Competitor Analysis
Competitor analysis involves evaluating the strengths and weaknesses of rival companies within the same industry. This process helps businesses understand their competitive landscape, identify opportunities for differentiation, and make informed strategic decisions. By examining competitors' marketing strategies, product offerings, and market positioning, companies can gain valuable insights to improve their own competitive advantage.
8 Key excerpts on "Competitor Analysis"
eBook - ePubMarketing Management
Text and Cases
- Robert E Stevens, David L Loudon, Bruce Wrenn(Authors)
- 2012(Publication Date)
- Routledge(Publisher)
...Evaluating competitors’ strategies allows a business entity to increase or reinforce its understanding of buyer behavior and identify the type of targeted customer. It is also useful in identifying strengths and weaknesses and, consequently, potential market opportunity. The analysis may assist the firm in evaluating whether to position itself as a leader competing head on with other competitors, as a follower with a “me too” strategy, or as a niche performer with a unique strategy tailored for specific strengths and weaknesses and specific market segments. Each major competitor should be studied separately. If this is not possible then the strategy of the closest competitors should be evaluated. In evaluating different competitive approaches the following tasks need to be performed: Review current strategy. Review current performance. Determine strengths and weaknesses. Forecast future strategic possibilities. Analyzing current competitor strategy involves determining how the competitor defines the industry in terms of market segments, product features, marketing mix, manufacturing policy, research and development commitment, growth policy, distribution, and promotion. This analysis can take several forms, but perhaps the most useful is the competitive marketing mix audit. Who are Our Competitors? Major competitors are often easy to identify but some may be overlooked. One way of identifying competitors is to consider the product/market situation. All existing competitors should be identified based on the product/market they are satisfying. For example, a soft drink producer must specify all of the different choice options within the market under which his or her brand will be considered. This would comprise the bulk of the relevant set of competitors and indicates to the marketer that a variety of levels of competition may exist for a company. The most immediate level is brand and item competition...
eBook - ePubBusiness
The Ultimate Resource
- Bloomsbury Publishing(Author)
- 2011(Publication Date)
...For example, do the marketplace implications of change in the rival’s strategy suggest that one is missing an emerging marketplace opportunity or that one should be moving faster to penetrate a specific customer segment? Often, assessment reveals key vulnerabilities not just in one’s own marketplace strategy but also in one’s assets and capabilities. In summary, Competitor Analysis can lead to significant new insights into the world around us, as well as into our own organization. MAKING IT HAPPEN • Focus on analyzing the information gained on rivals in order to reflect on and learn one’s own organization’s vulnerabilities, capabilities, and future direction. • Examine six areas of competitor activity: marketplace strategy; activity/value chain; alliances and networks; assumptions; assets and capabilities; and organizational infrastructure and culture. • Ask what sources can provide the data you need. Look internally for sources of information first. • Always consider what a change in competitor’s activity indicates about the potential change in a broader competitive context. CONCLUSION While many managers feel that it’s all they can do to collect and analyze information about their own business, one cannot really compete in today’s business environment without some understanding of what the competition is up to. Competitor Analysis is a new aspect of a manager’s job, and it has rapidly become a respected discipline. However, analyzing the ways of one’s competitors is valuable only when a company subsequently makes decisions about how it can perform better, based on a wider view of what’s happening in the marketplace. FOR MORE INFORMATION Books: Fahey, Liam. Competitors: Outwitting, Outmaneuvering and Outperforming. Hoboken, NJ: Wiley, 1998. Fleisher, Craig S., and Babette E. Bensoussan. Methods and Techniques for Analysing Business Competition: International Edition...
