Understanding Your Competition

All online businesses require a powerful and effective marketing strategy. An effective marketing strategy is critical in order for your business to be successful in the long-term. Additionally, it is also important that you know and understand your direct as well as indirect competition. Using the internet to research your competition is a very powerful marketing strategy and we can help you collect and consume this information.

 

A competitive analysis can help differentiate your website from the millions of others out there. It can help clarify your business goals, customize your approach and hone search engine optimizations(SEO) strategies that will set your site higher in Serach Engine Result Page(SERPs) rankings. It is also a good idea to always check out features, quality and price range of your competitors. Being aware of the weaknesses and strength of you competition and comparing it with your own will give you the opportunity to put in place strategies that will allow you to effectively compete in your marketplace. End goal is to capitalize on your strong aspects and take advantage of your competitor's weakness. Remember your competition would be doing the same to you, so having a proactive strategy would work much better instead of reactive strategy.

 

In addition to your existing competition, you should also keep a close eye on your potential and future competition. Remember, new competitors will have to come up with better ideas to compete with established entities in their areas. You should visit blogs, forums and online article libraries that are related to your particular market segment to keep up with new trends, technologies and potential threats to your business. Having a very strong strategy and a loyal customer base will enable your online business to survive all these challenges.

 

So, how to you analyze your competition? According to the U.S. Small Business Administration (SBA), begin your analysis by finding your five closest direct and indirect competitors, and determine whether their businesses are growing, steady or declining. Then, identify their strengths and weaknesses and how their products or services differ from yours. For example, if all or most of your competitors offer free shipping, can you also afford to do so? Can you overcome their weaknesses with faster shipping or more product variety? Start by checking out 20 to 30 web sites in depth. Try putting yourself in your customers’ shoes.

 

Some important things you should look for when researching online competitors’ web sites include:

• Overall look and feel: This includes colors, graphics, fonts and use of space. Is it professional? Do the colors work? Is it too busy? Is it easy to read?
• Downloading time: Is the site too slow?
• Overall look and feel: This includes colors, graphics, fonts and use of space. Is it professional? Do the colors work? Is it too busy? Is it easy to read?
• Advertisements: Are you bombarded with pop-ups and banner ads? Do they have free link exchange, free classifieds or paid advertising opportunities?
• Navigation: Is it easy to move around the site and easy to find information?
• Multimedia:Do they have audio or video clips? How does rich media affect the overall performance and presentation of the site?
• Customer interaction: Do they have forums, e-newsletters or blogs? Can you find contact information and a real physical location (address, phone)? Do they have maps or driving directions?
• Industry knowledge: Do they provide tips, instructions, or industry resources?
• Products and pricing: How is their pricing in comparison to yours? Lower? Much higher? About the same? How many products do they offer? Do they have online coupons or specials? What specific brands are other sites selling?
• Merchant services: Can you order easily online? How is shipping (quick, expensive, free with purchase)? What payment methods are available?
• Search engine optimization: How well do they rank in search engines? Which keywords do they use to optimize their site?

This research should give you an overall feel for your competitors so that you can create a more unique, branded website. Identify the competitive strengths of each company in the analysis, including your own. What makes each company unique? Do they own patents or copyrights that give them a competitive edge? Monitor your competitors over time. Sign up for their email lists and analyze their marketing messages and strategy.

 

When you create your marketing plan or calendar, you should refer back to your competitive analysis for ideas and strategies to help you grow your business. It's a good idea to review pricing and products monthly or quarterly. The key to winning market share is to differentiate your company by providing unique products, services or solutions at competitiv prices. Also, do not ignore customer service. Most successful businesses are built on a loyal customer base and customer loyality comes from outstanding customer service.

 

No business exists in a vacuum online. If you ignore your competition, you will lose the opportunity to discover your own strengths and weaknesses. Effective competitive analysis gives you the information you need to see your company as your customers and investors do, and to tune your marketing and business strategies for success.