In order to understand the likelihood of succeeding in a given market, it is important that you undertake a competitor analysis.
Competitor analysis will enable you to:
- Identify your key competitors
- Understand their strategies
- Understand their strengths and weaknesses relative to the products and services your start-up or SME provides
With this knowledge, you will be able to:
- Identify gaps and weaknesses in competitor offerings
- Identify opportunities for your start-up or SME
to:
- Develop new products and services
- Enhance your existing product and service offerings
- Acquire new customers and drive business growth
Understanding your competitor will help you determine the markets and customer your company should focus on, and how your company will differentiate itself and stand out from the competition.
How to undertake a B2B competitor analysis
When undertaking a B2B competitor analysis, make sure you are using a buyer-driven approach. Buyers and influencers will consider multiple options to meet their objectives and requirements. They may look at:
- Direct competitors with similar product or service offerings
- Indirect competitors with different product or service offerings that still provide buyers with what they want
For instance, an IT company looking for project management support may consider using specialist IT recruitment agencies or hire an independent project manager through a talent platform such as Expert360.
As you compile your list of competitors to analyse, make sure it is created from a buyer point of view. A study conducted by the Rain Group found that there is only a 25% overlap in the competitor lists between buyers and sellers.
To avoid this trap, create a buyer-driven competitor list by speaking with current and prospective customers to understand who is in their consideration set when they are looking for alternative product or service providers.
What to Include in Your B2B Competitor Analysis
Your competitor analysis should examine the following:
- WHAT ARE THEIR OBJECTIVES?
- What are their Mission and Vision?
- What are their financial and/or strategic objectives?
Insight gained: Where they are focused, what they might do next and how your company should respond.
2. WHAT ARE THEIR STRATEGIES?
- What markets and customers do they currently focus on?
- What’s their strategic direction moving forward?
- What is their value proposition? How does this vary by key customer segments?
- What is their basis of differentiation?
- What is their customer acquisition strategy?
- Are they involved in any joint ventures and/or partnerships?
Insight gained: What their focus is now, basis of competition, and indications as to their future directions and areas of focus.
3. WHAT ARE THEIR CAPABILITIES AND RESOURCES?
- What do these companies have in terms of:
- Resources (eg funding, equipment, systems and staff)
- Capabilities (eg skills, expertise, methodologies)
Insight gained: Your competitors’ weaknesses, skills, capabilities and resources, which could be strong indicators of what your start-up or SME needs to compete effectively.
4. WHAT DO THEY DELIVER?
- What business issues, challenges or goals do they help solve?
- What products and services do they offer?
- What are their core offerings?
- What do they offer to provide additional value?
5. HOW DO THEY DELIVER?
- How do they provide their products and services?
- What channels do they use
- What customer experience do they provide?
- How do they service and support their customers?
- What service levels and/or service guarantees do they provide?
Insight gained: Opportunities to differentiate by changing and/or enhancing the service, support and customer experience provided.
6. HOW DO THEY PROMOTE TO AND ENGAGE WITH CUSTOMERS?
- What mechanisms do competitors use to promote to
and engage with their customers?
- What approaches do they use to promote to and engage specifically with decision makers? (Eg. social media, events, thought leadership, customer reference programs)
Insight gained: How to improve and differentiate how you engage with current customers as well as attract and acquire new ones.
Sources for Competitor Information
To gain an in-depth understanding of your competitors so that your start-up or SME can develop a strategy to reach and acquire your target customers, consider using the following sources:
- Competitor websites
- Online competitor analysis tools eg. MOZ, Website Grader
- Industry and professional associations
- Speaking with prospective customers and competitors’ customers
Want to learn more about how to drive growth and win in B2B?
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