Decktopus Content Team
What is your standing in the market? This is an important question to improve your business. Understanding your competitors in the market is your chance to achieve success. Finding out about your opponents' weaknesses, strengths, and strategies to achieve will give you an upper hand in overthrowing them. A competitor analysis report allows you to do this exactly! With the results of your competitive analysis report, you will carefully analyze your competitors in the market to find huge opportunities ready for you! Consider this: when you truly understand your competitors, you can anticipate their strategies and respond effectively.
This blog post will outline how to create a competitive analysis report for your business! This post will provide a step-by-step guide to craft your competitor analysis report, only with 6 steps. Within this report, you can build on your marketing strategy and create a more effective business plan. In this entry, you can also find different templates for your analysis and presenting your results!
What is a Competitor Analysis Report in Business?
A competitor analysis report is created by analyzing your direct and indirect competitors in the market in various aspects. A competitive analysis is essential to understand your competitors and identify areas for improvement and growth within your business. Thus, it gives an advantage for businesses to create a business plan based on the industry, products, pricing methods, sales strategies, and promotions methods.
After a competitive analysis report, you can evaluate the strengths and weaknesses, opportunities, and threats of your business competitors and your business. Also, a competitive analysis report enables businesses to anticipate competitors' moves in the market.
Competitive Analysis Report: Why is it Important?
It is crucial to conduct competitor analysis reports. Most businesses usually analyze their own methods and strategies and try to overachieve them, which may be useful. However, studying your competition to see what you lack and what they do better is also important.
With a competitive analysis report, you can find out why customers or clients prefer other companies or businesses that provide the same services or products. In the evolving industry, unfortunately, providing great products or services does not bring immediate success. You need a deep understanding of your industry landscape for a successful business.
Imagine walking on a dark road without any light. Without enough information about your industry, this is exactly how you are standing. Your competitors are hiding in the darker parts of your road, ready to take advantage of your weaknesses. A competitive analysis report can become your flashlight on this dark adventure. It can become your trusted guard by showing you a clear road and possible threats hiding around.
All businesses can conduct a comprehensive analysis report, independent of their business size. However, it is crucial for startups and small businesses to conduct competitor analysis reports to gain insight into the market. With the results of the analysis, they can change their position in the market. Small businesses can make adjustments to business strategies, influence growth, improve products or services, avoid risks, and identify new marketing strategies.
It is also important to note that a competitive analysis report can’t be done only once. The industry is always changing. It is important to stay updated on where you stand in the market. So, regularly updating your report is crucial! Usually, updates will made quarterly or annually. However, depending on your industry dynamics, you may want to conduct more analyses per year.
What to Include In a Competitor Analysis in a Business Plan?
Conducting a competitor analysis report can be quite comprehensive. But don’t worry! It can be divided into 6 simple steps! These steps are generally used, but you can customize them. Adapting these steps to your goals will make your competitor analysis more focused and effective.
- Define your objectives
- Identify your competitors
- Identify your competitor’s products and pricing
- Identify your competitor's sales strategies
- Identify your competitor's strategies
- Conduct a SWOT analysis
How to Do a Competitive Analysis Report?
Let's go over and explain the 6 steps for creating a competitive analysis report!
1. Define your objectives
Starting with a clear goal is important for a successful competitor analysis report. The objective will guide the entire process of the analysis. It will be useful later to clarify the purpose, objectives, audience, and format of your report. You may answer some questions to decide your objective. What aspect of your competitors are you interested in? Or perhaps you can think about what aspects you are lacking and what aspects your competitors are stronger. Similarly, you can investigate almost all the aspects of your competitors to create a more comprehensive and general report!
Here is a list of examples of goals for your analysis:
2. Identify your competitors
In the industry, you will have two types of competitors: direct and indirect.
- Direct competitors are businesses that offer products and services similar to yours to the same customers. These competitors' products can be a substitute for your product. For example, fast-food companies like McDonald’s and KFC are direct competitors, as they both offer hamburgers, french fries, etc.
- Indirect competitors are businesses that offer different products but in a similar category, that is, for the same customer needs. For example, a fast-food company is an indirect competitor of a bakery, as they both respond to the same customer needs but offer different products.
For your analysis, you should only focus on the direct competitors. Yes, there are similarities with your indirect competitors. However, the customer base in your business varies quite a bit from your indirect competitors. You should still keep them on your radar, though! With frequent checks and updates on your competitor analysis report, you can follow indirect competitors. As indirect competitors promote products in a similar category, they can expand the business and come in a direct competitor category. However, till that time, you can focus on your direct competitors for your competitive report analysis.