eBook - ePub- Richard M.S. Wilson(Author)
- 2010(Publication Date)
- Routledge(Publisher)
...(Think, for example, of the way in which BA and the other major European flag carriers have been hit by new entrants such as easyJet and Ryanair; how Hoover and Electrolux were hit by Dyson; how the major clearing banks were seemingly taken by surprise by the telephone and Internet bankers; and how the American car industry was hit by the Japanese.) It is apparent from these sorts of examples and the points made above that Competitor Analysis is not a luxury but a necessity in order to: Survive Handle slow growth Cope with change Exploit opportunities Uncover key factors Reinforce intuition Improve the quality of decisions Stay competitive Avoid surprises. (See Kelly, 1987, pp.10–14) It follows from this that competitive analysis should be a central element of the marketing planning process, with detailed attention being paid to each competitor’s apparent objectives, resources, capabilities, perceptions and competitive stance, as well as to their marketing plans and the individual elements of the marketing mix. In this way, areas of competitive strength and weakness can more readily be identified, and the results fed into the process of developing an effective marketing strategy. Better and more precise attacks can then be aimed at competitors and more effective defences erected to fight off competitors’ moves. An additional benefit of Competitor Analysis, in certain circumstances at least, is that it can help in the process of understanding buying behaviour by identifying the particular groups or classes of customer to whom each competitor’s strategy is designed to appeal...
eBook - ePub- David Campbell(Author)
- 2003(Publication Date)
- Routledge(Publisher)
...It enables an organization to establish the extent of competition within its own industry and market. It also enables the organization to assess the threat of competition from competitors in industries where similar competences to their own are employed. Equally, based on this model, the organization is able to identify other markets that it may be able to enter by leveraging its existing competences and by adding new ones. Once adapted, the framework enables managers to: understand the nature of competition within the industry and markets (both product and resource) in which they operate; understand the threat from competitors in other industries; understand potential opportunities in new industries and markets. Strategic group and Competitor Analysis What are strategic groups? A business can rarely confine its analysis to the level of the industry and markets in which it operates. It must also pay particular attention to its closest competitors who are known as its strategic group (Porter, 1980). Strategic groups cannot be precisely defined but they consist of organizations possessing similar competences, serving customer needs in the same market segment and producing products or services of similar quality. Such analysis allows the managers of a business to compare its performance to that of its closest competitors in terms of profitability, market share, products, brands, customer loyalty, prices and so on. In this way managers are able to benchmark the performance of their organization against their closest rivals. In the automotive industry, for example, we can observe a number of important strategic groupings. Although Lada and BMW are both motor manufacturers – and hence are technically competitors – they operate in quite different strategic groups. They are unlikely to appeal to the same customers, and their products, dealership networks, brand identities and prices are quite different...
- Diana Luck(Author)
- 2010(Publication Date)
- Routledge(Publisher)
...CHAPTER 3 Analysis of the Competitive Environment Learning Outcomes Appreciate the competitive environment and the importance of monitoring rivals. Understand the process and assessment of Competitor Analysis. Identify strategies to improve profitability. Appreciate the significance of competition on the market environment. Identify key sources of information to understand the micro-environment. MONITORING COMPETITORS – Marketers must appreciate the dynamics of markets, the behaviour of rivals and the realities of customer preferences and customer behaviour. – The relevance of the monitoring of competitors will vary according to the structure of the industry. The number of main players, type of competitors and their offerings are inherent to the level of competition. Fragmented industries Although fragmented industries cannot be completely generalised, there are however a number of underlying common characteristics: The number of participants is very large, but their average size is relatively small. The monitoring of the main players/the closest competitors should be conducted. Some industries are characterised by businesses competing for market share rather than random selection among identical providers. The market is underlain by a diversity of incomes, attitudes, tastes and preferences so sellers must discover what best satisfies their targeted customers. Companies must make the most of their product’s unique selling points before their competitors...
