competitor analysis business plan

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How to create a competitive analysis (with examples)

Competitive analysis involves identifying your direct and indirect competitors using research to reveal their strengths and weaknesses in relation to your own. In this guide, we’ll outline how to do a competitive analysis and explain how you can use this marketing strategy to improve your business.

Whether you’re running a business or playing in a football game, understanding your competition is crucial for success. While you may not be scoring touchdowns in the office, your goal is to score business deals with clients or win customers with your products. The method of preparation for athletes and business owners is similar—once you understand your strengths and weaknesses versus your competitors’, you can level up. 

What is a competitive analysis?

Competitive analysis involves identifying your direct and indirect competitors using research to reveal their strengths and weaknesses in relation to your own. 

Direct competitors market the same product to the same audience as you, while indirect competitors market the same product to a different audience. After identifying your competitors, you can use the information you gather to see where you stand in the market landscape. 

What to include in a competitive analysis

The purpose of this type of analysis is to get a competitive advantage in the market and improve your business strategy. Without a competitive analysis, it’s difficult to know what others are doing to win clients or customers in your target market. A competitive analysis report may include:

A description of your company’s target market

Details about your product or service versus the competitors’

Current and projected market share, sales, and revenues

Pricing comparison

Marketing and social media strategy analysis

Differences in customer ratings

You’ll compare each detail of your product or service versus the competition to assess strategy efficacy. By comparing success metrics across companies, you can make data-driven decisions.

How to do a competitive analysis

Follow these five steps to create your competitive analysis report and get a broad view of where you fit in the market. This process can help you analyze a handful of competitors at one time and better approach your target customers.

1. Create a competitor overview

In step one, select between five and 10 competitors to compare against your company. The competitors you choose should have similar product or service offerings and a similar business model to you. You should also choose a mix of both direct and indirect competitors so you can see how new markets might affect your company. Choosing both startup and seasoned competitors will further diversify your analysis.

Tip: To find competitors in your industry, use Google or Amazon to search for your product or service. The top results that emerge are likely your competitors. If you’re a startup or you serve a niche market, you may need to dive deeper into the rankings to find your direct competitors.

2. Conduct market research

Once you know the competitors you want to analyze, you’ll begin in-depth market research. This will be a mixture of primary and secondary research. Primary research comes directly from customers or the product itself, while secondary research is information that’s already compiled. Then, keep track of the data you collect in a user research template .

Primary market research may include: 

Purchasing competitors’ products or services

Interviewing customers

Conducting online surveys of customers 

Holding in-person focus groups

Secondary market research may include:

Examining competitors’ websites

Assessing the current economic situation

Identifying technological developments 

Reading company records

Tip: Search engine analysis tools like Ahrefs and SEMrush can help you examine competitors’ websites and obtain crucial SEO information such as the keywords they’re targeting, the number of backlinks they have, and the overall health of their website. 

3. Compare product features

The next step in your analysis involves a comparison of your product to your competitors’ products. This comparison should break down the products feature by feature. While every product has its own unique features, most products will likely include:

Service offered

Age of audience served

Number of features

Style and design

Ease of use

Type and number of warranties

Customer support offered

Product quality

Tip: If your features table gets too long, abbreviate this step by listing the features you believe are of most importance to your analysis. Important features may include cost, product benefits, and ease of use.

4. Compare product marketing

The next step in your analysis will look similar to the one before, except you’ll compare the marketing efforts of your competitors instead of the product features. Unlike the product features matrix you created, you’ll need to go deeper to unveil each company’s marketing plan . 

Areas you’ll want to analyze include:

Social media

Website copy

Press releases

Product copy

As you analyze the above, ask questions to dig deeper into each company’s marketing strategies. The questions you should ask will vary by industry, but may include:

What story are they trying to tell?

What value do they bring to their customers?

What’s their company mission?

What’s their brand voice?

Tip: You can identify your competitors’ target demographic in this step by referencing their customer base, either from their website or from testimonials. This information can help you build customer personas. When you can picture who your competitor actively targets, you can better understand their marketing tactics. 

5. Use a SWOT analysis

Competitive intelligence will make up a significant part of your competitor analysis framework, but once you’ve gathered your information, you can turn the focus back to your company. A SWOT analysis helps you identify your company’s strengths and weaknesses. It also helps turn weaknesses into opportunities and assess threats you face based on your competition.

During a SWOT analysis, ask yourself:

What do we do well?

What could we improve?

Are there market gaps in our services?

What new market trends are on the horizon?

Tip: Your research from the previous steps in the competitive analysis will help you answer these questions and fill in your SWOT analysis. You can visually present your findings in a SWOT matrix, which is a four-box chart divided by category.

6. Identify your place in the market landscape

The last step in your competitive analysis is to understand where you stand in the market landscape. To do this, you’ll create a graph with an X and Y axis. The two axes should represent the most important factors for being competitive in your market. 

For example, the X-axis may represent customer satisfaction, while the Y-axis may represent presence in the market. You’ll then plot each competitor on the graph according to their (x,y) coordinates. You’ll also plot your company on this chart, which will give you an idea of where you stand in relation to your competitors. 

This graph is included for informational purposes and does not represent Asana’s market landscape or any specific industry’s market landscape. 

Tip: In this example, you’ll see three companies that have a greater market presence and greater customer satisfaction than yours, while two companies have a similar market presence but higher customer satisfaction. This data should jumpstart the problem-solving process because you now know which competitors are the biggest threats and you can see where you fall short. 

Competitive analysis example

Imagine you work at a marketing startup that provides SEO for dentists, which is a niche industry and only has a few competitors. You decide to conduct a market analysis for your business. To do so, you would:

Step 1: Use Google to compile a list of your competitors. 

Steps 2, 3, and 4: Use your competitors’ websites, as well as SEO analysis tools like Ahrefs, to deep-dive into the service offerings and marketing strategies of each company. 

Step 5: Focusing back on your own company, you conduct a SWOT analysis to assess your own strategic goals and get a visual of your strengths and weaknesses. 

Step 6: Finally, you create a graph of the market landscape and conclude that there are two companies beating your company in customer satisfaction and market presence. 

After compiling this information into a table like the one below, you consider a unique strategy. To beat out your competitors, you can use localization. Instead of marketing to dentists nationwide like your competitors are doing, you decide to focus your marketing strategy on one region, state, or city. Once you’ve become the known SEO company for dentists in that city, you’ll branch out. 

You won’t know what conclusions you can draw from your competitive analysis until you do the work and see the results. Whether you decide on a new pricing strategy, a way to level up your marketing, or a revamp of your product, understanding your competition can provide significant insight.

Drawbacks of competitive analysis

There are some drawbacks to competitive analysis you should consider before moving forward with your report. While these drawbacks are minor, understanding them can make you an even better manager or business owner. 

Don’t forget to take action

You don’t just want to gather the information from your competitive analysis—you also want to take action on that information. The data itself will only show you where you fit into the market landscape. The key to competitive analysis is using it to problem solve and improve your company’s strategic plan .

Be wary of confirmation bias

Confirmation bias means interpreting information based on the beliefs you already hold. This is bad because it can cause you to hold on to false beliefs. To avoid bias, you should rely on all the data available to back up your decisions. In the example above, the business owner may believe they’re the best in the SEO dental market at social media. Because of this belief, when they do market research for social media, they may only collect enough information to confirm their own bias—even if their competitors are statistically better at social media. However, if they were to rely on all the data available, they could eliminate this bias.

Update your analysis regularly

A competitive analysis report represents a snapshot of the market landscape as it currently stands. This report can help you gain enough information to make changes to your company, but you shouldn’t refer to the document again unless you update the information regularly. Market trends are always changing, and although it’s tedious to update your report, doing so will ensure you get accurate insight into your competitors at all times. 

Boost your marketing strategy with competitive analysis

Learning your competitors’ strengths and weaknesses will make you a better marketer. If you don’t know the competition you’re up against, you can’t beat them. Using competitive analysis can boost your marketing strategy and allow you to capture your target audience faster.

Competitive analysis must lead to action, which means following up on your findings with clear business goals and a strong business plan. Once you do your competitive analysis, you can use the templates below to put your plan into action.

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How to Write the Competitor Analysis Section of the Business Plan

Writing The Business Plan: Section 4

Susan Ward wrote about small businesses for The Balance for 18 years. She has run an IT consulting firm and designed and presented courses on how to promote small businesses.

The competitor analysis section can be the most difficult section to compile when writing a business plan because before you can analyze your competitors, you have to investigate them. Here's how to write the competitor analysis section of the business plan.

First, Find Out Who Your Competitors Are

If you're planning to start a small business that's going to operate locally, chances are you already know which businesses you're going to be competing with. But if not, you can easily find out by doing an internet search for local businesses, looking in the online or printed local phone book, or even driving around the target market area. 

Your local business may also have non-local competitors that you need to be aware of.

If you're selling office supplies, for instance, you may also have to compete with big-box retailers within a driving distance of several hours and companies that offer office supplies online. You want to make sure that you identify all your possible competitors at this stage.

Then Find Out About Them

You need to know:

• what markets or market segments your competitors serve;
• what benefits your competitors offer;
• why customers buy from them;
• as much as possible about their products and/or services, pricing, and promotion.

Gathering Information for Your Competitor Analysis

A visit is still the most obvious starting point - either to the brick and mortar store or to the company's website. Go there, once or several times, and look around. Watch how customers are treated. Check out the prices.

You can also learn a fair bit about your competitors from talking to their customers and/or clients - if you know who they are. Other good "live" sources of information about competitors include a company's vendors or suppliers and a company's employees. They may or may not be willing to talk to you, but it's worth seeking them out and asking.

And watch for trade shows that your competitors may be attending. Businesses are there to disseminate information about and sell their products or services; attending and visiting their booths can be an excellent way to find out about your competition.

You'll also want to search for the publicly available information about your competitors. Online publications, newspapers, and magazines may all have information about the company you're investigating for your competitive analysis. Press releases may be particularly useful. 

Once you've compiled the information about your competitors, you're ready to analyze it. 

Analyzing the Competition

Just listing a bunch of information about your competition in the competitor analysis section of the business plan misses the point. It's the analysis of the information that's important.

Study the information you've gathered about each of your competitors and ask yourself this question: How are you going to compete with that company?

For many small businesses, the key to competing successfully is to identify a market niche where they can capture a  specific target market  whose needs are not being met.

• Is there a particular segment of the market that your competition has overlooked?
• Is there a service that customers or clients want that your competitor does not supply? 

The goal of your competitor analysis is to identify and expand upon your competitive advantage - the benefits that your proposed business can offer the customer or client that your competition can't or won't supply.

Writing the Competitor Analysis Section

When you're writing the business plan, you'll write the competitor analysis section in the form of several paragraphs. 

The first paragraph will outline the competitive environment, telling your readers who your proposed business's competitors are, how much of the market they control and any other relevant details about the competition.

The second and following paragraphs will detail your competitive advantage, explaining why and how your company will be able to compete with these competitors and establish yourself as a successful business.

Remember; you don't have to go into exhaustive detail here, but you do need to persuade the reader of your business plan that you are knowledgeable about the competition and that you have a clear, definitive plan that will enable your new business to successfully compete.

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How to Write Competitive Analysis in a Business Plan (w/ Examples)

Free Competitive Analysis Kit

• Vinay Kevadia
• January 9, 2024

13 Min Read

Every business wants to outperform its competitors, but do you know the right approach to gather information and analyze your competitors?

That’s where competitive analysis steps in. It’s the tool that helps you know your competition’s pricing strategies, strengths, product details, marketing strategies, target audience, and more.

If you want to know more about competitor analysis, this guide is all you need. It spills all the details on how to conduct and write a competitor analysis in a business plan , with examples.

Let’s get started and first understand the meaning of competitive analysis.

What is Competitive Analysis?

A competitive analysis involves collecting information about what other businesses in your industry are doing with their products, sales, and marketing.

Businesses use this data to find out what they are good at, where they can do better, and what opportunities they might have. It is like checking out the competition to see how and where you can improve.

This kind of analysis helps you get a clear picture of the market, allowing you to make smart decisions to make your business stand out and do well in the industry.

After having a brief knowledge of what a competitive analysis is, let’s understand how to conduct it:

How to Conduct a Competitive Analysis?

• Identify your direct and indirect competitors
• Study the overall market space
• Prepare a competitive framework
• Take note of your competition’s strategies
• Perform a SWOT Analysis of your competitors

1. Identify Your Direct and Indirect Competitors

First things first — identify all your business competitors and list them. You can make the final list later, but right now jot down all the competitors including new competitors.

Explore your competitors using Google, social media platforms, or local markets. Then differentiate them into direct or indirect competitors. And then distinguish them into direct or indirect competitors.

Direct competitors

Businesses offering the same products or services, targeting a similar target market , are your direct competitors.

These competitors operate in the same industry and are often competing for the same market share.

Indirect competitors

On the other hand, indirect competitors are businesses that offer different products or services but cater to the same target customers.

While they may not offer identical solutions, they compete for the same customer budget or attention. Indirect competitors can pose a threat by providing alternatives that customers might consider instead of your offerings.

2. Study the Overall Market

Now that you know your business competitors, deep dive into the market research. The research should be a combination of both primary and secondary research methods.

Primary research

It means being involved in getting the information directly from customers or by buying the product itself. Some examples of primary market research methods include:

• Purchasing competitors’ products or services
• Conducting interviews with customers
• Administering online surveys to gather customer insights

Secondary research

The secondary research involves utilizing pre-existing gathered information from some relevant sources. Some of its examples include:

• Scrutinizing competitors’ websites
• Assessing the current economic landscape
• Identifying technological advancements

Have a good understanding of the market at this point before you proceed with the next step.

3. Prepare a Competitive Framework

Creating a competitive framework is like charting a strategic roadmap for your business in the competitive landscape. It includes defining your USPs, market positioning, and various strategies.

Establishing your competitive positioning clarifies where your business stands among competitors.

Plan how to make your product or service stand out by figuring out ways to make it different to stand out, whether it’s through new features, better quality, or excellent customer service.

Craft unique value propositions that resonate with your target audience, communicating the benefits of choosing your offerings. This framework serves as a compass for crucial business decisions, ensuring alignment with your strategic positioning.

By consistently referencing this framework, your business can effectively meet customer needs, fostering satisfaction and loyalty through tailored products, services, and interactions.

4. Take Note of Your Competition’s Strategies

By stepping into your competitors’ research, you will learn what strategies they use to market their products or services and how they engage with their customers.

This will motivate you to do something more for customers and give you an idea of what your consumers like.

Start by analyzing their marketing strategies, such as sales and marketing channels, promotional activities, and branding strategies. Understand how they position themselves in the market and what USPs they emphasize.

Evaluate their pricing strategies and offerings, and keep an eye on their distribution channel to better understand your competitors. For example, here are the pricing strategies of a barber shop and its competitors:

This information allows you to make informed decisions about your strategies, helping you identify opportunities for differentiation and improvement.

5. Perform a SWOT Analysis of Your Competitors

You would love to know the opportunities and threats of your business, right? To be prepared for it when the time comes.

Well, conducting a SWOT analysis is like the same, it is more about getting to know about your strengths, weaknesses, opportunities, and threats. It also helps you understand your competitive edge in the market.

Whereas strengths and weaknesses focus on internal aspects of your company — opportunities and threats examine the external factors related to the industry and market.

Things to include in your SWOT analysis are:

It includes the positive features of your internal business operations. For example, it might include a strong brand, skilled workforce, innovative products/services, loyal customer base, etc.

It includes all the hindrances of your internal business operations. For example, it might include limited resources, outdated technology, weak brand recognition, inefficient processes, etc.

Opportunities

As the name says, it is all about the opportunities that will come your way in the near or far future. It is mainly about the external factors related to the market or industry trends.

For example, it might include emerging markets, technological advancements, changing consumer trends, profitable partnerships in the future, etc.

You should include any external factor that poses a challenge or any risk for your business in this section. For example, it might include intense competition, economic downturns, regulatory changes, or any advanced technology disruption.

These were the elements to help you conduct the competitive market analysis. Let us now go through how to write it in a business plan.

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How to Write Competitive Analysis in a Business Plan

1. determine who your readers are.

Know your audience first, because that will change the whole context of your competitor analysis business plan.

The competitive analysis section will vary depending on the intended audience is the team or investors.

Consider the following things about your audience before you start writing this section:

Internal competitor plan (employees or partners)

Objective: The internal competitor plan is to provide your team with an understanding of the competitive landscape.

Focus: The focus should be on the comparison of the strengths and weaknesses of competitors to boost strategic discussions within your team.

Use: It is to leverage the above information to develop strategies that highlight your strengths and address your weaknesses.

Competitor plan for funding (bank or investors)

Objective: Here, the objective is to reassure the potential and viability of your business to investors or lenders.

Focus: This section should focus on awareness and deep understanding of the competitive landscape to persuade the readers about the future of your business.

Use: It is to showcase your market position and the opportunities that are on the way to your business.

This differentiation is solely to ensure that the competitive analysis serves its purpose effectively based on the specific needs and expectations of the respective audience.

2. Describe Competitive Advantage

One of the most important things in the competitive analysis is to know your competitive advantage and gain insight into how you are a better option than competitors.

Your competitive analysis should pinpoint the competitive advantage based on the competitors’ product line or service and market segment, pricing, and other such situations. Some of the points you might include in this section are:

• Product/service differentiation in terms of quality or innovation
• Cost leadership or competitive pricing
• Brand reputation
• Customer service excellence
• Diverse and effective marketing strategy

3. Explain your strategies

Your competitor analysis section should not only highlight what opportunities or threats your business has. It should also mention that what will be the strategies to overcome those threats or capitalize on the opportunities.

It could be for taking a top-notch quality for your products or services, exploring the unexplored market segment, or having creative marketing strategies.

4. Know the pricing strategy

To understand the pricing strategy of your competitors, there are various aspects you need to have information about. It involves knowing their pricing model, evaluating their price points, and considering the additional costs, if any.

One way to understand this in a better way is to compare features and value offered at different price points and identify the gaps in competitors’ offerings.

Once you know the pricing structure of your competitors, compare it with yours and get to know the competitive advantage of your business from a pricing point of view.

Competitive analysis example

Need help writing the competitive analysis section of your business plan? Here’s the barbershop competitive analysis example to help you get started.

1. List of competitors

Direct & indirect competitors.

The following retailers are located within a 5-mile radius of J&S, thus providing either direct or indirect competition for customers:

Joe’s Beauty Salon

Joe’s Beauty Salon is the town’s most popular beauty salon and has been in business for 32 years. Joe’s offers a wide array of services that you would expect from a beauty salon.

