How Does a Competitor Analysis Help Your Business?

Why do a competitor analysis? There are several reasons. Performing a competitor analysis provides you with valuable insights that will help you position your company for success. You may already be doing this in an ad-hoc way, but a formal process is important to collecting and analyzing information effectively over time.

Understanding Your Market

• A competitor analysis helps you gain insight into the market as a whole. It helps you understand what products and services are selling, and what your clients are looking for. Understanding your market helps you determine where your company fits. All markets change over time, and a competitive analysis helps you understand those changes and adapt accordingly.

Identifying Competitor Strategies

• By studying competitors, you learn their strategies for pricing, product development, and how they service their clients. Are they offering innovative solutions? How do their services address the pain points you hear about from your clients? Identifying your competitors' strategies is important to understanding opportunities and threats for your business. What are they doing better than you? What services do they offer that you don’t? Is there a gap in their services that your company can fill?

Understanding Client Preferences

• What are clients saying about your competitors? Gathering this information provides valuable insights into clients’ pain points, preferences, and needs. This will help you anticipate and meet client expectations.

Benchmarking Performance

• You can use a competitor analysis as a benchmark against your own KPIs. Is a competitor gaining market share while your company is losing it? Does one competitor have better brand recognition than another? You can gain understanding about how well your strategies are working based on how your competitors perform.

Increasing Innovation and Differentiation

• Studying your competitors can help you identify service gaps that are opportunities for innovation. Understanding the competition can help you decide if an innovation is worth the investment to pursue. You can differentiate your company from competitors by offering services that they don’t offer, and demonstrating how you perform existing services better.

Improving Decision Making

• Competitor analysis provides valuable data and insights that can inform decision-making across the organization. It reduces the risk of making uninformed decisions and increases the likelihood of success.

If you are ready to do a competitor analysis, Sage is here to help. Contact us to discuss your needs and create a plan for your company.