eBook - ePubCommercial Due Diligence
The Key to Understanding Value in an Acquisition
- Peter Howson(Author)
- 2016(Publication Date)
- Routledge(Publisher)
...Competitor Analysis DOI: 10.4324/9781315572840-7 This is a relatively short chapter because many of the analysis techniques have already been covered and because a lot of the information is going to come from interviews and desk research, which is covered in the chapters that follow. Competitor Analysis warrants a chapter of its own for two reasons. First, it is important. Buy a company and you are buying its future earnings. Its future earnings depend on it playing to its strengths and exploiting competitors’ weaknesses. But strengths are relative to both customer needs and to the competition. What is the worth of our assessment if the target is going after the same customers with the same value proposition and the same marketing methods as strong, aggressive customers, but we have taken no account of competitor moves and reactions? Second, companies are notoriously bad at looking outside. A good piece of competitor assessment can add enormous value to a CDD exercise. The competitive review is often left until the end of a CDD exercise because competitor interviews (see Chapter 13) are the most difficult and no one really wants to do them until they have a good knowledge of the market. There is nothing wrong with that except that the object should be to get inside the competitors’ heads. When Competitor Analysis gets left behind, it can become a sort of sterile classification exercise. Some common myths Let us first start with a few home truths: Every organization has competitors. They may not always be direct and obvious, but they are there satisfying the same needs of the same customer base. Just because they might not be satisfying the needs of your customers, they are still competitors if they are satisfying the needs of those who could be customers. All companies always know who their competitors are. Just about every organization says this and an awful lot of them do not...
eBook - ePubStrategic Sales Plan
Why Sales Fail and How Wins are Won
- Robert P DeGroot(Author)
- 2018(Publication Date)
- Sales Training International(Publisher)
...Conduct the Competitor Analyses 13. Identify your external and internal competitors. If you plan to sell against the competition, you must know who the competition is in each sales opportunity. Can you imagine how long a professional coach would last if he/she didn't even know what team they were playing next week, much less have a game plan ready to go? Action Items to complete this step: Make a list of external competitors involved in this sales opportunity. Include internal competitors such as “do nothing” and “do it internally” if they are applicable. List the products and services or categories of products and services in which you will be competing against in this sale. If there is more than one competitor for multiple products and services, you might set up a simple matrix with the products and services listed across the top and the competitors listed in the left-hand column. Wherever a competitor competes with a product or service put a checkmark to indicate the need for a Competitor Analysis specifically product to product or service to service. Consequences: What are the consequences if this step is not done? 14. Conduct the competitor analyses. The Competitor Analysis is the cornerstone of competitive selling. You must have at least three Unique Selling Points (USPs) that can quantifiably help the prospect meet their needs better than your competitor can, or you become a commodity where price and delivery are the primary differentiators. Without USPs your ability to establish customer loyalty is only as good as the next price decrease you can provide. Use the “Differentiating Factors” list in the back of the book to help you find other areas where you may have strengths. The items on this list are used by companies that sell commodities to quantifiably differentiate themselves in their marketplaces. Action items to complete this step: Conduct or update the Competitor Analysis for each of your competitors in this sales opportunity...
eBook - ePub- Ian Smith(Author)
- 2012(Publication Date)
- Routledge(Publisher)
...Let them identify the best practices of your competitors that would improve your relationships with everyone along the supply chain. ACTION BOX 4.4. Take each of your competitors and identify the three key components, from the information you have gathered so far, where they are most similar and least similar to your own organization. Now compare this with what you understand to be the accepted basis upon which you and your competitors appear to be competing. Are they the same? If they are different, what does this tell you and how can you use this information? Basis of Competition This chapter has explored competition in some detail but always with the customer in the picture. Let’s bring together what you have learned under four headings. Differentiation If you do not know how your customers distinguish between you and your competitors it is difficult to know how you can either compete with them or improve what you are delivering to your customers. This chapter has explored a variety of aspects of differentiation. It is up to you how you decide to develop those differences and use them to improve or change how you are seen by your current and potential customers. To evaluate what you have found out in order to be able to use it effectively, you will need to compare your current situation with those of your competitors and with your organization’s aims and objectives. Listing and ranking these against different criteria will help your evaluation as will mapping you and your competitors against various differentiating criteria. Share of Voice Competition can be measured in sales or transactions and these can be determined by the effectiveness of your communications. You have been exploring some of the ways in which you reach out and communicate with potential customers. Your success at this is measured not just by the total numbers of customers you reach and win...