Besides offering haircuts, Joe’s also offers nail services such as manicures and pedicures. In fact, over 60% of Joe’s revenue comes from services targeted at women outside of hair services. In addition, Joe’s does not offer its customers premium salon products.

For example, they only offer 2 types of regular hair gels and 4 types of shampoos. This puts Joe’s in direct competition with the local pharmacy and grocery stores that also carry these mainstream products. J&S, on the other hand, offers numerous options for exclusive products that are not yet available in West Palm Beach, Florida.

LUX CUTS has been in business for 5 years. LUX CUTS offers an extremely high-end hair service, with introductory prices of $120 per haircut.

However, LUX CUTS will primarily be targeting a different customer segment from J&S, focusing on households with an income in the top 10% of the city.

Furthermore, J&S offers many of the services and products that LUX CUTS offers, but at a fraction of the price, such as:

• Hairstyle suggestions & hair care consultation
• Hair extensions & coloring
• Premium hair products from industry leaders

Freddie’s Fast Hair Salon

Freddie’s Fast Hair Salon is located four stores down the road from J&S. Freddy’s has been in business for the past 3 years and enjoys great success, primarily due to its prime location.

Freddy’s business offers inexpensive haircuts and focuses on volume over quality. It also has a large customer base comprised of children between the ages of 5 to 13.

J&S has several advantages over Freddy’s Fast Hair Salon including:

• An entertainment-focused waiting room, with TVs and board games to make the wait for service more pleasurable. Especially great for parents who bring their children.
• A focus on service quality rather than speed alone to ensure repeat visits. J&S will spend on average 20 more minutes with its clients than Freddy’s.

While we expect that Freddy’s Fast Hair Salon will continue to thrive based on its location and customer relationships, we expect that more and more customers will frequent J&S based on the high-quality service it provides.

2. Competitive Pricing

John and Sons Barbing Salon will work towards ensuring that all our services are offered at highly competitive prices compared to what is obtainable in The United States of America.

We know the importance of gaining entrance into the market by lowering our pricing to attract all and sundry that is why we have consulted with experts and they have given us the best insights on how to do this and effectively gain more clients soon.

Our pricing system is going to be based on what is obtainable in the industry, we don’t intend to charge more (except for premium and customized services) and we don’t intend to charge less than our competitors are offering in West Palm Beach – Florida.

3. Our pricing

• Payment by cash
• Payment via Point of Sale (POS) Machine
• Payment via online bank transfer (online payment portal)
• Payment via Mobile money
• Check (only from loyal customers)

Given the above, we have chosen banking platforms that will help us achieve our payment plans without any itches.

4. Competitive advantage

5. SWOT analysis

Advantages of a Competitive Environment

Somewhere we all think, “What if we had no competition?” “What if we were the monopoly?” It would be great, right? Well, this is not the reality, and have to accept the competition sooner or later.

However, competition is healthy for businesses to thrive and survive, let’s see how:

1. It pushes you to innovation and improvement

In the competitive environment, a businessperson might get a new idea to bring innovation to the market to keep their products and services trending. This way innovation is promoted.

2. Competition validates your idea

Having a good idea becomes valid when others are developing similar products or services. A competitive market confirms that there is a market for your product and service. It also implies that the expenses of marketing and educating your target customers might likely decrease.

3. Efficiency and cost control

Businesses competing with each other get the motivation to operate efficiently to reduce costs and offer competitive prices. This thing for more sales benefits both businesses and customers.

4. Market responsiveness

A competitive environment forces businesses to be quick to adapt to market changes and customer demands. Companies need to adapt quickly to stay relevant and meet consumer preferences.

Competitive Analysis is critical, but don’t go overboard

Whether you are starting a new business or have an experience in the same field, gaining insight from your competitors will always be beneficial for your business.

Remember: Competitive analysis is essential for your business, but you can not assume all things positive on your side. Be realistic and practical while both conducting and writing this section.

Not only competitive analysis, but the whole business plan is necessary for any business to stay on the path. It will be your guide whenever your business is in any problem.

For assistance, you can visit our business plan writing guide . Additionally, we wish you all the luck in your competitive analysis journey.

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Frequently Asked Questions

Is swot analysis a competitive analysis.

SWOT analysis is a component of a competitive analysis, not the whole competitive analysis. Competitive analysis covers a broad topic of analyzing competitors and knowing the competitive advantage.

What Tools Can I Use for Competitor Analysis?

Executing a thorough competitor analysis requires the use of various tools to collect and analyze data. Here are some tools you can consider:

• Google Alerts
• Social media analytics
• Google Trends
• Google Analytics
• Competitors’ website

What are the 5 parts of a competitive analysis?

The main five components to keep in mind while having a competitor analysis are:

• Identifying the competitors
• Analyzing competitor’s strengths and weaknesses
• Assessing market share and trends
• Examining competitors’ strategies and market positioning
• Performing SWOT analysis

What is the difference between market analysis and competitive analysis?

Market analysis involves a comprehensive examination of the overall market dynamics, industry trends, and factors influencing a business’s operating environment.

On the other hand, competitive analysis narrows the focus to specific competitors within the market, delving into their strategies, strengths, weaknesses, and market positioning.

About the Author

Vinay Kevadiya

Vinay Kevadiya is the founder and CEO of Upmetrics, the #1 business planning software. His ultimate goal with Upmetrics is to revolutionize how entrepreneurs create, manage, and execute their business plans. He enjoys sharing his insights on business planning and other relevant topics through his articles and blog posts. Read more

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What Is Competitor Analysis? Definition + Step-by-Step Guide

Discover what goes into competitor analysis, how it benefits your business, and the steps to conducting a competitor analysis.

What is a competitor analysis?

A competitor analysis, also called competitive analysis and competition analysis, is the process of examining similar brands in your industry to gain insight into their offerings, branding, sales, and marketing approaches. Knowing your competitors in business analysis is important if you’re a business owner, marketer, start-up founder, or product developer.

Benefits of conducting competitor analysis

A competitor analysis offers several benefits, including: 

Understanding industry standards so that you can meet and exceed them   

Discovering untapped niche markets   

Differentiating products and services

Fulfilling customers’ desires and solving their problems better than competitors

Distinguishing your brand

Standing out in your marketing 

Measuring your growth 

How to do a competitor analysis 

The sections below provide a competitor analysis framework for evaluating your industry’s competitive landscape. Return to this framework regularly and apply the insights to develop your business.

1. Find out who your competitors are. 

Start by reviewing your own business values, goals, branding, products, and services. That way, you can easily identify existing brands that target customers might choose over yours.  

Next, turn to Google. Type in your product name or category. What brands and companies come up when you search "hydrating lipstick", for example? What comes up when you search social media channels for relevant hashtags or keywords?

Using the information you gathered, make a list of up to 10 brands whose offerings most resemble yours and present your target customers with comparable alternatives. Identify potential direct competitors (those who sell a similar product to a similar audience) and indirect competitors (those who sell a different product to a similar audience).

2. Analyze your competitors and their business structures. 

By examining how competitors structure their businesses, you can gauge how equipped they are to grow, gain market share, and earn customer loyalty in your target market. Review each competitor’s website and social media profile to gather the following information: 

How large is the company, in terms of the number of leaders and employees?

How many years has the company been in operation? 

What job openings do these companies list on Glassdoor, Indeed, or LinkedIn? What are their areas of expansion?

For publicly traded companies, you may be able to review their annual reports and gain insight into how much revenue they’re generating, their debt and liability, and other performance metrics.

3. Evaluate your competitors and their value propositions. 

A value proposition is a short statement that summarizes the benefits of a product and why a customer would choose it over competing products . A value proposition often looks something like the following: We help [target customer] do [outcome, benefit, experience] by doing / offering [product or service].  

In this section, you will understand competitors’ value propositions in order to ensure your product or service stands out in the marketplace. Review major competitors’ site copy, particularly on the "About" or What We Do" pages, as well as analyzing any blogs and stories on their website. Answer these questions for each competitor: 

What problems and pain points do competitors’ products solve? 

What desires do the products fulfill? 

What benefits or outcomes does the product deliver for customers?

What data do they cite to support their claims about products’ benefits?

What pricing structure do competitors use? 

4. Evaluate your competitors’ marketing efforts.

Evaluate how competitors position themselves in the marketplace. This will allow you to create a marketing strategy that gets your brand in front of your target audience. 

For each competitor, answer these questions: 

What social media influencers does this company partner with to leverage their authority, authentic content, and personal connections to target customers?  

What affiliate marketing or brand ambassador programs does this company offer to leverage the recommendations of satisfied customers? 

What kind of digital or traditional paid advertising presence does this company have?

On what marketing channels do competitors publish organic content, including websites, landing pages, social media platforms, and email? 

What type of content do you see, including articles, videos, ebooks, reports, commercials, and digital ads?  

Read more: Marketing Strategy: What It Is and How to Create One

5. Audit your competitors’ brand identities.

Get to know your competitors by auditing their brand identities and getting a sense of why customers might feel connected (and loyal) to that brand.

For each competitor, answers these questions: 

If this company were a person, how would you describe its personality? 

What words, phrases, tone, and style does this company use in its messaging?  

What values do competitors communicate through their messaging? 

How would you describe the visual elements of this company’s branding? And how do those elements correspond to the brand’s values, voice, and personality? 

What emotions do the brand elements evoke in customers? 

Read more: What Is a Brand Strategy? And How to Create One

6. Follow each competitor’s customer journey. 

Study the customer journeys that your competitors have set up to nurture and convert customers. Your goal is to gauge how seamless, integrated, and logical it is to go from the first touchpoint to making a purchase and beyond.   

Start by following your competitors on social media, subscribing to them via email, and purchasing products and services to experience each customer journey for yourself. 

As you experience the customer journey for each competitor, gather information on the following: 

What are the different touchpoints along this company’s customer journey?

What elements make it easy to keep moving along the customer journey? 

What calls to action and instructions are there to make it clear how to proceed?

What kinds of content educate and entertain you at each touchpoint?

What elements create friction or make it difficult to advance to the next step?

What do you experience after subscribing or making a purchase? Do you find customer support, upsells, and access to a community? 

7. Examine audience engagement. 

In this step, you will scour competitors’ customer reviews, reactions, and comments on their social media posts, social media mentions, media appearances, and even employee reviews on job sites to understand the perception of competitors in the marketplace. With this information, you can strategize how to garner a positive reputation for your brand, learn from competitors’ mistakes and challenges, and work to avoid any pitfalls yourself. 

For each competitor, explore the following:

How do followers and subscribers interact with this company’s public content?

What is the general public sentiment regarding this company, based on mentions, product reviews, and social media likes and comments? Include praise as well as complaints. 

What experiences do employees have, based on reviews on job sites like Glassdoor and Indeed? 

Share of voice measures how much of the market your brand owns compared to competitors. By determining the share of voice, you can gauge how visible, authoritative, and popular your brand is in the marketplace.

8. Conduct a SWOT analysis of your competition.

A SWOT analysis is a classic exercise for identifying the Strengths, Weaknesses, Opportunities, and Threats that exist within the competitive landscape. Conduct a SWOT analysis of your competitors to consolidate everything you’ve learned into a succinct story.

What strengths do you see in competitors’ branding, marketing, customer journeys, and products?

What weaknesses do you see in competitors’ branding, marketing, customer journeys, and products?

What opportunities do you see for your business to capitalize on?

What is your competition doing that might pose a threat to your business?

You can also list the strengths and weaknesses of your business as it currently stands and compare them side-by-side with those of competitors. 

For more on SWOT analysis, watch this video from the Business Strategy Specialization:

How to use competitor analysis 

Once you’ve conducted a competitor analysis, your next step is to apply the insights to your business. Use the following prompts to differentiate your brand, products, and services from competitors and gain market share:

What product features can you add that differentiate your product from competitors?

What pricing strategy can you use to attract new customers to your offerings?

What design features can you add to your brand to make it stand out?

How can you compose a value proposition that stands out from competitors? We help [target customer] do [outcome, benefit, experience] by doing / offering [product or service].  

How can you design a more seamless, frictionless customer journey that leads consumers to make a purchase and become loyal brand ambassadors? 

How can you create content that improves on that of your competitors, including covering new topics, addressing ignored pain points, recommending new solutions, and offering more exciting experiences?  

How can you improve your social media strategy to reach new potential customers?

What approaches can you take on marketing channels where your competitors have a presence to distinguish your messaging and present your offerings as the best choice?

On which marketing channels do your competitors not (yet) have a presence? What steps can you take to establish and grow a presence on those channels? 

Competitor analysis key takeaways

Remember that conducting a competitor analysis is a crucial step in developing your business. It can help you differentiate your brand and present your products and services as the best on the market. Return to your competitor analysis efforts regularly, such as every quarter, six months, or year, to account for shifts in competitors’ tactics and new competitors that arrive on the scene. Always look for ways to give your brand and products a competitive edge. 

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A Guide to Competitive Analysis: It’s Not Just about Competitors

By Joe Weller | April 16, 2018 (updated February 13, 2024)

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If you were running a cross-country marathon, wouldn’t you want to know something of the terrain and expected weather conditions before you began? The same principle of preparation applies when starting and continuing a business. It’s not enough to focus on your own production and financial goals: You need to understand what’s happening around you, how others create goods or services, the economic forecast, changes in rules and regulations, and more. In other words, you need to conduct a competitive analysis. The thought of searching for and digesting the required information may seem overwhelming, but we make it easy.

In this article, we explain how to focus your analysis by first deciding what questions you want answered. Learn how to find current and potential competitors and how many of them you need to review. Then, we cover the specific aspects of your competitors that you need to consider as well as where to find more information about them. Marketing experts weigh in on how to maintain focus during analysis. We also offer free, downloadable competitive analysis templates to start you on your own information gathering and analysis.

What Is Competitor Analysis?

Competitor analysis (CA) is a process of identifying competitors and gauging their business and marketing strategies to understand both their strengths and weaknesses and those of your own business. Competitive analysis provides a higher-level perspective of the entire marketing landscape and competitive intelligence.

“Competitive analysis is the process of analyzing all collected information to derive some insight for reducing risk and making better decisions,” explains competitive intelligence expert and author Babette Bensoussan .

“It is about your broader competitive environment,” she says. “I always remind my clients that competitors make up only one element of a business’s competitive environment. Other elements include government, technology, buyers, and suppliers, to name a few that impact how well you can compete.”

What Is the Purpose of a Competitive Analysis?

Researching your competitive landscape is essential to business growth and survival, and helps you offer better products or services to customers. You should gain an understanding of how customers view your company, what you’re doing right, and what you’re doing wrong. Therefore, competitive analysis forms a crucial part of marketing plans to help you understand what differentiates your product or service. Particularly when applying for funding, competitive analysis provides valuable insight into business plans. However, competitive analysis offers much more:

• Branding possibilities
• Insight into how competitors design products and messages
• SEO possibilities
• CRO (conversion rate optimization)
• GTM strategies
• User experience (UX) advantages of your and others’ products and websites
• Gaps in the market
• New products and services to develop
• Market trends

According to a Conductor survey , 60 percent of marketers don’t feel proficient in competitive analysis. Many don’t practice it on a regular basis. Knowledge derived from these exercises is critical, and you need to assess competition regularly. Nevertheless, marketing departments often skip competitive analysis, which leaves them with a fragmentary understanding of the landscape and competitors. Being proactive can help you anticipate and prepare for competitor developments and provide you with the agility to take advantage of changes.

According to Bensoussan, “In today’s world of constant change and information overload (whether the information be real or fake), it is critical for any business person to understand the competitive landscape and the forces that impact the profitability and viability of a business.”

What Should Be Included in a Competitive Analysis?

In most cases, a competitive analysis contains a few basic sections, which may vary depending on the size and form of your company and the focus of your analysis:

• A list of your main competitors
• An overview or what you know about them
• Who their target customers are
• A list of their products or services
• What media they use to market their goods and services
• Their current and past marketing strategies
• Their value proposition and effectiveness
• An analysis of all of the strengths and weaknesses of your competition (and your own company)
• An overview of the strategies being used by the competition to achieve their objectives
• An overview of the market and projections for the future

How to Prepare for a Competitive Analysis

One of the crucial prerequisites for a successful competitive analysis is an open mind. Check your beliefs at the door — what you think about your company, your customers, or your competitors isn’t necessarily true. That can be a good thing.

In addition, it is vital to understand why you are conducting an analysis. What are your goals for the business? What are your goals for this analysis? “Always, always be very clear as to what the decision you will be making is all about,” advises Bensoussan. “If you are not clear about your decision, then you will never know if you have good competitive analysis or just some more information.”

She offers these two questions as examples of how different the impact of each answer can be: “Tell me who’s who in the [manufacturing] of zippers?” versus “Should I enter the zipper-manufacturing industry, and can I achieve a return on investment of, say, 15 percent in three years?”

“Which question would help you the most in delivering good quality CA? Which outcome do you think would provide the most value?” Bensoussan asks.

Companies often enlist the help of outside consulting firms dedicated to conducting competitive intelligence research. Guidance on competitive intelligence support, such as database information, software platforms for market program tracking, and more is available through the Society of Competitive Intelligence Professionals .

Competitor Analysis Frameworks

Over the decades, marketing gurus have developed or advocated several competitive analysis frameworks. Here are six well-known methods to consider.

• Porter’s Five Forces Model: First published in 1979 by Harvard Business School professor Michael Porter, the Five Forces model provides a view beyond competitors to factors in your industry landscape that may threaten or strengthen your position. The Five Forces include the following:

• Potential New Entrants: Consider how much money, time, and effort it would take for a company to displace you.
• Competitive Rivalry: Determine who your competitors are, who the closest competitors are, and their products, prices, and quality. Fewer rivals mean more opportunity for your unique qualities to shine; many rivals mean more competitors to steal your customers and potentially better deals to lead customers elsewhere.
• Suppliers: The more potential suppliers you have, the better for you. Consider how having fewer suppliers might impact your operation.
• Buyers: If you have many customers, you have the power. Otherwise, buyers can negotiate more advantageous deals elsewhere or find sources other than yours. Consider how you would treat that situation.
• Substitutes (or Complements): A competitor could create a product or model that replaces yours. On the other hand, a new product or service could also complement yours, which would create a symbiotic sales situation. Complements are sometimes considered the sixth force in the model.

Porter stressed the importance of not confusing these constants with temporary disruptions, such as technological innovations or government interventions in industry.

You can download the Five Forces model below to answer your own questions about an industry or business proposition.

