and overall strategies are effective. By benchmarking your growth against competitors’, you can have a better picture of what they are doing, and whether they are better at certain aspects.
Step 2: Knowing Where To Move
Now that you’ve understood the metrics you will need to focus on, we should figure out which way to move, by finding the right marketing channels for your business.
Here, you should also try to find out the key digital channels of your competitors. You can then either do a direct competition in the same channel(s) or finding other channels where you can compete indirectly.
This is a very nice(and big) list by Smart Insights for all the available digital marketing channels. Also, stay tuned for our own digital marketing channels guide in the very near future.
Step 3: Knowing Who To Analyze
You now know what metrics to focus on and which digital channels to use and keep track on. In this step, we will focus our discussion on your competitors.
Depending on your industry, the size of your competition may vary greatly. However, the truth remains that we only have a finite amount of time and resources to analyze all our competitors at once.
Yes, ideally, you should research as many competitors as possible. However, there are three key competitors you should first focus on: the leaders of your industry, key influencers, and aspirational brands.
For example, McDonald’s might benchmark against their direct industry leader competitors such as Burger King. They might also analyze their industry influencers such as Chipotle, as well as aspirational brands like Chick-fil-A.
Identify the key competitors you should focus your resources on.
Step 4: Put Them All In Motion
Now that you have collected all the necessary information, the last step you will need to do it to put your analysis results in a comprehensive written report.
This is especially true if you are required to report to your higher-ups. However, even if you are a self-employed or business owner, a written report is necessary to analyze things more clearly.
Highlight the KPIs discussed in step 1, especially areas where you are beating the competition. Also, highlight where you are lacking so that you can evaluate on how to improve in the future.
Tools For Successful Competitive Analysis
Before the digital age, the competitive analysis was a much harder task to accomplish, with finding information also a much more complicated process. Nowadays, however, there are a lot of tools and software that can help you, a lot of them totally free.
Here are some of the tools:
1.Website A/B Testing
Websites can be considered as one of the most important branding tools in this digital age, your modern equivalent of window display.
There are many website comparison tools available with different pricing and features. This guide by VWO might help you learn more about website A/B testing.
2. Search Competition Analysis Tools
SEO is obviously one of the most important aspects of digital marketing strategy nowadays, as well as paid search engine marketing (SEM).
The goal here is to find out how your competitors fare in the search engine realm. What keywords are they targeting? Is there still a room for more competition, or should you target other keywords?
You can also analyze backlinks on Moz’s Open Site Explorer. This is especially useful for finding high-value links obtained by your competitors. You can aim to also obtain those links, as well as finding other opportunities. Check our previous guide on link-building here. (link)
Arguably, for SEM, competitive analysis is even more important since it might make or break your cost efficiency. This guide by Cardinal Path lists 15 of the most useful SEM analysis tools out there, it is fairly old but still relevant.
3. New Competition
Tools used primarily for SEO or SEM can also be used to monitor new competitors. If there are any changes in high- ranking pages or new bids for paid search ads, you can know immediately.
4. Social Media
Although they are not exactly a dedicated tool, you can use social media to monitor a lot of metrics, such as the number of followers, engagements, content distribution, and many others. There are also many social media monitoring tools available to make the most of your social media intelligence gathering.
Analyzing and benchmarking your business with your competitors has been the core of any marketing strategy since the old days. Fortunately, it has been made simpler nowadays with all the available tools of the digital age.
However, that doesn’t necessarily mean that competitive analysis today does not have its difficulties. However, by following the tips and tricks we have shared above, you might have an easier time in planning and executing your competitive analysis process.
The keys here is to maximize the use of available tools, focusing on the right competitors, the right metrics, the right digital channels and working with the right experts to outrank your competitors. Once you have figured those, you will have a smoother competitive analysis process.