Once you identify your competitors, you can start to create competitor profiles. It is important to create detailed competitor profiles to understand the competitive landscape of the market. Start by collecting some information on their company demographics. You can easily do this from their website, LinkedIn page, or other social media platforms.
Here are some exemplary questions for you to consider:
- What is the foundation date of the company?
- Where is the company located (and the number of locations)?
- How many employees are working? (Number of employees)
- What is their customer base?
- How many customers (estimated) do they have? (Number of customers)
- What is their market share?
- How much is their annual turnover?
- What is their recent market growth?
3. Identify your competitor’s products and pricing
This can serve as a guideline, and you can include features according to your product:
For Products and Services:
- What products are offered?
- How is the quality of the product?
- What are the shipping options (free or low-cost shipping is available or not)?
- What are the unique features of the products- The WOW factor of the products?
- How is the user experience (easy or hard to use/adapt)?
- What is the style and design of the product?
- How is the customer service?
- How are their warranty and repair services?
- What are the similar features with your product?
For pricing, consider these questions:
- How much is the price of the product?
- What are the offered subscription plans?
- Are there discounts or trials offered?
- Do products fall into low-cost or high-cost categories?
4. Identify your competitor’s sales strategies
Understanding your competitors' sales strategies can be key to your strategy, too. The marketing strategies of the businesses are important to understand what their marketing plan is and how they are conducting it. You have to take a look at their sales strategies. Analyze the channels they use to contact the customers, their sales process, and sales volume figures of the company. You can think of yourself as a customer for a competitor's business and analyze the sales process.
Here are some of the points you can investigate:
- On what platforms are customers contacted? (live chat, AI assistant, etc.)
- On what platforms do companies sell their products?
- What is the satisfaction rate for sales?
- How is the sale process conducted? (having a demo or trial plan, tester products, etc.)
- What are the revenue and sales volume figures? (can be found in public company reports)
5. Identify your competitor’s promotional strategies
In this part, you have to compare the marketing strategies of your competitors. Understanding their promotional strategies can be a way to improve yours. It will be better for you to analyze all the media channels and ads they use. This will create advantages for you later. Also, the content of the promotions is important too. Deeply analyze the story behind their product and marketing strategy. All this data will become valuable assets to enhance your own marketing strategies.
- Social media channels (LinkedIn, Twitter, etc.)
- How many posts? (Number of posts)
- What is the frequency of the posts?
- How many followers do accounts have?
- What is the engagement and interaction rate?
- Are there any collaborations with influencers?
- What is the used Content type? (user-generated or unique content)
- Which activities are trending activities?
- Paid advertisements
- In Google
- In social media platforms
- Website activity
- How many monthly visitors?
- Keywords ranking
- SEO strategies
Reminder: You can use online tools to check your competitor's website's web traffic and performance on Google search. Any SEO tool will do the trick! With these tools and software, you can find information about your competitors.
6. Conduct a SWOT analysis (with Template)
The term SWOT analysis stands for Strengths, Weaknesses, Opportunities, and Threats. Till now, you gathered all the information about your competitors and created their profiles. Now, it is time to compare your business with the competitors. Identify your company’s strengths, weaknesses, opportunities for growth, and future threats or problems.
You can also do this analysis from the eyes of your competitors to uncover more tactics for your business. This analysis will provide you with a roadmap to discover more opportunities. Possibilities for improvement are wide ranged, from attracting more customers to increasing your sales. Since you conducted a comprehensive analysis, there is a high chance that you will gain more than one strategy to implement. Here is a list of points you can compare your company with others:
In this part, include your beneficial internal advantages and assets that can be used as advantages for your company.
- What do we do best?
- What advantages do we have?
- What is our greatest achievement?
Include your internal limitations and vulnerabilities that can turn into threats or be dangerous for your company.
- What could we improve?
- What disadvantages do we have?
- In what areas do we need more training?
In this section, include external factors that can be beneficial for your company’s growth and advancement.
- How can we turn our weaknesses into opportunities?
- How can we turn our strengths into opportunities?
- What could we do today that isn't being done?
In this last part, include external factors that can be harmful or pose risks for your company.
- What obstacles do we face?
- Are we competing with others to provide service?
- In what ways might our weaknesses get exposed or exploited?
That's all! If you have any more questions, you can take a look at this brilliant YouTube video that explains and summarizes competitive analysis reports:
How to Present Competitive (Competitor) Analysis with Templates?
A competitive analysis can be tricky to present because of all the data it includes. It is better to summarize all the important data that can provide helpful feedback for your business.
The easiest way for you to present your report is to prepare your presentation with Decktopus! Decktopus is a presentation assistant that helps you create presentations in no time. There are over 100 templates available to use! Choose any of the ready templates or create your own slides with the help of Decktopus's AI-powered assistant. You can use the report executive summary template for your presentations on competitor companies. This template will allow you to give detailed information with creative designs.