Download Five Forces Model

Excel  |  PDF

Industry Life Cycle Overview: Both industries and individual products have life cycles, which reflect the state of sales, whether robust or diminishing. Understand which stage of the life cycle your industry, company, or product is in to help target your marketing efforts. Product life cycles contain such stages as these:

• Introduction: At the introductory stage, a new industry or product is not well known or proven. It is usually marketed to a few early adopters. Because resources focus on product development, testing, and refinement, few or no profits accrue. Marketing focuses on explaining the product, creating awareness around it, and establishing a niche.
• Growth: As awareness grows and the industry or product becomes established, profits may also grow. However, in the growth stage, rival products may also appear. Although improvements require funds, production efficiencies may also develop. Some products have only a short growth phase. For example, a particular fashion may last for only one season. Other products experience a long or extended growth phase, such as software products, which continue their usefulness through upgrades. During the growth stage, marketing centers on differentiating the product, so it stands out from competing products.
• Maturity: In the maturity stage of a product or industry, sales may expand, but at a less accelerated rate. Fewer competitors may dominate the market and may attempt to differentiate on quality or increase sales by touting low costs.
• Saturation: You reach the saturation stage when every customer who could buy the product already owns the product. A lack of innovation or competition from a superior product could result in saturation.
• Decline/Termination: Industries and products decline for several reasons. Innovations may overtake them and render them obsolete. Businesses and product lines may fail to upgrade and innovate. At the decline or termination stage, companies may fold, continue in a smaller market, or merge with larger, successful businesses.  

Strategic Groups Analysis: You perform strategic groups analysis on companies within a business sector, such as automobiles, to see how they vie for their share of consumer expenditure. By dividing companies into strategic groups, you can understand how businesses of different sizes behave in the marketing landscape. Businesses within groups tend to be competitors, whereas businesses in other groups are related but not competitive. For example, running shoes and high-end women’s dress shoes are in different groups. Analyzing companies in this way can also reveal other significant information: direct competitors and their basis for competition; if and how a company can move to another group; and strategic problems and opportunities. Strategic groups are usually plotted on an x-y axis, where two highly relevant criteria form the axes. Here are some examples of criteria:

• Brand ownership
• Company size
• Capacity utilization
• Cost structure
• Geographical market segmentation
• Marketing activities
• Ownership structure
• Sales channels
• Product diversity
• Product quality
• R&D capability
• Vertical and horizontal integration

First, plot the companies where you think they belong on the graph. Now, with all companies plotted, create groupings. If you want, you can use larger or smaller circles to indicate market share. To gain greater insight, perform a Five Forces analysis on them, or consider the mobility barriers that prevent companies from shifting to other strategic groups.  

SWOT: Perhaps one of the most commonly addressed marketing analyses is SWOT (strengths, weaknesses, opportunities, and threats). In essence, SWOT represents what competitors do and do not do well. As you look at SWOT for competitors, also consider it for your own products and services.

• Strengths: What do they do better than you? What are they known for? Is their pricing, inventory, convenience, and level of service better than yours?
• Weaknesses: How do they fall short of your company’s standards? Can you leverage their shortcomings to improve your standing with customers?
• Opportunities: What in your competitors’ landscape can you exploit to your advantage?
• Threats: What in your competitors’ landscape threatens their business position?

Note that strengths and weaknesses focus on internal characteristics, while opportunities and threats concern external forces. SWOT can be performed separately, but it may provide a useful frame for studying a business’ products and services, marketing, and sales.  

Competitive Array: Competitive arrays, also known as competitive matrices , provide a way to quantify characteristics that may be unquantifiable. For example, if company A sells 500 widgets and company B sells 250, it’s clear which company sold more. But how do you quantify the attractiveness of online and print media or innovation? Creating the competitive array can be an individual or group exercise. To start, list your competitors across the top of your writing surface. In the left-most column, list important characteristics. Next, create a column for weighting the importance of each characteristic so that the sum of the characteristics totals one. The higher the weighting, the more important the characteristic (you may have a few characteristics with the same weight). Next, grade each competitor for each characteristic on a scale, such as from one to 10. Now, multiply the grade by the corresponding weight.  

Competitive Value Proposition Analysis: The characteristics of a value proposition are exclusivity, clarity, and credibility. This method concerns how unique the product or service is, how clearly the product message is conveyed, and whether the message is credibly supported by evidence, such as testimonials, statistics, or test results. Because customers remember only a few key advantages of your product from your media promotion, the main value proposition must be correct and clear and mesh with your actual competitive advantage. To figure out how to differentiate your company, you must determine how competitors differentiate themselves from each other. POPs (points of parity), PODs (points of difference), and POIs (points of irrelevance) help you dissect value propositions.

• Points of Parity (POPs): These are elements of customer benefit that both you and your competitors offer.
• Points of Difference (PODs): These are features of customer benefit that you offer but competitors don’t. Keep in mind that not every point of difference is significant to consumers.
• Points of Irrelevance (POIs): These are characteristics that customers don’t care about.

Your unique value proposition (differentiating characteristics) doesn’t need to appeal to every customer. Don’t make your value proposition too general. You can’t be all things to all customers, just as you can’t do what your competitors are doing.

Otherwise, there's no differentiation. You end up being like teenagers, everybody in the same jeans," says Sonia Schechter, Chief Marketing Officer of Marxent , a provider of virtual reality and augmented reality apps for furniture retailers. Therefore, target your message.

Discover your points of parity by using our POP template.

Download Points of Parity Template

Excel  |  Word  |  PDF

Who Are Your Competitors?

As a first step in competitive analysis, marketing guides typically suggest determining who your competitors are. Competitors can be divided into groups of direct competitors, indirect competitors, and future competitors.

• Direct Competitor: These are companies who sell a direct substitute for your product, operate in the same geographic area, and/or offer the same goods (such as groceries) to the same market. Ask who your customers would buy from if you weren’t in business.
• Indirect Competitor: These are companies in the same geographic area whose products occupy the same general, but not specific, category as your own (e.g., a general bakery versus a designer cake store). Indirect competition satisfies the customer’s need for a particular product or service, although that product or service may be different from yours. Similar products operating in different market segments do not represent direct competitors. For example, a high-end seafood restaurant doesn’t compete with a burger place.
• Future Competitor: Future competitors may currently be indirect competitors who change and expand solutions. In the bakery example, the general bakery could hire a high-end designer to compete with the specialty cake maker. Or, the designer cake store could branch out into breads and muffins.

It may be difficult at first to envision what types of organizations you need to analyze and whether you need to analyze all competitors.To identify competitors, ask yourself who your customers would buy from if your product did not exist. Perhaps even more important, consider who your customers think your competitors are. How many competitors you review depends: If only a few companies do what you do, analyze everyone. If you have many competitors, use Pareto analysis to focus on the critical 20 percent. Larger businesses may analyze the top 10, whereas a small business can focus on three. Disregard online competitors unless you plan to sell online.

‌ Download Pareto Chart Template - Excel

How to Find Current Competitors

Some competitors may seem obvious, but sleuthing can reveal challengers you weren’t aware of.

• Google search for a product or service similar to yours. Consider the companies in paid ads and organic returns.
• Try SEMrush to check which domains are using which keywords.
• Ask your current customers who they would choose besides you.
• Check Alexa, Google Trends, or SimilarWeb for general estimates on the popularity of domain names and keywords.
• Review Dun & Bradstreet for new incorporations.
• Consult Derwent for new patent information.
• See who has booths at trade shows.

How to Find Potential Competitors

While you consider the current playing field, you must also keep your eye on what’s coming around the corner. These are the future new entrants in your niche. Consider who might start a  business that would compete with yours. New competitors can be found in related markets, related technologies, or related products. Companies from other geographical areas with similar products may begin to sell in your area, and former employees or managers can start their own companies based on the themes of your business. In addition, consider the following conditions that may encourage competition:

• A company gains competitive advantage.
• Buyers are dissatisfied with suppliers.
• An unmet demand for goods exists.
• Few major barriers to entry exist.
• The industry offers high profit margins.
• The industry offers unrealized growth potential.
• Competitive rivalry is not intense.

It’s Not All about Competitors ( Competitive Doesn’t Always Mean Competitor )

Depending on what your product or service is and where it is in its life cycle, a competitor focus may not be optimal. For example, for emerging technologies, no true competitor may exist.

“Looking too closely at competition is a massive distraction,” Schechter notes. “If you’re selling a commodity or established product, such as a drugstore, which sells the same thing anywhere, you’d be looking at specific issues, like price, location, and assortment.”

Schecter says marketers themselves often don’t understand that what the competition is doing is not important: “Successful marketing is how you define yourself in the landscape. People don’t care about a feature-by-feature description, or even one feature. They buy the package. They like you. You’re different or you’re solving a particular problem. A new business must define and lay out the landscape for the customer.”

To succeed, understanding what customers want is key. “Marketers have nuanced detail, and customers don’t care about that detail,” Schechter continues. “But, you have to listen to their questions and engage in dialogue with them to gain real understanding,” she points out. She cites Apple’s promotion of the camera in the first iPhone as an example of marketers understanding what — out of thousands of potential functions — was important to consumers. “B2B marketing is the same. It’s about listening to customers, figuring out how they’re shopping, and trying to see through their eyes,” Schechter emphasizes.

“Obsessing over competition can get you off track. If you’re listening to customers, you’ll build the right product. But you don’t need to build your dreams on other people’s ideas,” she concludes.

Where to Find Information for a Competitive Analysis

Remember that every department of your business is a potential source for information, including the following areas:

• Sales: Questions for potential, current, and lost customers
• Research and Development: New patents
• Purchasing: Suppliers
• Marketing: Customers and other consumers

Once you’ve determined who your competitors are and what you want to learn about them and from them, you need to go information hunting:

• Visit offices or brick-and-mortar stores. What do they look like? Who’s there?
• Get financial and organizational information from public filings and from sources like Hoovers, Manta, and Dun & Bradstreet.
• Monitor PR Newswire for new developments and changes.
• Some marketing platforms may actually include information about your competitors.

Interviews and Research Surveys

Interviewing competitor customers and consumers who know little about your business is important to overcoming your preconceptions about the business landscape. You probably have specific questions in mind, but here are the basics:

• Why are you shopping for a solution?
• What were the main reasons you chose the company you did?
• Ranked from most important to least important, what are your five shopping criteria?

Media Scanning or Competitor Content Analysis

You can learn much about competitor products and messaging by scanning media. Media doesn’t just include online content (web pages, tweets, and Facebook posts) — it also includes such traditional marketing collateral as white papers, case studies, and data sheets. Moreover, consider reference materials, such as LexisNexis and Hoovers, and trade, business, or news publications for ads, news stories, and press releases. Media and content can reveal not only new products and new branding, but also new positioning and segmentation strategies, pricing, target markets, and promotion strategy.

What Information to Search for in Competitive Analysis

The approach to analysis depends on the questions requiring answers. To organize your analysis, divide it into three aspects: product or services, marketing, and sales. Each aspect contains its own questions and means of analysis.

Download Competitive Analysis Checklist

Products and Services

Your understanding of products and services must be thorough. Investigate the complete product or service line. Try to understand who your competitors’ customers are and what they need. Look at their pricing strategy and see if it differs for online and brick-and-mortar stores. Also, consider how they differentiate from their competitors.

Tracking competitor sales processes can involve more legwork. For public companies, SEC filings provide some financial information about growth or contraction, but, for private companies, information is less readily available. Information about sales channels may be easy to find through a look in the phone book or online. You can also gather details about the sale process by asking current customers why they chose your product over others. You can also acquire valuable information by following up even after you lose a sale in order to understand the customer’s thinking. What do their partner resales programs look like? What are their revenues versus sales volume?

Marketing Efforts in Competitive Analysis

What does the competitor marketing plan entail? How do competitors invest marketing efforts? What can you do even better? A variety of approaches can help you define competitor marketing strategy.

When you identify marketing assets, take a reasonable sample of items — no need to review all of them. Just remember to keep samples consistent among competitors. Also, when reviewing items, consider the quality of the collateral. It should appear professional, with no typos, and in the formal, professional, idiomatic voice. In addition, a solid library of resources, such as consistent blog posts, whitepapers, case studies, videos, webinars, and podcasts may point you to themes and leads you should follow.

E-Marketing Strategy Competitive Analysis

Few businesses today can function without a web presence that helps generate traffic and inquiries or purchases. Some statistics say that prospective buyers visit a website as many as nine times before purchasing and, depending on the product, visit multiple sites before purchasing. Forrester research after 2010 suggests potential customers visit three sites on average before buying. The more sites visited, the more money the customer intends to spend.

Therefore, understanding how your site compares to your nearest competitors can be helpful. To drive eyes to websites, online purveyors use search engine optimization (SEO) to employ the keywords most likely to garner high search ratings in Google (and other search engines). Marketers frequently also use SEM (search engine marketing) to promote a business or product by increasing visits to a website through paid keywords. Look at how saturated their content is with keywords and where they use keywords, whether in H1 and H2 tags, page titles, content, or links. Also, look at the difficulty level of their keywords.

Consider the usability of the steps in the sales funnel as well as the navigation. What do the  landing pages say? Also, look at backlinks (i.e., links from other pages to your competitor’s page) to your web page. See how many backlinks exist — and from which pages — to understand if this is something you can improve for your website.

Structure is important, but quality content also matters. Online marketing collateral appears as blogs, white papers, ebooks, case studies or user stories, videos, webinars, podcasts, and more. But words and pictures themselves are not valuable if they don’t offer any unique information or concise approaches to existing knowledge. Check whether content is shared and which topics attract attention, or, conversely, what that content and those topics are linked to. What do readers comment on, if they do comment? Who else is sharing what your competitors are publishing?

Social Media

Certain social media platforms appeal to some audiences more than others. The channels a company favors can reveal clues to the demographics of their target market. Make note of what social media buttons they include on pages and where on the page they include them.

Software Tools for Understanding Online Competitors

Besides monitoring content, you can monitor the mechanics of competitor websites to glean more data about how marketing strategy and product offerings are changing. Software helps to automate these investigations for you. Following are some of the many products available:

• BuiltWith : See what platform was used to build a page.
• Ghostery : Find trackers on a website.
• SEMrush : Discover company rankings, organic keywords, AdWords, and analyses of backlinks.
• Versionista : Track web page and website changes, SEO changes, and more.
• Visualping : Monitor webpage updates.
• SpyFu : Find competitor keywords and AdWords, including AdWord and keyword variations and history.
• iSpionage : Track PPC and other keywords in competitor campaigns.
• SimilarWeb : Compare competitor websites to your own.
• Heatmaps: Use large amounts of data to provide a visual representation of how users interact with a website. Heatmaps can indicate where users click and look and for how long. Levels of intensity of activity are usually displayed through colors.
• Session Recording Tools: Record user browsing sessions. Session recording tools can yield a wealth of rich data, but raise some privacy concerns.
• Tag Management Systems: Advanced e-marketing implementations use tags to aid analysis and reporting. Tags are snippets of code that are usually added to the <head> tags of a web page.

Web Page User Testing for UX in Competitive Analysis

It’s essential to understand how consumers approach your website, especially for web-based products and marketing. Allow customers to test your site, and even view it yourself from a customer’s perspective, to help eliminate unnecessary steps and streamline your sales funnel. Doing so can also help to illuminate the opportunities for upsells and cross-sells.

Limiting the analysis to two or three competitors offers a manageable amount of insight into usability, which helps you avoid reviewer overload and confusion. For impartial results, don’t reveal to test participants which website is yours.

Ask test participants to enter words in Google or list the words and phrases they would use to find a certain product or service. Not only does this yield potentially fruitful keywords, it also indicates whether your site appears in search returns.

To get a sense of each participant’s impression, have them look at each website for five seconds and answer the following questions:

• What three words would you use to describe the site?
• What is it about? What products or services are offered and for whom?
• How does this website make you feel?

To understand their process, give participants a task to perform on each website. Ask them to answer the following questions:

• What was the worst thing about your visit to this website?
• What aspects of the experience could be improved?
• What did you like about the website?
• What other comments do you have?
• Which website did you like best and why?

How Much Data Do You Need in a Competitive Analysis?

It may seem overwhelming to sit down and search out your competitors’ business situations. That’s why setting a clear intention before you begin an analysis is so important. In addition, Babette Bensoussan advises that you don’t need to analyze everything:

“Over the years, I have learned that once you have 70 percent of the information required for your chosen analytical technique, you can proceed to the analysis,” she explains. “You never really need all the pieces of a jigsaw puzzle to tell you what the picture is. This same philosophy applies to analysis. More information may not yield better insights nor improve predictive accuracy.”

How Do I Write a Competitor Analysis Report?

The format of your analysis depends on individual choice and the audience. You may also choose to use one kind of format while you work through the analysis, and another when you present findings.

Take a sheet of paper. In the left-most column, write the names of your closest competitors. Across the top of the page, list the main attributes of each product, such as target market, price, size, method of distribution, extent of customer service, prospective buyers, and so on. Then, make a check or a note for each attribute the competitor fulfils. An additional column can contain information about service or product availability, the website, a toll-free phone number, and other general information.

A competitor profile helps you make a detailed record about each competitor, and also allows you to capture snapshots of a business over time. Consider listing some of the following information:

• Location of offices and factories
• Key personalities, history, and trends
• Ownership, organizational structure, and corporate governance
• Number of employees and skill sets
• Management and management style
• Compensation, benefits, and retention rates
• Plant capacity, utilization rate, age of plant, capital investment
• Product mix per plant and shipping logistics
• Products and services
• Depth of product line
• New products developed and success rate
• Research and development details
• Brands and brand loyalty and awareness
• Patents and licenses
• Quality control conformance
• Cash flow and liquidity
• Profit growth profile
• Method of growth (organic or acquisitive)
• Objectives, mission statement, growth plans, acquisitions
• Marketing strategies
• Segments served, market shares, customer base, growth rate, and customer loyalty
• Promotional mix, promotional budgets, advertising themes, ad agency used, online promotional strategy
• Distribution channels (direct and indirect) and exclusivity agreements

Here is a step-by-step process for writing a competitor analysis report:

• Write down your competitors.
• Write what you know about them already.
• Discover who their target customers are.
• Discover their pricing methods.
• Investigate their marketing strategy.
• Figure out their competitive advantage.

Download our competitive analysis landscape template to get ideas for gathering information and reporting analysis results.

Download Competitive Analysis Landscape Template

Excel  |  Word  |  PDF  | Smartsheet

Competitive Analysis for Small Businesses

Small business can be competitive. Beyond meeting financial targets, you need to understand the competitive landscape (short of allowing it to distract you) and then target a niche market.  Many of the same analyses that apply to large businesses also apply to small businesses. However, if this is your first business, or if you don’t have a marketing background, you may want to pay attention to a few aspects.

