Competitor analysis is an essential marketing strategy in the world of ecommerce. Any entrepreneur , who does dropshipping or who manages the store of a physical store, controls his competitors.
That's why, if you want to be successful in this business, it's vital that you start keeping your competition in check too.
What kind of social media marketing choices do they make? How do they interact with their customers and prospects? Which marketing strategies work best for them? These and many more are the questions you should be answered as soon as possible.
In this article you will find out exactly what competitor analysis is, how and why to do it. In addition, you will discover which tools you can use to make it easier to analyze the competition, and how thanks to these researches you can finally overcome it.
But let's start from the beginning ...
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What is Competitor or Benchmark Analysis?
As it is easy to guess from the name itself, the analysis of competitors is a process that allows you to identify your competitors, analyze their sales and marketing strategies (organic and paid) and their communication (from the brand image, to the tone of voice) through the use of specific tools and models.
The information collected is used to improve their strategies in relation to those of the top performers, understanding what their strengths and weaknesses are and therefore studying a positioning for your brand that has the best potential for success.
It is an activity that must be done before starting an online store, but also every time a new product is launched and occasionally also at other times of the activity. In general, it is always good to keep an eye on the competition, not to copy but to always stay up to date and look for new inspirations.
Competitor analysis: why it is important
Periodically carrying out the competitor analysis has a double advantage: it allows you to identify potential opportunities, but also potential threats.
If your direct competitor decides to add a product Photo Editing Services to his online store that you had not contemplated, keeping it under control will allow you to evaluate whether or not to add the same type of product to your store, so as not to be left behind.
At the same time, even if at the beginning of your business as an entrepreneur you will certainly not clash with the big names in the market, there will always be other novice entrepreneurs who could appear in your niche. By always keeping up with the latest news and marketing decisions from your competitors, you can ensure that you outperform the competition before they even have a chance to compete with your business.
So why do a competitor analysis?
To identify new opportunities: by seeing what others do or do not do, you will always be updated and stimulated to do better;
To identify any threats: the analysis of competitors, if done periodically, also allows you to identify newcomers in your niche before they become dangerous;
To find original ideas, perhaps inspired by what others do to invent an improved version of you;
To find your strengths, which you can bet on to leverage your competitors' weaknesses.