Why Competitive Analysis is a must if you want to emerge as a winner?
Updated: Dec 15, 2019
Competitive Analysis — as stated in the Business Dictionary, “ Competitive analysis seeks to identify weaknesses and strengths that a company’s competitors may have, and then use that information to improve marketing efforts within the company.”
Competitive analysis can be of various types and can extensively be used by any and all types of industries. Be it — finance or medical industry, you need Competitive analysis to stay in the market, have a double-digit growth rate and become the most favourite amongst your target audience. Without competitive analysis, you will be clueless like the poor kid Ishaan in the first half of Tarein Zameen Par.
That being said…now comes the part where a startup says ‘Yeah I get it. But my company is in the early stages and that's why it doesn’t have much growth yet, so why bother? Let me become a medium-size company & THEN I think I will give it a try.’
I am very sorry to state this my friend but by THEN maybe your small startup will not become a medium-sized company, infact it might not exist in the market at all. Why? Because you didn’t know what was happening in the market or about the steps your well-established competitors took to lure customers, who would have been yours!
Now let me explain this in a story — Once upon a time, there were two startups in the cosmetics industry, Butiful Me(A) and Makeup Number One(B), and their well-established competitor ZAKME(Z). Z was very active on social media to reach its consumers and used to follow very well crafted marketing strategy, which led to heavy sales of the products. It used various social media and lead generation channels perfectly to grow its revenue exponentially.
Keeping that in mind, our sweet, enthusiastic and hardworking startup A started marketing on both online and offline channels. The co-founder thought that “My company’s marketing is awesome and well planned so I am gonna have a cup of tea and see my revenue flow in!” Then he waited and waited and.......... waited….but sadly the revenue came in pennies compared to the amount of hard work and money he invested. He just saw his competitors bloom while his business failed. :(
Now, this is how startup B started its journey. It did Competitor Analysis and started learning how its competitors were reaching to their target audience. Which strategy helped its competitor grow in sales and increase in growth. It also made B aware of its competitors' mistakes did and helped devise strategic plan to avoid them. He saw that Z is doing much more than just ads! Z is continuously changing its marketing methods to remain No. 1 in front of its consumers.
With these very crucial insights B started building its own marketing strategies and went on to execute its plans with confidence and enthusiasm. Results came in!! Its ROI (Return on Investment), this time was 150% more than the ROI from the last time. Now startup B is looking to expand its business to other cities and abroad! Happy ending. :)
My point with this story is — if you want to become one of the best in your field you have to keep an eye on- what your market is now, what is its expectations, how your competitors are succeeding with their present marketing strategies, is the market happy with your competitors and if not then what are those pain points and how can you break-through them. This analysis will save not only money but something even more: Your precious TIME.
So if you invest in marketing, DO NOT think that your job is done. You have to know your market and competition to see if your ROI is where you expected it to be or not.