First, it is helpful to acknowledge how much or how little you know about your competitors by sketching a profile of your top two or three competitors. Next, try to learn all you can about your competition.

You can use the following template to perform a competitive analysis for your small business.

Download Small Business Competitive Analysis Template

Word    |    PDF

What Is a Competitive Analysis in a Business Plan?

Competitive analysis should play a key role in the preparation of a business plan. Particularly if you seek outside funding, your knowledge of the competitive landscape will show your understanding of your business and the market forces at play.

When starting a business, consider all the analysis questions described above, but pay particular attention to issues of growth and opportunity. Consider addressing the following circumstances:

• Whether current competitors target a specific niche or offer products to the mass market
• If, how, and why competitors are growing or reducing business
• How your company will be stronger than competitors and better able to exploit changes in the market landscape
• What you will offer customers that no one else does (your competitive advantage)

In the business plan, describe the competitive landscape as it relates to direct and indirect competitors and opportunities and risks, emphasizing your competitive advantage. This competitive analysis can form the basis for your first marketing plan.

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How to Write a Competitor Analysis for a Business Plan (with AI in 2023)

Competitor analysis is a critical component of any business plan. It helps you understand the landscape of your industry, identify opportunities for growth and differentiation, and craft strategies that take advantage of your competitors' weaknesses.

Here's a step-by-step guide on how to conduct a comprehensive competitor analysis, including how to leverage AI tools like Bizway to make the process more efficient and effective.

Step-by-Step Guide to Performing a Competitor Analysis

1. identify your competitors.

Understanding your competitive landscape begins with pinpointing who your direct and indirect competitors are.

Points to Consider

• Direct Competitors : Those who offer similar products/services in the same market.
• Indirect Competitors : Businesses targeting your customer base with different offerings.
• Utilize market research and customer feedback to list competitors.
• Identify geographical considerations - local, regional, or global competitors.

2. Analyze Their Products/Services

A thorough examination of competitors’ offerings unveils potential areas for differentiation and enhancement in your product/service line.

• Feature comparisons.
• Pricing structures.
• Unique Selling Propositions (USPs).
• Adopt a customer-centric approach to understand how consumers perceive competitors’ offerings.
• Identify gaps in their product/service lines that you could explore.

3. Assess Their Marketing Strategy

Understanding competitors’ marketing approaches aids in crafting a superior, data-driven marketing strategy.

• Target audience.
• Key messages and value propositions.
• Channel effectiveness and presence.
• Use social listening tools to gauge their social media effectiveness.
• Analyze the SEO performance of competitors’ websites.

4. Examine Their Sales Strategy

Investigating sales channels and tactics employed by competitors reveals market penetration strategies and potential areas for diversification.

• Distribution channels.
• Pricing and sales tactics.
• Customer relationship management.
• Secret shop to observe sales tactics and customer experiences.
• Review customer feedback on their purchasing experience.

5. Analyze Their Strengths and Weaknesses

Identifying what competitors excel in and fall short on enables strategic decision-making in exploiting market opportunities.

• Operational efficiency.
• Customer service quality.
• Brand reputation and loyalty.
• Conduct a SWOT analysis (Strengths, Weaknesses, Opportunities, Threats) for each competitor.
• Leverage customer reviews and testimonials to gauge reputation.

Using AI for Competitor Analysis

Automated data collection.

AI automates the harvesting of data from myriad sources, ensuring robust research while saving time.

• Use AI tools to scrape and aggregate data from competitors' websites, social media, and customer review platforms.
• Ensure the data is categorized and stored systematically for easy analysis.

Real-Time Updates

AI provides a competitive edge by monitoring and reporting real-time updates on competitor activities.

• Set up AI monitoring for specific competitor activity: product launches, PR releases, or marketing campaigns.
• Ensure to leverage real-time data to inform swift strategic adjustments.

Predictive Analytics

Predictive analytics via AI deciphers patterns and anticipates future competitor moves, positioning your business proactively.

• Leverage AI to analyze historical data for predicting future trends.
• Utilize these insights to anticipate and formulate preemptive strategies.

Using Bizway for Competitor Analysis and Business Planning

One such AI tool that can revolutionize your competitor analysis process is Bizway . Bizway is an AI-powered business planning and research app that can help you research your competitors and write your entire competitor analysis with just a few clicks. Moreover, Bizway can assist you in writing your entire business plan, saving you time and providing you with expert-level planning documents.

With Bizway, you can automate the process of generating clear, concise planning docs across all areas of business, from an SEO Content Plan to User Onboarding Plan. It also helps fill knowledge gaps in areas of business you're not well-versed in.

So, whether you're a solopreneur, a small business owner, or an aspiring entrepreneur still in school, Bizway is the AI assistant you need to take your business planning to the next level.

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©2024 Bizway Labs

How to Write the Competitive Analysis of a Business Plan

Written by Dave Lavinsky

If you are writing a business plan, hopefully by this point you’ve conducted thorough market research to identify industry trends and identified the target market for your business. Now it’s time to conduct a competitor analysis. This section is included in virtually every simple business plan template , and the information you include will depend on several factors such as how many competitors there are, what they offer, and how large they are in comparison to your company.

Download our Ultimate Business Plan Template here

What is a Competitive Analysis?

A competitive analysis is a type of market research that identifies your competitors, their strengths and weaknesses, the strategies they are using to compete with you, and what makes your business unique. Before writing this section it’s important to have all the information you collected during your market research phase. This may include market data such as revenue figures, cost trends, and the size of the industry.

Why Do You Need the Competitive Analysis?

If you are planning to raise capital, the investor will require a business plan that includes the competitive analysis section. This section will also come in handy while writing a business plan template , if your company is considering increasing prices or adding new products and services. You can use the information you find to determine how well-positioned your business is to perform in the competitive landscape.

3 Steps to Writing a Competitive Analysis

The steps to developing the competitive analysis section of your business plan include:

• Identify your competition.
• Select the appropriate competitors to analyze.
• Determine your competitive advantage.

1. Identify Your Competition

To start, you must align your definition of competition with that of investors. Investors define competition as to any service or product that a customer can use to fulfill the same need(s) as the company fulfills. This includes companies that offer similar products, substitute products, and other customer options (such as performing the service or building the product themselves). Under this broad definition, any business plan that claims there are no competitors greatly undermines the credibility of the management team.

When identifying competitors, companies often find themselves in a difficult position. On one hand, you may want to show that the business is unique (even under the investors’ broad definition) and list few or no competitors. However, this has a negative connotation. If no or few companies are in a market space, it implies that there may not be a large enough base of potential customers to support the company’s products and/or services.

2. Select the Appropriate Competitors to Analyze

Once your competition has been identified, you want to consider selecting the most appropriate competitors to analyze. Investors will expect that not all competitors are “apples-to-apples” (i.e., they do not offer identical products or services) and therefore will understand if you chose only companies that are closest in nature. So, you must detail both direct and, when applicable, indirect competitors.

Direct competitors are those that serve the same potential customers with similar products and services. If you sell your products or services online, your direct competitors would also include companies whose website ranks in the top 5 positions for your same target keyword on Google Search.

For example, if you are a home-based candle-making company , you would consider direct competitors to be other candle makers that offer similar products at similar prices. Online competitors would also include companies who rank for the following keywords: “homemade candles”, “handmade candles”, or “custom candles.”

Indirect competitors are those that serve the same target market with different products and services or a different target market with similar products and services.

In some cases, you can identify indirect competitors by looking at alternative channels of distribution. For example, a small business selling a product online may compete with a big-box retailer that sells similar products at a lower price.

After selecting the appropriate competitors, you must describe them. In doing so, you must also objectively analyze each of their strengths and weaknesses and the key drivers of competitive differentiation in the same market.

For each competitor, perform a SWOT Analysis and include the following information:

• Competitor’s Name
• Overview of Competitor (where are they located; how long have they been operating)
• Competitor’s Product or Service
• Competitor’s Pricing
• Estimated Market Share
• Location(s)
• Potential Customers (Geographies & Segments)
• Competitor’s Strengths
• Competitor’s Weaknesses

By understanding what your competitors offer and how customers perceive them, you can determine your company’s competitive advantage against each competitor.

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3. Determine Your Competitive Advantage

Perhaps most importantly, you must describe your company’s competitive advantages over the other companies in the space, and ideally how the company’s business model creates barriers to entry. “Barriers to entry” are reasons why it would be difficult for new companies to enter into or compete in the same market.

For instance, you may have a patent that provides value to your customers and makes them less likely to switch suppliers, which protects your business from potential competitors. Or, you may have more resources than the competition and thus be able to provide superior customer service.

Below is a list of areas in which you might have a competitive advantage:

• Size of the Company – Large companies have more resources and can usually offer lower prices than smaller businesses. This is a significant barrier to entry, as starting a small business and competing with a larger company may be difficult.
• Product or Service Differentiation – If your product or service is unique in some way, this will make it less likely that customers will switch to a competitor.
• Experience & Expertise – Experience and knowledge are valuable attributes that can help differentiate you from the competition.
• Location – If you are located in an area where there is high demand for your product or service, this can be a barrier to entry because competitors will not want to open new locations.
• Patents & Copyrights – Protecting intellectual property can prevent others from entering the same market and competing with your company.
• Brand Recognition – Customers are loyal to brands they have come to trust, which protects the company from new competitors.
• Customer Service – Providing excellent customer service can help you retain customers and prevent them from switching suppliers.
• Lowest Cost Offerings – If you can offer a lower price than your competitors, this makes it more difficult for them to compete with you.
• Technology – New technology that enables you to provide a better product or service than your competitors can be an advantage.
• Strategic Partnerships & Alliances – Collaborating with a company that your customers want to work with can help keep them from switching.
• Human Resources – If you have a highly skilled and talented workforce, it can be difficult for competitors to find and employ the same skills.
• Operational Systems – Strong operational systems that lead to greater efficiencies can protect your business from the competition.
• Marketing Strategy – Investing in strong marketing campaigns can make your business difficult to compete with.

For instance, you could say that your [enter any of the bullets from above] is better than your competitors because [insert reason].

The competitive landscape is one of the most important considerations in developing a business plan since it sets the stage by providing information on past and current competitors and their respective strengths and weaknesses. A strong understanding of the competitive landscape is needed before you can develop a strategy for differentiating your company from the competition. Follow the above competitive analysis example and you will be well-prepared to create a winning competitor analysis section of your business plan.

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Other Resources for Writing Your Business Plan

How to Write a Great Business Plan Executive Summary

How to Expertly Write the Company Description in Your Business Plan

The Customer Analysis Section of Your Business Plan

How to Write the Market Analysis Section of a Business Plan

The Management Team Section of Your Business Plan

Financial Assumptions and Your Business Plan

How to Create Financial Projections for Your Business Plan

Everything You Need to Know about the Business Plan Appendix

Business Plan Conclusion: Summary & Recap

Other Helpful Business Plan Articles & Templates

• Starting a Business
• Growing a Business
• Small Business Guide
• Business News
• Science & Technology
• Money & Finance
• Subscribers For Subscribers
• ELN Write for Entrepreneur
• Store Entrepreneur Store
• Spotlight Spotlight
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Copyright © 2024 Entrepreneur Media, LLC All rights reserved. Entrepreneur® and its related marks are registered trademarks of Entrepreneur Media LLC

• How to Use Your Business Plan Most Effectively
• The Basics of Writing a Business Plan
• 12 Reasons You Need a Business Plan
• The Main Objectives of a Business Plan
• What to Include and Not Include in a Successful Business Plan
• The Top 4 Types of Business Plans
• A Step-by-Step Guide to Presenting Your Business Plan in 10 Slides
• 6 Tips for Making a Winning Business Presentation
• 12 Ways to Set Realistic Business Goals and Objectives
• 3 Key Things You Need to Know About Financing Your Business
• How to Perfectly Pitch Your Business Plan in 10 Minutes
• How to Fund Your Business Through Friends and Family Loans and Crowdsourcing
• How to Fund Your Business Using Banks and Credit Unions
• How to Fund Your Business With an SBA Loan
• How to Fund Your Business With Bonds and Indirect Funding Sources
• How to Fund Your Business With Venture Capital
• How to Fund Your Business With Angel Investors
• How to Use Your Business Plan to Track Performance
• How to Make Your Business Plan Attractive to Prospective Partners
• Is This Idea Going to Work? How to Assess the Potential of Your Business.
• When to Update Your Business Plan
• How to Write the Management Team Section to Your Business Plan
• How to Create a Strategic Hiring Plan
• How to Write a Business Plan Executive Summary That Sells Your Idea
• How to Build a Team of Outside Experts for Your Business
• Use This Worksheet to Write a Product Description That Sells
• What Is Your Unique Selling Proposition? Use This Worksheet to Find Your Greatest Strength.
• How to Raise Money With Your Business Plan
• Customers and Investors Don't Want Products. They Want Solutions.
• 5 Essential Elements of Your Industry Trends Plan
• How to Identify and Research Your Competition
• Who Is Your Ideal Customer? 4 Questions to Ask Yourself.
• How to Identify Market Trends in Your Business Plan
• How to Define Your Product and Set Your Prices
• How to Determine the Barriers to Entry for Your Business
• How to Get Customers in Your Store and Drive Traffic to Your Website
• How to Effectively Promote Your Business to Customers and Investors
• What Equipment and Facilities to Include in Your Business Plan
• How to Write an Income Statement for Your Business Plan
• How to Make a Balance Sheet
• How to Make a Cash Flow Statement
• How to Use Financial Ratios to Understand the Health of Your Business
• How to Write an Operations Plan for Retail and Sales Businesses
• How to Make Realistic Financial Forecasts
• How to Write an Operations Plan for Manufacturers
• What Technology Needs to Include In Your Business Plan
• How to List Personnel and Materials in Your Business Plan
• The Role of Franchising
• The Best Ways to Follow Up on a Buisiness Plan
• The Best Books, Sites, Trade Associations and Resources to Get Your Business Funded and Running
• How to Hire the Right Business Plan Consultant
• Business Plan Lingo and Resources All Entrepreneurs Should Know
• How to Write a Letter of Introduction
• What To Put on the Cover Page of a Business Plan
• How to Format Your Business Plan
• 6 Steps to Getting Your Business Plan In Front of Investors

How to Identify and Research Your Competition Emphasizing your competitive advantage is an essential part of any business plan.

By Eric Butow • Oct 27, 2023

Key Takeaways

• Why competitive analysis matters
• Questions to ask about your industry
• How to find similar companies

Opinions expressed by Entrepreneur contributors are their own.

This is part 2 / 8 of Write Your Business Plan: Section 4: Marketing Your Business Plan series.

Successful entrepreneurs are renowned for intuitively feeling a market's pulse, project trends before anyone else detects them, and identifying needs that even customers are unaware of. After you are famous, perhaps you can claim a similar psychic connection to the market. But for now, you'll need to reinforce your claims to market insight by presenting solid research in your plan.

Market research aims to understand the reasons consumers will buy your product. It studies consumer behavior, specifically how cultural, societal, and personal factors influence that behavior. For instance, market research aiming to understand consumers who buy in-line skates might study the cultural importance of fitness, the societal acceptability of marketing directed toward children and teens, and the effect of personal influences such as age, occupation, and lifestyle in directing a skate purchase.

Related: 4 Effective Ways To Accomplish This Missing Step That Most Entrepreneurs Overlook

Market research is often split into two varieties: primary and secondary. Primary research studies customers directly, whereas secondary research studies information others have gathered about customers. Primary research might be telephone interviews or online polls with randomly selected target group members. You can also study your own sales records to gather primary research. Secondary research might come from reports on other organizations' websites or blogs about the industry.

Conducting market research provides answers to those unknown elements. It will greatly reduce risk as you start your business. It will help you understand your competitive position and the strengths and weaknesses of your competitors. And it will improve your marketing and sales process."

Related: You Need Consumer Insights To Ensure The Success Of Your Business. Here Are Five Ways To Find Them.

Questions to Ask About Your Industry

To start preparing your industry analysis and outlook, dig up the following facts about your field:

• What is your total industry-wide sales volume? In dollars? In units?
• What are the trends in sales volume within your industry?
• Who are the major players and your key competitors? What are they like?
• What does it take to compete? What are the barriers to entry?
• What technological trends affect your industry?
• What are the main modes of marketing?
• How does government regulation affect the industry?
• In what ways are changing consumer tastes affecting your industry?
• What are recent demographic trends affecting the industry?
• How sensitive is the industry to seasons and economic cycles?
• What are key financial measures in your industry (average profit margins, sales commissions, etc.)?

Related: 5 Essential Elements of Your Industry Trends Plan

How to Find Similar Companies

Find a close match when looking at comparable businesses (and their data). For comparative purposes, consider:

• Companies of relative size.
• Companies serving the same geographic area could be global if you plan to be a web-based business.
• Companies with a similar ownership structure. If you are two partners, look for businesses run by a couple of partners rather than an advisory board of twelve.
• Relatively new companies. While you can learn from long-standing businesses, they may be successful today because of their twenty-five-year business history and reputation.

You will want to use the data you have gathered to determine how much business you could do and to figure out how you will fit into and adapt to the marketplace.

Related: How to Make Your Business Stand Out

How To Do Original Research

One limitation of in-house market information is that it may not include exactly what you're looking for. For instance, if you'd like to consider offering consumers financing for their purchases, it's hard to tell how they'd like it since you don't already offer it.

You can get around this limitation by conducting original research—interviewing customers who enter your store, for example, or counting cars that pass the intersection where you plan to open a new location—and combining it with existing data. Follow these steps to spending your market research dollars wisely:

Determine what you need to know about your market. The more focused the research, the more valuable it will be.

• Prioritize the results of the first step. You can't research everything, so concentrate on the information that will give you the best (or quickest) payback.
• Review less expensive research alternatives. Small Business Development Centers and the Small Business Administration can help you develop customer surveys. Your trade association will have good secondary research. Be creative.
• Estimate the cost of performing the research yourself. Keep in mind that with the internet you should not have to spend a ton of money. If you're considering hiring a consultant or a researcher, remember this is your dream, these are your goals, and this is your business.
• Don't pay for what you don't need.

Related: The One Simple Task That Will Help Your Startup Succeed

More in Write Your Business Plan

Section 1: the foundation of a business plan, section 2: putting your business plan to work, section 3: selling your product and team, section 4: marketing your business plan, section 5: organizing operations and finances, section 6: getting your business plan to investors.