There is also an easier way to conduct your SWOT analysis with Decktopus! You can use the SWOT analysis template that already includes the SWOT questions we mentioned above. Also, you will be ready to present your competitor analysis results after using this template. The template includes other slides, too, on possible future goals and feedback! You can also customize your slides and add any additional slides you need! Preparing your SWOT Analysis results is easier with Decktopus!
Evaluating the Analysis of Competitors Report
As a competitive analysis report provides valuable insight for businesses, like any business tool, there are also some drawbacks. Before deciding to conduct an analysis, it is important to evaluate your situation and context.
The Gains- Advantages of the Analysis:
1. Effective Decision Making:
After a well-prepared report, your analysis will provide many strategies and opportunities. The report enables your business to identify market gaps and potential opportunities for growth. Also, by understanding competitors' strengths and weaknesses, you can assess risks, threats, and challenges for your business and be prepared for them. With this data, your business makes informed decisions.
2. Enhanced Marketing Strategies:
The competitive analysis reports involve a comprehensive search of the marketing tactics used by competitors. After this analysis, lessons on more effective marketing strategies and campaigns can be deducted. In other words, your business can advance its advertisement quality.
3. Product/Service Improvement (Competitive Product Analysis):
The competitive analysis report includes deep research on the products offered by other companies. Through these comparisons, the analysis can highlight the areas that are lacking to satisfy customer needs. Improvements in products or services can be made after deciding their effectiveness and quality.
The Drawbacks- Concerns of the Analysis:
1. Resource/Data-Intensive Research:
Although we provide a guideline to make it easier for you to conduct a competitive analysis report, as you may realize, it is not a quick job. Gathering and analyzing all the data on your competitors can be time-consuming and require several resources. If we were to answer how long it takes to create a competitive analysis report, the answer would change from a few weeks to several months.
Not only this, but some data can tamper with results. Accidentally, including outdated or inaccurate data in your analysis can lead to incorrect conclusions. Similarly, there is an excessive amount of data. As we mentioned, creating a competitive analysis report requires intensive research. It is important to distinguish valuable information from others to avoid data overload.
2. Dynamic Market:
Markets and industries are constantly changing. Even though you have created a perfect competitive analysis report, it can become outdated really quickly. Especially if it is a still-evolving industry, this is highly likely. Therefore, there will be a need to frequently update your analysis to keep it relevant in the changing market. Although it may be tedious to update it, it will provide more accurate insight into the current market landscape.
3. Taking Action After Your Competitive Analysis in Business:
The results of the competitive analysis may not always be easy to handle. It may point out a more fundamental problem that is hard to apply. However, keep in mind that this analysis is not just an information-gathering tool. The key point of the report is to use the results in an effective way to find and solve your company’s problems. After the competitor analysis, the main focus should be on creating a possible and practical action plan. In only this way, you can take advantage of the findings of your competitive analysis results.
Frequently Asked Questions
1. What is a competitive analysis report?
A competitive analysis report is a business tool that examines the competitive landscape in a certain industry. It involves researching and evaluating your competitors to understand their strengths, weaknesses, strategies, and market positioning.
2. Why is competitive analysis important for businesses?
Competitive analysis helps businesses make informed decisions, identify enhanced marketing strategies, identify product/service improvement strategies, and stay ahead of their competitors.
3. What should be included in a competitive analysis report?
A competitive analysis report typically includes information about competitors' backgrounds, products/services, pricing, sales and marketing strategies, and SWOT analysis. It may also contain recommendations based on the analysis.
In conclusion, a competitive analysis report is a valuable tool for businesses looking to thrive in today's competitive landscape. It's not just about understanding your competitors; it's about gaining insights into your own strengths and weaknesses, identifying opportunities for growth, and preparing for potential threats.
By following this guide, you can create a detailed competitive analysis report that will improve your business with knowledge and new strategies. Remember that this is not a one-time assignment! Markets are dynamic, and your competitors evolve almost every day. Regularly updating your analysis will ensure that your insights remain relevant and your strategies stay effective.
Competitive analysis is not just an information-gathering exercise. The information you gather from this process is only as valuable as the actions you take based on it. Whether improving your products and services or enhancing your marketing strategies, the ultimate goal is to use the insights gained to drive a positive change for your business.
As you take a look at the competitive analysis reports, keep in mind that this is not about copying your competitors but rather learning from them. Making competitive analysis a part of your regular business practices, understanding the result of your data, and applying it to your business will bring you success! As long as you are committed to continuous improvement, there is no doubt that you will thrive in your industry.