Competitor Analysis: Look at your competitor as your customer

Digitization is rewriting the rules of competition. Online channels undercut premiums in a number of markets, doing so without agents, building brand reputation online and engaging buyers with new technologies. If incumbents fail to quickly understand the structure of the competition and implement and improvise strategies on the fly, then they stand the chance of getting left behind. 

Competitor analysis is about gathering information about your competitors like brand awareness, pricing, financials, products, customer experience, intellectual property, marketing, risks, opportunities, company culture, and distribution which helps your team build better marketing strategies; identify opportunities in the market that are currently under-served; help you take advantage of your competitors weaknesses to grow market share; allow you to make informed decisions about your strategy and ensure you can create sustainable competitive advantages and help you plan for future investments. 

A classic example is the Fair and Handsome brand that created the Men’s fairness cream segment in India. Emami was looking for ways to challenge the Hindustan Unilever’s Fair and Lovely brand. Their customer research which showed that 25-30% of customers of fairness creams were men. That customer insight paved way for a specialized brand for men.

Digital businesses often have winner takes all dynamics as network effects kick in. Google and Facebook lead digital advertising spends. Zomato and Swiggy lead food delivery. Uber and Ola lead mobility. Amazon and Flipkart lead e-commerce. As the market matures, one or two digital players are usually left standing. That’s why there is immense pressure on start-ups to scale fast.

Facebook’s Mark Zuckerberg famously told his team ‘don’t be too proud to copy’ and was obsessed with the competition. The best part is that understanding your competitor is that it allows you to make 10% improvements to your business strategy. Don’t underestimate the power of small improvements. SnapChat introduced the concept of disappearing messages and became a hit with tweens. Twitter introduced the concept of microblogging and attracted thought leaders. TikTok focused on short video and creator led content. Clubhouse is basically a chat room with audio and is attracting the who’s who of Silicon Valley. 

The best competitor analysis harvests digital consumer insights that'll help you make informed decisions about your brand's marketing strategy. Only then will you be able to identify opportunities for improvements within your marketing campaigns - targeting, SEO, content, leads, conversions, revenue, etc. Good competitor analysis is performed regularly and helps you outsmart your competitors.

Reporting on your competitor analysis, presenting it to your manager, is a vital part of the process. To create lucid reports, try out this competitor analysis template.