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Mastering Competitive Analysis in Business Plan

6 minutes read

In an ever-competitive business world where agility and innovation reign supreme, understanding the landscape in which your business operates is more than a mere advantage - it's a necessity. Thriving in today's dynamic environment demands a keen understanding not just of your business, but of the ecosystem within which it co-exists. This requires comprehensive awareness of who your competitors are, what they're doing, and how they're doing it. And this is precisely where competitor analysis comes into play.

In this article, you’ll know what competitive analysis is, why it is important and how to perform the analysis in a better way. Let’s dive in.

What Is Competitor Analysis

Competitor analysis is a strategic business practice that involves evaluating and understanding the strengths and weaknesses of competitors in the same industry or market. The primary goal is to gain insights into the competitive landscape, identify opportunities, and make informed decisions to improve your own business performance.

Key Aspects of Competitor Analysis in Business Plan

Competitor analysis is an essential part of any business plan, providing key insights that drive decision making and strategic planning. Understanding your competition can position your business favorably within the market and give you a competitive edge. This part highlights the critical aspects of competitor analysis you should focus on for effective business planning.

• Identification of Competitors: Recognizing who your competitors are is the first step. This includes both direct competitors offering similar products or services and indirect competitors who may fulfill the same need in a different way.
• SWOT Analysis: Assessing the strengths, weaknesses, opportunities, and threats (SWOT) of your competitors helps in understanding their internal capabilities and external challenges. This analysis aids in developing strategies to capitalize on weaknesses and counteract threats.
• Market Share and Positioning: Understanding the market share of your competitors and their positioning in the market relative to yours provides valuable insights. It helps identify areas where you can differentiate your products or services.
• Product and Service Offerings: Analyzing the features, quality, and pricing of your competitors' offerings helps you benchmark your own products or services. It can also reveal areas for improvement or innovation.
• Marketing and Branding Strategies: Evaluating the marketing and branding strategies of competitors provides insights into how they are reaching and engaging with their target audience. This information can be valuable for refining your own marketing approach.
• Customer Reviews and Feedback: Examining customer reviews and feedback for your competitors' products or services can highlight areas where they excel or fall short. This information can guide your efforts to meet or exceed customer expectations.
• Technological Advancements: Keeping track of technological advancements adopted by competitors can inform your own technology strategy. It ensures that you stay competitive in terms of innovation.
• Financial Performance: Analyzing the financial health of your competitors can provide an understanding of their stability and growth potential. This information is crucial for strategic planning.

Overall, competitor analysis is an ongoing process that helps businesses stay informed about industry trends, anticipate changes, and make well-informed decisions to maintain or improve their competitive position.

Why Is Competitive Analysis Important in Business Plan

Conducting a competitor analysis is not just about observing and replicating what others are doing. It's about leveraging this knowledge to formulate a unique and superior strategy that distinguishes your business from the rest. The importance of competitive analysis in a business plan can be seen in the following points:

• Identify Market Gaps: Through competitor analysis, we can identify unmet needs in the market or gaps in competitors' offerings that can be leveraged as potential business opportunities.
• Inform Decision Making: By understanding what strategies are working for competitors and why, we can make more informed decisions about our own strategic direction.
• Predict Competitor Moves: A detailed understanding of competitors can help predict their future actions based on their past behavior. This allows businesses to proactively devise counter-strategies.
• Benchmark Performance: Comparing key performance indicators (KPIs) against industry competitors helps determine how well your business is doing and where improvements can be made.
• Reduce Risks: By regularly analyzing competitors, businesses can detect threats early and take preventive measures to reduce potential risks.

Competitor analysis is a critical component of any business strategy. It's not just about keeping tabs on competitors but using this knowledge as a strategic tool for growth and improvement. 

How to Conduct a Great Competitive Analysis in Business Plan

The ability to stay ahead of the competition is vital in the ever-changing business landscape. Boardmix understands that importance and has made it a mission to equip businesses with the right tools to navigate this competitive environment. In this part, you will be led through a step-by-step process on how to conduct a great competitive analysis for your business plan.

Phase 1: Identifying Competitors

Every great competitive analysis starts with identifying your competitors. They can be direct (companies that offer the same products or services as yours) or indirect (companies that offer different products or services that serve the same purpose). With Boardmix's in-depth AI analysis tools, you can easily identify these competitors. Start with a list of 4-10 primary competitors in your market segment and then narrow down to those that directly impact your business.

Phase 2: Analyzing Competitor Products and Services

Once you've identified your competitors, it's time to scrutinize their products or services. Are there features that stand out? Are they priced higher or lower? What is their perceived value among customers? Boardmix provdies a feature can help streamline this process by offering a side-by-side comparison of your products and services with those of your competitors.

Phase 3: Assessing Competitors' Sales and Marketing Strategies

Understanding your competitors' sales and marketing strategies can provide crucial insights into their target audience, key messages, pricing strategy, and distribution channels. Leverage Boardmix's AI and infinite canvas capabilities to gather information about competitors' advertising, public relations, content marketing, SEO strategies, and more.

Phase 4: Examining Competitors’ Strengths and Weaknesses

This step involves analyzing each competitor's strengths, weaknesses, opportunities, and threats a SWOT analysis. Their strengths might be superior customer service, unique technology, or robust distribution networks. Weaknesses could be high prices or outdated offerings. Boardmix’s SWOT analysis tool can make this step seamless, helping you uncover potential areas where you can outshine your competition.

Phase 5: Studying Competitors' Market Positioning

How do your competitors position themselves in the market? Boardmix can help answer this by providing insights into competitors' branding strategy, unique selling propositions (USPs), and value proposition. Such an understanding will help you identify gaps you could fill to differentiate yourself in the market.

Phase 6: Ongoing Monitoring of Competitors

Competitive analysis should be an ongoing process due to ever-evolving markets and strategies. That's why Boardmix offers regular updates about changes in the competitive landscape so that you can adapt your strategies accordingly.

In conclusion, competitive analysis is pivotal in staying ahead of the game in business. It informs strategic decisions, helps exploit competitors' weaknesses, identifies market gaps, and creates unique value propositions. With Boardmix by your side, conducting a competitive analysis is made effortless and intuitive, ensuring your business carves out a unique and competitive space in the market.

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What Is Competitive Analysis and How to Do It Effectively

• 15 min read

Rebecca Strehlow, Copywriter at Crunchbase

Whether you’re an entrepreneur, market researcher or marketing enthusiast, knowing your competitors inside and out is a crucial part of the job. 

Competitive analysis is more than a quick online search; instead, it’s a systematic process that allows you to gain valuable insights into your competitive environment. By examining the strengths, weaknesses, strategies and market positions of rival companies, you can make informed decisions that help you come out on top.

Let’s dive into what competitor analysis is and how to do it, as well as the tools and templates you need to thrive in the modern market.

What is competitive analysis? 

Competitor analysis, often referred to as competitive analysis, is the systematic process of gathering and evaluating information about your competitors to gain a deep understanding of the competitive landscape in your industry. It involves delving into your competitors’ business models, marketing practices, product offerings, target audiences and much more.

This practice helps you keep a pulse on competing products in the market and make well-informed decisions for your business. It also enables you to find opportunities for growth, anticipate trends and proactively respond to potential threats.

Benefits of competitor analysis

The advantages of doing competitive analysis can have a meaningful impact on your bottom line. Here are just some of its key benefits: 

• Informed decision-making: By understanding your competitors’ strategies, you can make well-informed decisions about your own business. This includes choices related to product development, marketing and pricing.
• Identification of market opportunities: Competitor analysis can reveal gaps in the market or areas where your competitors may be underperforming. These insights can help you identify new opportunities for growth and expansion.
• Risk mitigation: By staying aware of your competitors’ activities, you can better anticipate potential threats and challenges. This proactive approach enables you to develop strategies to effectively mitigate risks and overcome threats before they happen.
• Benchmarking: Comparing your business to competitors helps establish benchmarks for performance. This allows you to measure your progress and identify areas where you excel or need improvement.
• Product and service enhancement: Analyzing competitors’ products and services can inspire improvements in your offerings, leading to increased customer satisfaction and loyalty.
• Improved marketing strategy: Understanding how your competitors market their products or services can help you refine your own marketing strategy to better reach your target audience.
• Adaptation to market shifts: The business environment is constantly evolving. Competitor analysis helps you stay agile and adapt to changes in customer preferences, technology and market trends.
• Competitive advantage: Armed with insights from competitive analysis, you can develop strategies to gain a competitive advantage in your industry.
• Long-term sustainability : Consistent competitor analysis allows your business to plan for the long term by identifying potential challenges and opportunities that may arise in the future.

Together, these benefits can empower you to thrive in the face of competition and establish a strong presence in the market. 

How to do competitor analysis 

To harness these advantages, you’ll need to learn how to perform competitive analysis effectively. The process is quite structured and involves several key steps to ensure that you gather relevant data and gain actionable insights.

• Identify your competitors
• Define your objectives
• Collect data
• Look for the 4 Ps
• Conduct a SWOT analysis

1. Identify your competitors

To pinpoint your competitors, create a list of organizations that compete with you both directly and indirectly in the marketplace. 

Direct competitors are organizations that offer similar products or services to the same target audience. In other words, they’re the businesses that potential customers could choose instead of your company.

To identify your direct competition, start by examining businesses that operate in the same industry or niche. Ask yourself questions such as:

• Who offers products or services that are nearly identical to ours?
• Who targets the same customer segments and geographical areas as we do?
• Who are our primary rivals when it comes to market share and sales?

Once you have identified these direct competitors, you can create a list or spreadsheet to keep track of their names, key characteristics and any available data that will be useful in your analysis.

Next, you’ll want to identify your indirect competitors. Indirect competitors serve a similar target market as your company, but may offer different products or services. They are indirect rivals because they can influence consumer choices, even though they are not in direct competition with your business. To identify indirect competitors:

• Look for businesses that serve the same customer needs, even if their products or services are not identical to yours.
• Consider how customers might choose between your offerings and those of indirect competitors.
• Examine businesses that could potentially expand into your market.

Including both direct and indirect competitors in your analysis provides a more holistic view of your competitive landscape and helps you anticipate shifts in consumer preferences or market dynamics.

Remember that the business environment is constantly changing, and new competitors may emerge over time. Regularly updating your list of competitors is essential to ensure that your competitor analysis stays relevant.

2. Define your objectives

The next step in competitive analysis is to clearly outline your objectives. This will ensure that you’re gathering relevant information that directly supports your business strategy. Here’s how to define your objectives effectively:

• Clarify your goals: Begin by outlining your overarching goals. Common objectives may include improving market share, optimizing pricing strategies, enhancing product development or refining marketing tactics.
• Identify your information needs: Use your goals to determine exactly what kind of information you’ll need. Ask yourself: What kind of data or insights will be most helpful in achieving your stated objectives? For example, if you want to improve product development, you may need data on your competitors’ product features, customer reviews and pricing.
• Develop KPIs: Write down the key performance indicators that are most relevant to your objectives. KPIs are quantifiable metrics that will help you measure your progress. For instance, if your goal is to enhance marketing strategies, relevant KPIs might include website traffic, conversion rates or social media engagement.
• Determine a time frame: Understanding the time frame of this project will influence the depth and scope of your analysis. Are you conducting a one-time competitor analysis, or is this an ongoing process? 
• Align with business strategy: Ensure that the above aligns with your overall business strategy. Your competitor analysis should directly contribute to the success and growth of your business.
• Adapt when necessary: Be open to adjusting your objectives as needed. The business landscape can change rapidly, and you may need to adapt in response to new opportunities or challenges.

When you define your objectives, you give yourself a clear roadmap for your research. This helps you focus on gathering the most pertinent data and ensures that your analysis directly benefits your business. Whether you’re looking to outperform competitors in a particular area or gain a broader understanding of the competitive landscape, well-defined objectives are the cornerstone of a successful analysis. 

3. Collect data

Effective data collection is another fundamental step in the competitor analysis process, as the quality and relevance of the data you gather directly influence the insights you gain. Begin by identifying data sources that will give you the information you’re looking for. These sources can include both online and offline channels.

Online sources are often the richest and most accessible. Common data sources for competitive monitoring include:

• Crunchbase : Crunchbase is a valuable resource for gathering data about companies, including your competitors. It offers details about a company’s firmographics, funding, leadership team, investor relationships and key metrics. This data helps you understand your competitors’ financial health, investment history, growth strategies and potential areas of expansion. 
• Company websites: Competitor websites are valuable sources of information about your competitors’ products, services, pricing and promotional strategies. They provide direct insights into how your competitors present themselves to customers and the market. 
• Social media: Social media platforms such as Facebook , X (formerly Twitter) , Instagram and LinkedIn offer a glimpse into your competitors’ marketing and promotional efforts. Analyze their posts, content engagement and follower interactions to understand their messaging and customer engagement strategies. You can also use social media to monitor comments, reviews and conversations to gauge customer sentiment and identify your competitors’ strengths and weaknesses.
• Customer review sites: Review sites like G2 , Capterra or dedicated industry-specific review platforms also offer candid customer feedback. Analyze the reviews to understand customer satisfaction levels, identify pain points and discover areas where your competitors excel or underperform. Some reviews may also mention pricing, which can help you determine how customers perceive the value of your competitors’ products or services.
• Market reports: Market research companies like Nielsen , Gartner , Forrester and Euromonitor International often produce comprehensive market reports across various industries. They often include data on market size, growth projections and emerging opportunities, helping you assess the overall landscape your competitors operate in. Market reports may also include company profiles, giving you information about their market share, strategies and financial performance. 
• Industry publications: Business publications and journals often publish in-depth articles and analysis about trends, innovations and market players. They can provide valuable information about your competitors’ strategies, market positioning and noteworthy developments. Crunchbase News , which offers data-driven reporting on private markets, is a great place to start.
• Government databases: Government databases can provide access to financial and regulatory information about companies, including your competitors. This data may include financial statements, business registrations and industry-specific regulatory compliance, helping you understand their financial health and legal compliance.

As you gather this data, make sure you have an organized place to put it. A good idea is to create a competitor matrix, also referred to as a competitor grid, which is a spreadsheet for organizing your research. List out your competitors on one axis of the grid (either the horizontal or vertical axis is fine). On the other axis, list the data points you’re looking to collect, such as company location, market position, price and branding.

A couple additional notes: pay attention to both your data accuracy as well as any ethical considerations. Confirm that the information you gather is up to date and reliable, as outdated or inaccurate data can lead to erroneous conclusions. On top of that, be mindful of legal requirements. Respect privacy rights, copyright and intellectual property laws when gathering data.

4. Look for the 4 Ps

Next, you’ll want to analyze your competitors’ marketing strategies. A systematic way to approach this is by looking at the 4 Ps of marketing, also known as the marketing mix. These are product, price, place and promotion, which you can break down into the following questions:

• What are the key features and attributes of our competitors’ products?
• How does the quality of our competitors’ products compare to ours?
• Are there any unique or innovative features in our competitors’ products that we should be aware of?
• What is the product life cycle of our competitors’ offerings, and how does that impact their market presence?
• How do our competitors brand and position their products in the market?
• Do our competitors offer a wide product range, or do they focus on a niche market?
• What are the customer reviews and feedback on our competitors’ products, and what strengths or weaknesses do they highlight?
• How do our competitors handle product updates, customer support and warranties?
• What are the pricing strategies employed by our competitors (e.g., premium, value, competitive or penetration pricing)?
• How do our competitors price their products or services compared to our pricing?
• What types of discounts, promotions or special offers do our competitors use, and how frequently do they change them?
• Do our competitors offer bundle pricing or product packages?
• How do our competitors handle pricing changes and adjustments based on market conditions or demand?
• What is the perceived value of our competitors’ products or services in relation to their pricing?
• Are there any loyalty programs or customer rewards related to pricing that our competitors offer?
• How do competitors communicate their pricing to customers, and does it align with their branding and positioning strategies?

Place (distribution)

• What distribution channels do our competitors use to reach their customers (e.g., direct sales, retailers, e-commerce or wholesalers)?
• How extensive is the geographic reach of our competitors’ distribution networks?
• Are there specific partnerships or collaborations that our competitors have with distributors or retailers?
• What is the availability and accessibility of our competitors’ products or services, both online and offline?
• How do our competitors handle inventory management, logistics and fulfillment to ensure timely delivery to customers?
• Do our competitors have a physical presence, and how does it impact their brand and customer engagement?
• What is the overall customer experience with the distribution and availability of our competitors’ offerings?
• Are there any supply chain or distribution challenges that our competitors face?
• What are the core elements of our competitors’ marketing and advertising strategies (e.g., online ads, content marketing, social media, traditional media)?
• How do our competitors position their brand, and what is their unique selling proposition?
• What messaging and tone do our competitors use in their advertising and marketing campaigns?
• How do our competitors engage with customers on social media, and how do they manage their online reputation?
• What content marketing tactics do our competitors employ to educate and engage their audience?
• Do our competitors use influencer marketing or partnerships with other brands or organizations?
• What customer feedback, testimonials or case studies do our competitors use in their promotional materials?
• How do our competitors measure the success and impact of their promotional efforts, and what adjustments do they make based on these metrics?

These questions will force you to think hard about your competitors and the ways they position their product or service in the market. Be sure to make a note of these data points so you have an organized spreadsheet with your competitive analysis. 

5. Conduct a SWOT analysis

Now, conduct a SWOT analysis using all the data and insights you’ve gathered. A SWOT analysis is a competitive analysis framework for systematically evaluating your competitors’ strengths, weaknesses, opportunities and threats. Create a table or slide deck with the following notes about each competitor:

• Strengths: Consider areas like product quality, brand reputation, financial stability and unique capabilities. What does your competitor excel at? What are their key assets and resources? What advantages do they have over your business and other competitors?
• Weaknesses: Analyze your competitors’ weaknesses, which are internal factors that put them at a disadvantage. Evaluate areas where they struggle, such as customer service issues, product limitations or operational inefficiencies. Where does your competitor fall short? What are their operational or financial weaknesses? Are there aspects of their products or services that receive consistent criticism?
• Opportunities: Consider the external factors and opportunities that your competitors can capitalize on. These may include market trends, emerging customer needs, technological advancements or changes in regulations. Here, you’ll want to ask yourself the following questions: What market opportunities are your competitors pursuing? Are there emerging trends that they are well-positioned to benefit from? How do they adapt to changing market conditions and customer demands?
• Threats: Evaluate the external factors and threats that pose risks to your competitors’ business. These could be increased competition, economic downturns, changing consumer preferences or regulatory challenges. What are the external threats that our competitors face? How do market or industry conditions pose risks to their operations? Are there competitive pressures that could erode their market share?

After identifying the strengths, weaknesses, opportunities and threats of your competitors, it’s time to analyze the findings. Look for connections and relationships between these factors. For example, how do strengths offset weaknesses, or how can opportunities be leveraged to mitigate threats? Consider how these factors impact your competitors’ overall competitive positioning.

Competitive analysis templates

Competitive analysis is a complex task, but you don’t have to start from scratch. These competitor analysis templates provide a structured framework for gathering and analyzing data about your competitors:

• Competitor research template
• Competitor matrix template
• Social media competitor analysis template
• SWOT analysis template

1. Competitor research template

This advanced search template is a helpful starting point for gathering data about competing companies. You can customize the template by adding multiple search filters, such as industry, geographic location and funding information, to pull up the companies that match your competitor profiles. The more you fine-tune your search, the more precise your list of competitors will be.

2. Competitor matrix template

A competitor matrix template , like this one from HubSpot , allows you to systematically compare key features, pricing and other attributes of your products or services with those of your competitors. By comparing these attributes side by side, you can better assess your biggest threats and identify areas where your business can excel.

3. Social media competitor analysis template

This social media competitor analysis template offers a structured framework for assessing and comparing your social media performance with that of your competitors. With sections for tracking key metrics, content strategies, audience engagement and more, this template simplifies the process of understanding how your social media efforts stack up against the competition. 

4. SWOT analysis template

This SWOT analysis template represents one of the most important types of competitive analysis templates. A template can simplify the SWOT analysis process and ensure that nothing falls through the cracks, helping you identify areas for improvement, capitalize on advantages and mitigate potential risks.

Competitive analysis examples

To understand how competitive analysis works in practice, let’s explore a few real-world examples that highlight its significance within different industries:

1. Apple vs. Samsung

Tech giants Apple and Samsung have long been rivals in the smartphone market. Both companies must scrutinize each other’s product launches, innovations and market share to stay competitive. Their competitive analysis involves a deep dive into one another’s product features, pricing strategies, branding and marketing tactics. 

2. Coca-Cola vs. Pepsi

Coca-Cola and PepsiCo have engaged in one of the most iconic and enduring business rivalries. Competitor analysis here includes assessing their advertising campaigns, product diversification, distribution networks and customer preferences. These two giants need to continuously monitor each other’s market positioning in order to win over consumers.

3. Amazon vs. Walmart

Amazon and Walmart are leaders in e-commerce and retail. They must perform ongoing competitive analysis to compare delivery speeds, pricing structures, customer experience and market expansion strategies. Both companies are committed to staying ahead by understanding the strengths and weaknesses of the other.

4. Airbnb vs. Booking.com

Another iconic competitor analysis example is within the online travel industry. Airbnb and Booking.com are key competitors that need to evaluate each other’s user reviews, property listings, pricing and website user experience. Both platforms continuously track each other’s offerings to enhance their competitive position.

5. Nike vs. Adidas

Nike and Adidas are major players in the athletic apparel industry. These companies closely follow each other’s strategies to dominate the market. Their competitive analysis includes examining product innovations, brand endorsements, athlete sponsorships and global market presence. 

Competitor analysis tools 

In order to conduct robust competitive analysis like the companies above, you’re going to need the right tools. These include everything from online databases to website monitoring platforms. Here are our top recommendations: 

1. Crunchbase

Crunchbase is a comprehensive business intelligence tool that provides best-in-class data about both public and private companies, including your competitors. You’ll get insights into funding, leadership teams, key metrics and investor relationships, allowing you to understand your competitors’ financial health, investment history and market focus. This information is vital for identifying potential threats in the market, as well as opportunities to differentiate yourself. Learn more about market research on Crunchbase .

2. Brandwatch

Brandwatch is a social listening and consumer intelligence platform that helps you monitor your competitors’ social media mentions, customer sentiment and brand reputation. This allows you to gauge public sentiment about your competitors and identify areas where you can strengthen your brand’s image and stand out in the market.

SEMrush is most commonly known as an SEO platform, but it’s also a useful competitive analysis tool. It helps you analyze your competitors’ digital marketing strategies, keywords, backlinks and advertising efforts. Ultimately, this gives you insights into your competitors’ online presence and helps you identify their strengths and weaknesses in the digital space. Note that you can view SEMrush web traffic data directly from Crunchbase .

4. SimilarWeb

SimilarWeb is a market intelligence platform that offers insights into website traffic, audience demographics and online performance. It allows you to benchmark your website’s performance against those of your competitors, discover their traffic sources and understand their online audiences.

IPqwery is a competitive analysis tool that offers insights into your competitors’ patent portfolios, technological innovations and intellectual property strategies. This allows you to assess innovation, identify potential partnerships, and evaluate the intellectual property landscape. IPqwery data is available with Crunchbase Data Boost .

Achieve sustainable growth with competitor analysis

Competitive analysis doesn’t only involve gathering information, but it’s also about turning insights into actions that drive your business forward. Competitor analysis is an important part of market research for startups and large companies alike, as it’s fundamental for long-term success. By carefully assessing your rivals and industry trends, you can adapt your strategies and stay ahead of the curve. 

• market research
• Originally published October 26, 2023, updated December 19, 2023

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How to Write the Competitive Analysis for Your Business Plan

Back to Business Plans

Written by: Carolyn Young

Carolyn Young is a business writer who focuses on entrepreneurial concepts and the business formation. She has over 25 years of experience in business roles, and has authored several entrepreneurship textbooks.

Edited by: David Lepeska

David has been writing and learning about business, finance and globalization for a quarter-century, starting with a small New York consulting firm in the 1990s.

Published on February 19, 2023 Updated on December 12, 2023

Starting a business usually involves countless tasks, and one of the most important early hurdles is writing a business plan . Many entrepreneurs who aren’t looking for funding think they can skip this step, but that’s never a good idea. 

A crucial element of the business plan is the competitive analysis, mainly because only by understanding your competition will your company be able to beat them.

Fortunately for you, this handy guide lays out all you need to know to whip up an excellent competitive analysis that’s sure to give you a serious advantage. 

• What is a Competitive Analysis?

A competitive analysis describes your competitors and their products or services and identifies their strengths and weaknesses and competitive advantages. Writing the analysis involves detailed research and an examination of your competitors, their strategies, and their customers.

The goal is to identify how your business can gain a competitive advantage, usually by capitalizing on competitors’ weaknesses or beating them in a particular area, such as price or customer service.

A competitive advantage is critical to the success of your business, and something investors tend to focus on, so be sure to do your homework to determine yours.

• Steps to Write a Competitive Analysis

Writing a competitive analysis involves several steps.

1. Identify your top competitors

First, identify 5-10 competitors. They can be direct or indirect competitors. Direct competitors sell the same or similar products, while indirect competitors sell different products that solve the same problem. Burger King is McDonald’s direct competitor, for instance, while Chipotle is an indirect competitor.  

A good competitive analysis begins with a brief overview of each competitor.

2. Research your competitors

Next, research those competitors to find out more about what they offer, how they offer it, and to whom. You can get this info on the company’s websites, social media, marketing, and any news and financial reporting.  

Their marketing should help you to identify their value proposition and their target market . It may help to study their marketing through the eyes of a consumer. 

What need do they fill? Who would find their marketing appealing? Where do they advertise? If their ads appear on TikTok, they’re looking to attract a younger market. 

Read customer reviews to learn more about what they’re doing right, and more importantly, areas in which they fall short. You might even want to buy some of your competitors’ products, which would certainly help you with the next section of the plan. 

3. Compare products

Now it’s time to thoroughly compare your competitors’ products to your own, examining the features and uses, as well as pricing, quality, and market placement.  

This should show you how your product stacks up and give you ideas about how to improve it, perhaps with new features or added options.  

4. Identify competitor strengths and weaknesses

By now you should be able to identify the strengths and weaknesses of your competitors. What do they do well? Where do they fall short? In your competitor summaries, list the strengths and weaknesses of each. 

5. Identify competitor competitive advantages

At this point you should know each competitor’s competitive advantage. What is their key differentiator? How does their product stand out? A competitive advantage is usually one of the following:

• Customer service
• Brand awareness
• Technology 
• Convenience
• Rapid innovation
• Unique features
• High quality 
• Corporate social responsibility
• Empathetic marketing
• Eco-friendliness
• Employee expertise

6. Determine your competitive advantage

Now we get to the whole point the competitive analysis – figuring out where your business can gain an advantage. What does your company offer that they don’t? What can you do better than they do? Review the above list of competitive advantages – does any of them jump out to you? 

It could be something your business already does or has, or something you need to implement to gain an edge. Either way, it’s critical that you identify at least one differentiator that’s likely to persuade customers to choose your business. 

• Structure Your Competitive Analysis

As previously mentioned, your competitive analysis should be structured as a series of summaries about each competitor and how your company compares. It might help to create a chart or table to illustrate your main points and findings. 

Each summary should mention the key product features as well as strengths, weaknesses, and competitive advantage. Conclude the plan by explaining your competitive advantage, as well as how you will leverage it and sustain it. 

Sounds like a lot of work, right? And this is just one part of your business plan! 

A great deal of effort and research goes into a good competitive analysis, which highlights the complexity, and the importance, of writing a business plan. It’s a lot of work, but also a fantastic learning opportunity that will help develop informed strategies that shape your business. 

Even if you’re not seeking funding, take the time to write a solid business plan and be sure to dig into the competitive analysis. After all, finding and embracing your business’ competitive advantage is likely to be one of the keys to your success. 

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What is competitive analysis? Template, examples, and how-to

In this comprehensive guide, we’ll define what a competitive analysis is, describe the benefits product teams stand to gain from conducting one, and walk through the steps of how to do a competitive analysis.

Through the tutorial, we’ll refer to examples to demonstrate how each step of a competitive analysis works in practice. We’ll also provide a list of customizable, free competitive analysis templates for you to use when completing these steps on your own.

Complete guide to competitive analysis

Picture this: you just came up with the next disruptive, game changing, AI-powered e-commerce marketplace. The objective is to connect buyers with sellers to fulfill their tailored and customized product needs.

You’re confident your product will take on Etsy and other big players in the market. You did some market and user research and have a good idea of your ideal customer and their (underserved) needs. Based on this data, you believe your marketplace can reach product-market fit quickly.

It’s now time for you to dust off your copy of Sun Tzu’s  T he Art of War . Why is that, you ask?

The Art of War is an ancient Chinese military textbook that, although dated somewhere between ~500–400 B.C., is one of the most influential management books out there to this day. It provides great strategic and tactical advice. Moreover, it provides guidance to help you assess yourself and your competition to gain an advantage.

Maintaining a competitive advantage is the goal. Even if you have the best product in the world and you know there is a market for it, if you don’t understand your competition, you‘re bound to fail. That’s why you need to perform a competitive analysis.

As the band Rage Against the Machine would say, know your enemy .

What is competitive analysis?

Competitive analysis (sometimes called a competitor analysis or competition analysis) is exactly what it sounds like: a structured approach to identifying and analyzing your competitors. More concretely, it’s an assessment of your competition’s offerings, strategy, strengths, and weaknesses.

A competitive analysis helps you answer questions such as:

• Which other companies are providing a solution similar to ours?
• What are the ideal customer’s minimum expectations?
• What are they currently not getting from our product with regard to those expectations?
• What barriers do competitors in the market fce?
• What should we avoid introducing in our product?
• What price are customers willing to pay for our product?
• What value do we need to provide to make our product stand out in the market?
• What trends are happening and how might they change the playing field?

When conducted thoroughly and regularly, a competitive analysis provides you with tons of information that can be used to improve and optimize your product. The end result is a holistic overview of your competitor landscape.

Why do a competitive analysis?

Competitive analysis is a fundamental product management instrument. It helps PMs learn what works and what doesn’t when trying to acquire market share, identify market trends, and locate gaps in their product offering.

Competitive analysis exists to help you avoid making mistakes and empower you to beat competitors to the punch in the pursuit of product growth and success.

Knowing your competition will bring you great rewards. Conducting a competitive analysis will help you more effectively:

• Create benchmarks
• Identify opportunities to better serve customers
• Make strategic decisions
• Determine your pricing strategy
• Identify market gaps
• Determine distribution and marketing strategies

Typically, the first time you create a competitor analysis is when doing your market research. This helps you get an idea of the product-market fit , which will evolve along your journey.

As a product manager, your role is not to analyze how well your competitors are able to showcase themselves. It is your job to make the product what the customer needs it to be. Understanding your competitor’s capabilities, pricing, and product positioning helps you in this.

Keep in mind that your competitors will likely showcase themselves to appear better than they probably are. You’ll be able to acquire tons of information about them, but you should take that information with a pinch of salt.

How to do a competitive analysis

There is no a single way to do a competitive analysis. In general, a competitive analysis is made up of three fundamental components:

• A shortlist of competitors
• A competitor deep dive
• A holistic overview and strategy

To demonstrate how to do a competitor analysis, we’ll refer back to the example outlined in the introduction.

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Remember, in our example, we’re looking to disrupt the market with an AI-powered e-commerce marketplace app that helps buyers and sellers connect to fulfill highly customized orders. Let’s call our innovative new product AGORA.

1. Create a shortlist of your competitors

There are three types of competitors:

• Direct — Competitors that offer the same product and target the same ideal customer; you are battling direct competitors heads-on
• Indirect — Competitors that either offer a somewhat similar product or target the same ideal customer
• Replacement — Competitors that offer a different product but target the same ideal customer

For a competitive analysis, you need to identify at least your direct and indirect competitors. So how do you do that? By looking inward and researching obsessively .

Look inward

To figure out who your direct and indirect competitors are, you need to look inward first to understand your product positioning: who are you servicing and what is the offering you are providing?

You can answer these questions by doing a self-assessment using the product canvas . Originally introduced by Roman Pichler, the product canvas has since tbeen tweaked and refined.

In its core, the product canvas covers:

• The name of the product
• Objectives and key metrics for success
• The ideal customer
• A high-level overview of what’s required to meet the customer’s needs
• Just enough product details about short-term goals

For our example product, the competitive analysis might look something like this:

Research obsessively

A simple Google search using keywords from your self-assessment can get you pretty far. Other resources that can help you identify your competitors include tools such as Crunchbase, Similarweb, Statista, etc.

As the old saying goes, the customer knows best. If you don’t have many customers yet, review sites such G2, Capterra, Trustpilot, and Google Reviews can help you.

If you do have customers, go ask them. Most customers try and evaluate several products before deciding on the right product to buy. Nothing is stopping you from asking them which other brands they considered and why they ultimately chose yours.

Once you have established who your competitors are, you might find yourself in a market with many direct and indirect competitors. If that is the case, select about seven of the most relevant competitors to include in your competitor deep dive.

2. Do a deep dive on each competitor

From your a shortlist of competitors, choose about seven of your most important and dig up all the relevant information on each one.

The research conducted during the previous step will help you capture the most relevant information about your competitors for the following categories:

Company profile

Ideal customer profile, product information, market approach, swot analysis.

Start by creating a company profile for each of your competitors to gain a better understanding of who they are. Include the following information:

• Name   —  What is the name of your competitor?
• Founding date  —  When was the company founded? How long has it been in the market?
• Company size  —  How many employees does the company have? Are they equipped to service the market and innovate?
• Market share  — The portion of the market controlled by the competitor’s product
• Revenue   —  The income the competitor generates from its product
• Reputation   —  What do customers think of your competitor’s product on a scale from one to five?

Let’s apply this framework to our AGORA competitive analysis example:

It’s important to understand who your competitors are serving and who is buying the product. This not only to reconfirm that the competitor is indeed a direct (or indirect) competitor, but also to understand what customers like and dislike about the competitor’s product.

The information you’re looking for includes:

• Ideal customer   —  Who is the competitor’s target customer and what defines them?
• Motivations   —  What does the customer enjoy about your competitor’s product?
• Frustrations   —  What does the customer hate about the product?
• Primary buyer  —  Who is the primary buyer of the product? Is it the as the ideal customer, or is it a different persona?

Let’s see what this would look like following our AGORA example. Below is an example ideal customer profile for Etsy. First, for the buyer:

And the ideal customer profile for Etsy sellers:

Not to be captain obvious, but you want to capture more details about the product your competitor is offering and its positioning.

The information we’re looking for at this step includes:

• The product   —  What is the tagline your competitor is using to market its product?
• Positioning   —  Based on the quality and price of the product, place the product into a one of several buckets. For example, Economy (low quality, low price), Skimming (low quality, high price), Penetration (high quality, low price), and Premium (high quality, high price)
• Product features   —  What are the key features being marketed and promoted?

Referring to our example AGORA app, the product information associated with Etsy on a competitor analysis might look as follows:

Next, seek to understand how your competitors are bringing the product to market .

List the following information:

• Pricing — What does the product costs? If there is a tiered pricing model, what does it look like?
• Distribution channels — Through which channels is your competitor selling the product?
• Marketing channels — Through which channels is the product being promoted?

In our AGORA competitor analysis example, this section would look something like:

With all the information you’ve collected, you’ll find yourself in a good place to do a SWOT analysis . This is one of the most common and popular competitive analysis frameworks.

SWOT stands for strengths, weaknesses, opportunities, and threats:

• Strengths  —  What is going well for the competitor?
• Weaknesses   —  What is not going well? What obvious flaws are there?
• Opportunities   —  What could give your competitor an advantage?
• Threats  —  What might harm your competitor’s product?

For AGORA, our example competitive analysis might include a SWOT analysis that looks like this:

3. Develop a holistic overview and strategy

Now that you have a better view of your competitors, it’s time to determine how you want to approach them in the market: do you want to avoid your competitors or attack them?

Two extremely useful tools that can help you make this assessment are the competitive matrix and battle cards .

Competitive matrix

One way to operationalize the data you gathered during your competitive analysis is to plot out a four-quadrant competitive matrix.

Define key factors for the and x and y axes and plot yourself and your competition accordingly to see how you stack up. This approach is also known as perceptual mapping.

A competitive matrix for our example would look like this:

Battle cards

You can use the four-quadrant competitive matrix and competitor insights to create battle cards for each of your competitors.

Battle cards are a visual aid that help you compare your product against those of your competitors at a glance. It’s a quick and easy way to see how you stack up in key areas of performance and value. It’s also a neat way to help sales in their conversations with customers.

Here’s what you should include on each battle card:

• Company name — Name of your competitor
• Powers  —  What makes this competitor stand out from the rest?
• How we win   —  What should we do to gain a competitive advantage over this competitor?
• Why we lose   —  What is this competitor better at? What should we avoid so we don’t lose market share?
• Pricing   —  How much of a threat is the competitor’s product to our market share (low, medium, or high)?
• Strategy   — Should we attack or avoid this competitor?

A battle card for our example competitive analysis might look as follows:

Alternative competitive analysis frameworks

If you‘ve followed the framework described above, you should have solid insight into your competitors, your product opportunities, and the best strategy to attack or avoid your competitors in the market.

If you want to dig deeper, you can follow up your competitive analysis by producing a Five Forces analysis and/or customer journey map .

The Five Forces model

You still might want to consider gaining more insights into the competitive structure of the market you are in — in other words, gain a better understanding of how easy it is to either enter or be replaced by a competitor in the market.

A great framework to use for this type of competitor analysis is the Five Forces model , originally conceived by Michael Porter.

According to the Five Forces model, you can assess the market you are in by looking at:

• Intensity of competitive rivalry
• Negotiation power of new buyers
• Negotiation power of suppliers
• Threat of new entrants
• Threat of substitutes

Customer journey map

Instead of zooming out, you can also zoom in on the journey ideal customers make when interacting with the product itself, the distribution, or marketing channels.

On a journey map, your touchpoints are the customer, the activity performed, how the customer experiences the activities, and their expectations.

Free competitive analysis templates

A competitive analysis is a continuously updated document packed with information about your most important competitors to help you determine how to approach them in your target market.

The competitive analysis model described in this article consists of three steps that are designed to produce the insights you need to rule the market once and for all.

Below are free, customizable competitive analysis templates for each step of the process described in this article:

• Competitive analysis template
• Product canvas template
• Competitive matrix template
• Battle card template
• Customer journey map template

NOTE : To use and customize the competitive analysis templates above, after opening, select File > Make a copy from the main menu.

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How to Create a Competitor Analysis Report (with Examples)

By Midori Nediger , Nov 09, 2023

Your business will always have competition.

And if you don’t know what that competition is up to, you could be missing out on huge opportunities.

That’s why a competitive analysis is so crucial to your success as a business. It gives you the tools to quickly adapt to any changes in the competitive landscape and potentially capitalize on industry trends that your competitors haven’t even noticed.

So let’s get some basics out of the way…

What is a competitive analysis report?

A competitive analysis report outlines the strengths and weaknesses of your competitors compared to those of your own business.

Typically, a competitive analysis report will contain:

• A description of your business’s target market
• Details about the features of your product compared to your competitors’ products
• A breakdown of current and projected market share, sales, and revenues
• Comparisons of pricing models
• An analysis of marketing strategy and social media strategy
• A description of customer ratings of the features of each competitor

Whether you’re a startup trying to break into the marketplace , a consultant trying to get results for your client, or an established company looking to cement your foothold against the competition, a well-researched competitive analysis gives you the tools you need to make strategic decisions.

Your competitive analysis should inform your marketing plan , your business plan , your consultant report and every part of your high-level business strategy.

But how do you actually create a competitive analysis report?

How to make competitor analysis report :

• Start with a competitor overview
• Conduct market research to uncover customer personas and industry trends
• Compare product features in a feature comparison matrix
• Summarize your strengths and weaknesses with a SWOT analysis
• Show where you fit in the competitive landscape
• Use a competitor analysis template for a professional look and feel

The level of detail you include in each section of your competitive analysis report will vary depending on the stage of your business growth and your goals. For example, a startup might create a report that focuses on market research, while an established business might dive into detail on an emerging competitor.

But let’s talk about the parts of a competitive analysis that every report should include.

1. Start with a competitor overview

A strong report shows exactly what a company must out-compete to be successful.

Meaning you must audit any product or service that currently solves the problem your business is trying to solve for customers and write a quick profile for each competitor.

Like the template below, each competitor profile might include:

• The company’s revenue and market share
• The company’s size and information about their management team
• A broad description of the company’s strengths and weaknesses
• An overview of how the company is perceived by customers

This overview will help your readers get a big-picture view of the market landscape.

2. Conduct market research to uncover customer personas and industry trends

You can’t create a competitive analysis report without doing extensive market research , which is all about gathering information to understand your customers, identify opportunities to grow, and recognize trends in the industry.

This research can help you put together the customer personas that will guide business and marketing decisions down the line, and allow you to plan for any shifts that might disrupt the marketplace.

You can conduct primary market research, with:

• Customer interviews
• Online surveys or questionnaires
• In-person focus groups
• Purchasing a competitor product to study packaging and delivery experience

Or secondary market research, by:

• Reading company records
• Examining the current economic conditions
• Researching relevant technological developments

When assembling your market research you may just want provide a high-level summary of the industry trends, like this competitor analysis example shows:

Or you may want to dive into detail on the demographics of a particular consumer segment, like this:

But if you’re a consultant or advisor struggling to get buy-in from skeptical stakeholders, the report below would be ideal. Covering everything from market forecasts to consumer profiles, it can help you get clients and decision-makers on board.

3. Compare product features in a feature comparison matrix

The feature comparison is arguably the most important part of the competitive analysis. Breaking down your product and your competitors’ products feature-by-feature will allow you to see what really sets everyone apart.

In addition to specific product features, here are some attributes that you might include in a feature comparison matrix:

• Product quality
• Number of features
• Ease of use
• Customer support
• Brand/style/image

The most common format for a features analysis is a simple matrix with you and your competitors along one side and all of the relevant features along the other. You can check off or rate how you perform in each area:

But these tables can get pretty long. Another approach is to focus on the things that provide the most value to the user, like in this competitor analysis example from Mint. It only includes ease of use, costs, and benefits:

If you want to visualize your comparisons in an engaging way, you could use a comparison infographic . 

Great resources for this section of your competitive analysis report are product rating sites like Capterra and G2Crowd . They’ll give you an unbiased view of your company and your competitors.

And as with any market research, it’s critical that you speak with real people who use your product and your competitors’ products. That’s the only way to get an accurate picture of how your target customers rate the competition .

4. Summarize your strengths and weaknesses in a SWOT analysis

When you’re conducting research for your competitive analysis, it’s going to be messy. You’ll have a lot of data and it’ll be hard for an outsider to understand.

That’s what makes the SWOT analysis so essential.

A SWOT analysis is a framework for evaluating your competitive position by listing your key strengths, weaknesses, opportunities, and threats.

It can act like a short summary of the rest of your competitive analysis report for anyone who doesn’t have time to dig into the details.

Click the template above to enter our online SWOT analysis maker tool. Customize the template to your liking–no design no-how required.

Here are some questions to kickstart your SWOT analysis:

• Strengths: What are we doing really well (in terms of marketing, products, sales, branding, technology, etc.)?
• Weaknesses: What are we struggling with? What’s holding us back?
• Opportunities: What’s the weakest area for our biggest competitor? Are there any gaps in the market that aren’t current being addressed? What has recently changed in our business or the market?
• Threats: What is our biggest competitor doing much better than us? What new products/features are they working on? What problems aren’t we currently addressing?

In your report, you could arrange your SWOT analysis in a simple list, but it can be helpful to use color-coded quadrants, like the competitor analysis example below. Note how each quadrant is paired with an icon:

5. Show where you fit in the competitive landscape

After summarizing your strengths, weaknesses, opportunities, and threats, it’s time to look at the bigger picture. It’s time to figure out where every major competitor currently fits into the competitive landscape.

The most popular way of doing this is to identify the two dimensions that are most important for being competitive in your industry and plot them on a matrix, like this one from the Boston Consulting Group:

And this one from G2 Crowd (which looks at market presence and customer satisfaction):

You may want to focus on where you fit in the market landscape based on your own biggest strengths and weaknesses, or the biggest threats and opportunities you identified in the SWOT analysis.

Or, it may be enough just to summarize in words the features and benefits that set your apart from your competitors (which is a great way to end your report on a high note).

Competitor analysis examples for strategic planning

Let’s delve into some competitor analysis examples that can empower your organization to navigate the market effectively.

1. Competitor analysis example for marketing specialists

Imagine this: You are a Marketing Specialist and your goal is to establish a strong online presence and attract a diverse user base. However, you face stiff competition from established players in the market. Here are some things you should look into when doing your competitor analysis:

Competitor analysis focus:

• SEO strategies: Analyze competitors’ websites to understand their SEO strategies. Identify high-ranking keywords, backlink strategies, and content optimization techniques . Alternatively, if you’re running a local business, you might want to analyze and scrape Google Maps listings to better assess how companies are optimizing Google My Business to generate leads.
• Social media engagement: Examine competitors’ social media presence. Evaluate the type of content that garners engagement, the frequency of posts, and audience interactions.
• Online advertising: Investigate competitors’ online advertising campaigns. Are they leveraging Google Ads, social media ads, or other platforms? Assess the messaging, visuals, and targeting criteria.
• Content marketing: Scrutinize competitors’ content marketing efforts. Identify the topics that resonate with their audience, the formats they use (blogs, videos, infographics), and the platforms they prioritize.

Here’s a SWOT analysis template to help you get started:

2. Competitor analysis example for SME business development managers

Imagine this: As the business development manager for a medium sized start up, you are tasked with expanding the client base. The market is crowded with similar service providers, and differentiation is key. When doing your competitor analysis report, look into:

• Client testimonials and case studies: Explore competitors’ websites for client testimonials and case studies. Identify success stories and areas where clients express satisfaction or dissatisfaction.
• Service offerings: Analyze the range of services offered by competitors. Identify gaps in their offerings or areas where you can provide additional value to clients.
• Pricing models: Investigate competitors’ pricing structures. Are they offering packages, subscription models, or customized solutions? Determine whether there’s room for a more competitive pricing strategy.
• Partnerships and collaborations: Explore potential partnerships or collaborations that competitors have formed. This can provide insights into untapped markets or innovative service delivery methods.

Here’s a competitor analysis comparison chart template that you could use:

3. Competitor analysis example for product managers

Imagine this: You are a Product Manager for a consumer electronics company tasked with improving your company’s products and services. The market is buzzing with innovation, and staying ahead requires a deep understanding of competitor products.

• Feature comparison: Conduct a detailed feature-by-feature comparison of your product with competitors. Identify unique features that set your product apart and areas where you can enhance or differentiate.
• User experience (UX): Evaluate the user experience of competitors’ products. Analyze customer reviews, app ratings, and usability feedback to understand pain points and areas for improvement.
• Technological advancements: Investigate the technological capabilities of competitors. Are they integrating AI, IoT, or other cutting-edge technologies? Assess whether there are emerging technologies you can leverage.
• Product lifecycle management: Examine competitors’ product release cycles. Identify patterns in their product launches and assess whether there are opportunities for strategic timing or gap exploitation.

To help you get started, use this competitive analysis report template to identify the strengths, weaknesses, opportunities and threats of the product or service

How to present a competitor analysis

Presenting a competitor analysis effectively involves organizing and communicating information about your competitors in a clear and concise manner. Here’s a step-by-step guide on how to present a competitor analysis:

• Introduction: Start with a brief introduction to set the stage. Outline the purpose of the competitor analysis and its significance in the current market context.
• Competitor identification: Clearly list and identify the main competitors. Include both direct and indirect competitors. Briefly describe each competitor’s core business and market presence.
• Key metrics and performance: Present key metrics and performance indicators for each competitor. This may include market share, revenue, growth rate, and any other relevant quantitative data.
• SWOT analysis: Conduct a concise SWOT analysis for each competitor. Summarize their strengths, weaknesses, opportunities, and threats. Use a simple visual representation if possible.
• Market positioning: Discuss how each competitor is positioned in the market. This could include their target audience, unique selling propositions, and any specific market niches they occupy. Also, focus on finding keywords , as your competitor’s targeted keywords are the main source of information on their online market performance.
• Strategic moves: Highlight recent strategic moves made by your competitors. This could include product launches, partnerships, mergers, acquisitions, or changes in pricing strategy. Discuss how these moves impact the competitive landscape.
• Recommendations and implications: Based on the analysis, provide recommendations and implications for your company. Identify opportunities to capitalize on competitors’ weaknesses and outline potential threats that need to be addressed. Discuss any adjustments to your own strategy that may be necessary in response to the competitive landscape.

3 tips to improve your competitive analysis report design

How you design your competitive analysis report can have a significant impact on your business success. The right report design can inspire stakeholders to take action based on your findings, while a mediocre design may reflect poorly on your hard work.

Here are a few report design best practices to keep in mind when designing your competitive analysis report:

• Start with a competitive analysis report template
• Keep core design elements like colors and fonts consistent
• Use visuals to summarize important information and keep your audience engaged

1. Start with a competitor analysis template

The quickest way to lose the confidence of your stakeholders is to present a messy, amateur report design. Besides distracting from the content of the report, it might even put your credibility at risk.

Starting with a pre-designed competitor analysis template, like the one below, takes almost all of the design work out of the mix so you can focus on the content (while still impressing your stakeholders).

And if you’re a consultant competing for a project, a pre-designed template may just give you the edge you need to land that client.

Click on any of our templates; you’ll enter our online drag and drop report maker tool. No design know-how required.

2. Keep core design elements like colors and fonts consistent

If you take a look at the competitor analysis template below, you might notice that the designer has switched up the layout from page to page, but many of the other design elements are kept consistent.

That consistency helps the report design feel cohesive while making it easier for readers to quickly skim for key pieces of information.

Here are a few quick guidelines for keeping important design elements consistent:

• Use the same color scheme throughout your report (with one highlight color to draw attention to key takeaways and important numbers)
• Use the same font styles for your headers, subheaders, and body text (with no more than 2-3 font styles per report)
• Use the same style of visuals throughout your report (like flat icons or illustrated icons… but not both)

3. Use visuals to summarize important information and keep your audience engaged

The challenge with a competitive analysis report is that you collect heaps of background research, and you have to condense it into a brief report that your client will actually read.

And written summaries will only get you so far.

Visuals like charts and tables are a much better way to communicate a lot of research quickly and concisely, as seen in the market research summary below.

Even lists can be made more engaging and informative by spacing out list items and giving more emphasis to headers:

The more you can replace descriptive paragraphs and long lists with thoughtful visuals, the more your readers will thank you.

A competitive analysis will allow you to think up effective strategies to battle your competition and establish yourself in your target market.

And a report that communicates the findings of your competitive analysis will ensure stakeholders are on board and in the know.

Now that you know how to design a competitive analysis report, you’re ready to get started:

What is a Competitive Analysis — and How Do You Conduct One?

Published: November 10, 2022

When was the last time you ran a competitive analysis for your brand? And most importantly, do you know how to do one efficiently?

If you‘re unsure or if the last "analysis" you ran was a quick perusal of a competitor’s website, you're likely missing out on important intelligence that could help your brand grow.

In this detailed guide, you'll learn how to conduct a competitive analysis to give your business an advantage.

Table of Contents

What is a competitive analysis?

• Understanding Competitive Market Research

Competitive Analysis in Marketing

How to do a competitive analysis, competitive product analysis, competitive analysis example, competitive analysis templates, competitive analysis: faqs, what is a competitive market analysis.

A competitive analysis is a strategy that involves researching major competitors to gain insight into their products, sales, and marketing tactics. Implementing stronger business strategies, warding off competitors, and capturing market share are just a few benefits of conducting a competitive market analysis.

A competitive analysis can help you learn the ins and outs of how your competition works and identify potential opportunities where you can outperform them. It also enables you to stay atop of industry trends and ensure your product is consistently meeting — and exceeding — industry standards.

Let's dive into a few more benefits of conducting competitive analyses:

• Helps you identify your product's unique value proposition and what makes your product different from your competitors, which can inform future marketing efforts.
• Enables you to identify what your competitor is doing right. This information is critical for staying relevant and ensuring your product and marketing campaigns outperform industry standards.
• Tells you where your competitors are falling short — which helps you identify areas of opportunities in the marketplace and test out new, unique marketing strategies they haven't taken advantage of.
• Learn through customer reviews what‘s missing in a competitor’s product, and consider how you might add features to your own product to meet those needs.
• Provides you with a benchmark against which you can measure your growth.

Competitive analysis is a meticulous strategy that dives deep into the operations of your prime competitors.

It's not just about knowing what they offer. You need to understand their sales strategies, marketing tactics, and the ethos driving their brand.

10 Free Competitive Analysis Templates

Track and analyze your competitors with these ten free planning templates.

• SWOT Analysis
• Battle Cards
• Feature Comparison
• Strategic Overview

You're all set!

Click this link to access this resource at any time.

10 Competitive Analysis Templates

Fill out the form to access the templates., why is a competitive analysis important.

The ripple effects of a well-executed competitive analysis are manifold:

• Strategic business decisions. Anchoring your business strategies on solid, data-driven insights ensures you stay ahead in the game.
• Fortifying defenses. By knowing what your competitors are up to, you can better defend your market share and even capture new territories.
• Unearth golden opportunities. Delving into the intricacies of your competition’s operations can spotlight areas where you can shine brighter.

Beyond Just the Basics

While it's essential to understand how your competition operates, the real magic happens when you can:

• Spot your unique value. What sets you apart? How can you amplify that difference in your marketing efforts?
• Learn from their triumphs. Your competitors might just be doing something genius. Identifying their strengths ensures you're always at par, if not ahead.
• Discover their shortcomings. Every brand has its Achilles' heel. Find it. This knowledge can carve out opportunities and new strategies for your business.
• Tap into customer sentiments. Dive into customer reviews. What’s lacking in their product? Can you incorporate those missing features into your offerings?
• Benchmark your progress. Your journey is unique. However, setting a benchmark based on your competitors can offer valuable growth metrics.

What is competitive market research?

Competitive market research is a vital exercise that goes beyond merely comparing products or services.

It involves an in-depth analysis of the market metrics that distinguish your offerings from those of your competitors.

A thorough market research doesn't just highlight these differences but leverages them, laying a solid foundation for a sales and marketing strategy that truly differentiates your business in a bustling market.

In the next section, we’ll explore the nuts and bolts of conducting a detailed competitive analysis tailored to your brand.

Every brand can benefit from regular competitor analysis. By performing a competitor analysis, you'll be able to:

• Identify gaps in the market.
• Develop new products and services.
• Uncover market trends.
• Market and sell more effectively.

As you can see, learning any of these four components will lead your brand down the path of achievement.

Next, let's dive into some steps you can take to conduct a comprehensive competitive analysis.

• Determine who your competitors are.
• Determine what products your competitors offer.
• Research your competitors' sales tactics and results.
• Take a look at your competitors' pricing, as well as any perks they offer.
• Ensure you're meeting competitive shipping costs.
• Analyze how your competitors market their products.
• Take note of your competition's content strategy.
• Learn what technology stack your competitors use.
• Analyze the level of engagement on your competitors' content.
• Observe how they promote marketing content.
• Look at their social media presence, strategies, and go-to platforms.
• Perform a SWOT Analysis to learn their strengths, weaknesses, opportunities, and threats.

Don't forget to share this post!

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How to Conduct a Successful Competitor Analysis in Business Plan

Competitor analysis is the process of evaluating and deeply understanding the strengths, weaknesses, strategies, and performance of business or organizational competitors to gain insights for strategic planning.

Correct Competitor Analysis Steps.

Here are the steps to conduct competitor analysis in a business plan:

1. Identify Key Competitors.

Recognize the main competitors in your industry or market. The objectives of identifying competitors are as follows:

• Strategic Planning : Allows the company to plan business strategies better by understanding who the main competitors are and how they operate.
• Product or Service Differentiation : Enables the identification of ways to differentiate your products or services from competitors, thus attracting customers more effectively.
• Pricing Adjustment and Value Determination : Provides insights into how competitors determine the pricing and value of their products, allowing you to adjust your pricing strategy and value proposition.
• Customer Understanding : Identifies target customers and creates more effective marketing strategies by understanding customer preferences influenced by competitors.
• Market Change Response : Enables faster response to changes in market trends, competitor policies, or economic changes.
• Product Development and Innovation : Provides a foundation for developing new products or innovations by understanding market weaknesses or unmet needs.
• Competitive Advantage : Identifies competitive advantages and opportunities to outperform competitors in specific aspects such as product quality, customer service, or operational efficiency.

It’s also crucial to understand whether competitors compete directly or indirectly.

Here’s a more detailed explanation:

• Direct Competition : If competitors compete directly, it means they offer products or services that are similar to or resemble what you offer. Competition can be more focused and occur directly within the same product or service category.
• Indirect Competition : If competitors compete indirectly, they may not offer identical products or services, but they still vie for the attention and budget of the same customers. Competition may involve products or services that meet similar needs or are in related categories.

This understanding is important as it can influence marketing strategies and product differentiation. If competitors compete directly, the focus can be on direct product or service comparisons.

If competing indirectly, the strategy may involve emphasizing the unique value or features that distinguish your product or service from other options in the market.

2. Collect Competitor Information.

The next step is to gather data about competitors’ products, services, and marketing strategies.

Here are some actions you can take:

• Products and Services : Review competitors’ product or service catalogs. Identify features, specifications, and advantages they highlight. Observe how they address customer issues or provide after-sales service.
• Pricing and Pricing Policies : Examine competitors’ pricing models, including whether they use high, low, or mid-range pricing strategies. Also, note if there are discounts, special offers, or customer loyalty programs.
• Marketing Strategy : Analyze their marketing campaigns, including print, digital, or electronic media advertising. Review the success or customer response to their marketing strategies. Identify the key messages and values they emphasize.
• Target Market and Customer Segments : Understand who the target market or customer segments of competitors are. Identify demographic or behavioral characteristics of the customers they aim for.
• Distribution and Supply Chain : Observe the distribution channels used by competitors. Understand the availability of competitors’ products or services in various locations or platforms.
• Brand Reputation : Review the brand image of competitors and how they position themselves in the eyes of customers. Analyze customer reviews, testimonials, or online feedback related to their brand.
• Innovation and Product Development : Identify whether competitors continue to innovate or develop new products. Understand their strategies in responding to changes in trends or new technologies.

And here are some benefits you should know:

• Allows the company to understand its relative position in the market compared to competitors, aiding in identifying competitive advantages.
• Provides insights into competitors’ features, specifications, and advantages, enabling the company to differentiate its products or services.
• Understanding competitors’ pricing strategies helps the company determine competitive and value-based pricing.
• Provides necessary data to design effective marketing strategies by understanding methods and messages successfully used by competitors.
• Aids in better understanding the target customers and their needs by examining how competitors respond to and meet customer needs.
• Enables the company to respond quickly to changes in market trends or competitor strategies, maintaining or enhancing competitiveness.
• Offers insight into competitors’ innovation efforts, helping the company stay relevant and competitive through the development of new products or services.
• Identifies competitors’ overall strategies, such as market focus, differentiation, or low-cost, helping the company adjust its own strategies.
• Provides a strong data foundation for informative decision-making in business planning and long-term strategies.

By leveraging this information, companies can optimize strategies, enhance competitiveness, and better meet customer needs.

3. Observe Competitor Interactions with Customers.

Observe how competitors interact with customers and position their brand.

Here are some actions to conduct this observation:

• Social Media : Review competitors’ social media accounts to understand their interaction with customers. Analyze the types of content they share, responses to comments, and interaction frequency.
• Customer Surveys and Reviews : Examine customer reviews of competitors on various platforms. Observe how competitors respond to both positive and negative reviews.
• Content Marketing : Analyze competitors’ content marketing campaigns, including blogs, videos, or informational materials. Observe how they educate, entertain, or build connections with customers.
• Events and Sponsorships : Understand competitors’ involvement in events or sponsorships. Then, review how they interact directly with customers at events or through partnerships.
• Customer Service : Observe competitors’ customer service processes, including response time, ease of access, and effectiveness of solutions provided. Identify whether they have online or offline customer support platforms.
• Promotional Campaigns : Analyze competitors’ promotional or sales campaigns. Understand how they capture customer attention and convey the value of their products or services.
• Brand Perception Maps : Identify the key messages and values competitors emphasize in their marketing. Compare this with customer perceptions of your own brand.
• Product or Service Comparisons : Review how competitors structure comparisons of their products or services with others in the market, including your own.

And leveraging information on how competitors interact with customers and position their brand provides several strategic advantages, such as:

• Better Customer Experience Development : By understanding how competitors interact with customers, companies can enhance their own customer experience, tailoring services and responses more effectively.
• Social Media Strategy Optimization : Analyzing competitors’ social media interactions can help companies understand trends, create more effective content, and improve customer engagement.
• Customer Conflict Resolution : Through monitoring competitors’ reviews and responses, companies can learn from competitors’ experiences in handling customer conflicts and enhance their own conflict resolution solutions.
• Competitor Understanding : Knowing how competitors position their brand helps companies understand customer perceptions of competitors, providing insights into their own strengths and weaknesses.
• Content Marketing Strategy Refinement : Analyzing competitors’ content marketing campaigns helps companies craft more effective content marketing strategies, adjusting approaches to attract and retain customer attention.
• Partnership and Sponsorship Development : Monitoring competitors’ involvement in events or sponsorships can help companies design more effective partnerships or identify untapped sponsorship opportunities.
• Brand Differentiation : Understanding how competitors position their brand helps companies identify ways to differentiate their own brand, highlighting unique values.
• Customer Service Improvement : Analyzing competitors’ customer service processes provides insights into how companies can enhance the efficiency and quality of their own customer service.
• More Effective Promotion Planning : Observing competitors’ promotional campaigns helps companies understand what works or doesn’t work in the market, allowing them to design more effective campaigns.

By leveraging this information, companies can optimize their strategies, respond to customer needs more effectively, and build a competitive advantage in the market.

4. Financial Situation Analysis.

Review competitors’ financial statements to understand their financial health. You need to focus on revenue, expenses, profit, and changes in financial trends.

Here are some actions that can be taken for this review:

• Income Statement : Observe competitors’ net income from the sales of products or services. Identify cost components such as production costs, operating expenses, and interest expenses.
• Balance Sheet : Analyze competitors’ assets, liabilities, and equity. Also, observe liquidity, solvency, and asset management efficiency.
• Cash Flow Statement : Review competitors’ sources and uses of cash. Pay attention to operational, investment, and financing cash flows.
• Financial Ratio Analysis : Calculate key financial ratios such as net profit margin, debt-to-equity ratio, and liquidity ratio. And compare these ratios with industry or sector standards.
• Changes in Financial Trends : Compare competitors’ financial data over multiple periods to see changes in trends. Observe revenue growth, cost changes, and fluctuations in net profit.
• Macro and Microeconomic Analysis : Consider external factors such as changes in economic policies, industry conditions, or market trends that can affect competitors’ financial health.
• Net Profit and Marginal Analysis : Review competitors’ net profit and margins to understand their profitability. Identify factors influencing net profit margins.
• Industry Comparison : Compare competitors’ financial performance with other companies in the same industry. Identify whether competitors consistently outperform or underperform compared to industry peers.

And you should know that leveraging a review of competitors’ financial statements to understand their financial health provides several benefits, such as:

• Competitiveness Assessment : Provides in-depth insights into the extent to which competitors can compete in the market, including their ability to withstand economic fluctuations.
• Identification of Strengths and Weaknesses : Enables the identification of competitors’ strengths and weaknesses in terms of revenue, costs, and profitability, helping the company understand areas where it can excel.
• Industry Comparison : Comparing competitors’ financial performance with industry standards helps evaluate whether they perform above or below the industry average.
• Strategic Decision-Making : Provides a data foundation for strategic decision-making, such as price adjustments, product expansion, or a focus on cost efficiency.
• Business Risk Understanding : Highlights potential risks the company may face by understanding factors that can affect competitors’ financial health.
• Financial Strategy Development : Provides guidance in designing the company’s financial strategy by considering competitors’ financial practices and results.
• Monitoring Trend Changes : Monitoring changes in competitors’ financial trends over time helps detect significant changes that can affect the company’s business strategy.
• Competitive Pricing Determination : Provides insights into how competitors set prices for their products or services, helping the company determine a more effective pricing strategy.

By leveraging information from competitors’ financial statements, companies can make more informed decisions, optimize business strategies, and better prepare themselves to face market competition.

5. Comparing Products or Services.

Compare the features, advantages, and disadvantages of competitors’ products or services with your own. Identify areas where you can compete or excel.

Here are the steps:

• Identify Product or Service Features : Observe the key features of competitors’ products or services and your own. Then, identify the essential elements that determine product functionality and value.
• Competitive Advantages : Examine the competitive advantages held by competitors’ products or services. Consider the uniqueness, quality, or added value they offer to customers.
• Product or Service Weaknesses : Recognize the weaknesses or limitations of competitors’ products or services. Find out if there are areas where competitors might be less effective or not meet customer needs well.
• Quality Comparison : Evaluate the quality of products or services from both sides. Note if there are differences in material quality, design, or execution.
• Price and Value Proposition : Compare the prices of competitors’ products or services with yours. Then, consider the additional value or incentives offered by each.
• Customer Response : Review customer reviews and feedback for competitors’ products or services and your own. Analyze how customers respond and rate their experiences.
• Customer Service : Assess the level and type of customer service provided by competitors and your company. Then identify areas where the company can improve service to gain a competitive advantage.
• Brand Differentiation : Observe how competitors’ and your brand are positioned in the eyes of customers. Consider how to differentiate your brand better.
• Innovation Potential : Find out if there is potential for product or service innovation on both sides. Then consider whether there are opportunities to introduce new features or improve quality.
• Opportunities for Value Uniqueness : Identify areas where your products or services can provide unique added value to customers, which may not be offered by competitors.

And leveraging the comparison of features, advantages, and disadvantages of competitors’ products or services with yours brings several strategic benefits, such as:

• Market Understanding : Provides in-depth understanding of market trends and preferences, helping the company adapt to changes and meet customer needs.
• Product Differentiation : Enables the identification of ways to differentiate your products or services from competitors, reinforcing unique added value.
• Adjustment of Marketing Strategies : Provides a foundation for designing more effective marketing campaigns by highlighting advantages that align better with customer needs.
• Price Optimization : Provides a basis for more effective pricing strategies, considering the advantages of products or services compared to competitors.
• Product and Innovation Planning : Enables the company to plan better product development or innovation according to customer needs and market trends.
• Quality and Service Improvement : Provides insights into areas where the company can improve product or service quality and customer service to compete more effectively.

By leveraging this information, companies can make more informed decisions, enhance competitiveness, and build more effective strategies to win customers’ hearts and gain a competitive advantage.

6. Marketing Strategy Analysis.

The next step involves analyzing the marketing strategies employed by competitors, including pricing, promotion, and distribution. Identify the strengths and weaknesses of their marketing strategies.

Here are the steps in conducting this analysis:

• Pricing : Observe the pricing models used by competitors, whether they employ high, low, or mid-range pricing strategies. Evaluate whether competitors offer discounts, loyalty programs, or other special pricing tactics.
• Promotion and Marketing : Analyze competitors’ advertising and promotion campaigns across various media channels. Then, observe competitors’ methods to enhance brand awareness and influence customer purchasing decisions.
• Product Distribution : Understand the distribution channels utilized by competitors, whether through retailers, e-commerce, or direct distribution channels. Evaluate the effectiveness of their distribution in reaching the target market.
• Market Segmentation : Observe how competitors segment the market and target various consumer groups. Understand if there is a specific emphasis on certain segments or if they are trying to reach a broader market.
• Social Media Campaigns : Review competitors’ social media activities, including the type of content they share, posting frequency, and how they interact with followers. Note the strategy of using social media platforms for marketing purposes.
• Customer Response Analysis : Examine customer reviews, feedback, or testimonials related to competitors’ marketing campaigns. Evaluate whether these campaigns receive positive or negative responses from customers.
• Product Availability : Review the availability of competitors’ products or services across various sales channels and locations. Understand if there are efforts to expand distribution or improve product accessibility.
• Strengths of Marketing Strategy : Identify aspects of competitors’ marketing strategies that are successful and provide a competitive advantage, such as brand strength, campaign creativity, or pricing accuracy.
• Weaknesses of Marketing Strategy : Observe areas where competitors may be less effective, whether in terms of strategic errors, lack of differentiation, or a lack of positive customer response.

This analysis provides an understanding of the marketing strategies employed by competitors, helping the company comprehend industry trends, discover opportunities for improvement, and identify ways to compete more effectively in the market.

7. Identify Competitive Advantages.

Identify competitors’ competitive advantages, such as technology, brand, or specialized expertise. Determine how to respond or emulate these advantages.

Here are some examples you can apply:

1. Technology.

Observe the technology competitors use to produce their products or services.

• Product Innovation : Build or enhance your products or services with the latest technology.
• Technology Partnerships : Form partnerships with tech companies to leverage expertise and latest developments.

Understand the competitor’s brand image and how it’s perceived by customers.

• Brand Differentiation : Build a strong brand focusing on unique values and messages different from competitors.
• Creative Marketing : Use creative and effective marketing campaigns to build emotional connections with customers.

3. Specialized Expertise.

Recognize specific expertise or excellence in a particular area held by competitors.

• Internal Expertise Development : Invest in developing specialized expertise within the company.
• Strategic Alliances : Form partnerships or alliances with companies or individuals possessing lacking expertise.

4. Operational Efficiency.

Observe if competitors have high operational efficiency in production or service delivery.

• Process Optimization : Evaluate and optimize internal processes to enhance efficiency.
• Supply Chain Improvement : Enhance relationships with suppliers and supply chain partners to ensure efficiency.

5. Product or Service Diversification.

Note if competitors offer a variety of products or services.

• Product Expansion : Expand your product or service portfolio to cover untapped areas.
• Offer Package Deals : Provide comprehensive or integrated product or service packages.

6. Cost Advantage.

Determine if competitors have a cost advantage in production or operations.

• Cost Efficiency : Evaluate and reduce operational costs to improve cost advantage.
• Competitive Pricing : Set competitive prices to attract customers.

7. Customer Responsiveness .

Find out actions competitors take in responding and interacting with customers.

• Customer Service Enhancement : Improve customer service to meet and exceed customer expectations.
• Customer Retention Campaigns : Execute campaigns focused on customer retention and loyalty building.

It’s crucial not only to identify competitors’ competitive advantages but also to respond to them in a smart and sustainable manner.

This approach helps companies stay relevant, competitive, and ready to face changes in the business environment.

8. Understanding Competitor Customers.

Understand who the competitor’s customers are and what customers value in their products or services. Identify if there are opportunities to attract customers from competitors.

Here are some actions you might consider:

• Competitor Customer Segmentation : Observe competitor customer data and identify customer segments they target. Understand demographic characteristics, purchasing behavior, and customer preferences.
• Customer Feedback Analysis : Examine competitor customer reviews on various platforms. Identify what customers appreciate about the competitor’s products or services and areas where they may be less satisfied.
• Product Value Appeal : Observe what competitor customers value in their products or services. Understand whether they prioritize pricing, quality, brand, or other aspects.
• Competitor Special Offers Analysis : Review special promotions, loyalty programs, or other offers provided by competitors to attract customers. Evaluate how customers respond to these offers.
• Customer Interviews or Surveys : If possible, conduct customer interviews or surveys to gain direct insights. Ask questions about their needs, preferences, and expectations regarding products or services.
• Purchasing Behavior Analysis : Review how competitor customers interact with the brand, whether through physical stores, online, or other sales channels. Identify purchasing preferences, buying cycles, and shopping preferences.
• Product or Service Comparison : Compare features and advantages of competitor products or services with yours. Determine where your product or service can add value or meet unfulfilled needs.
• Competitive Advantage Offerings : Identify opportunities to offer competitive advantages and attract competitor customers. Focus on needs or desires that may not be fully addressed by competitors.
• Competitive Pricing : Review competitor pricing models and assess if there are opportunities for more competitive pricing. Identify if competitor customers are price-sensitive and where adjustments can be made.
• Customer-Focused Marketing : Design marketing campaigns focused on customer values and needs. Communicate specific advantages of your product or service to meet those customer expectations.

By deeply understanding who the competitor’s customers are and what they value, a company can identify relevant marketing opportunities, formulate more effective marketing strategies, and attract customers from competitors more successfully.

Please also check out other interesting discussions on “ Customer Needs that Need to be Known “.

9. Compare Operational Performance.

Compare the operational performance of competitors, including operational efficiency and supply chain. Also, observe their HR policies and management practices.

Here are the steps to conduct this comparison:

• Operational Efficiency : Review the operational processes of competitors, including production, distribution, and customer service. Compare operational efficiency in terms of time, cost, and quality of products or services.
• Supply Chain Analysis : Evaluate the competitor’s supply chain from upstream to downstream, including suppliers, production, distribution, and customers. Identify potential risks and opportunities in their supply chain.
• Cost Efficiency : Compare overall operational costs with competitors, including production costs, distribution costs, and other expenses. Evaluate whether there are areas where the company can achieve better cost efficiency.
• Quality Determination : Review the quality standards implemented by competitors in the production and delivery of products or services. Evaluate whether there are significant quality differences between your company’s products or services and competitors.
• Capacity Planning : Analyze the production and distribution capacity of competitors to understand how they can respond to market demand fluctuations. Identify capacity planning strategies used by competitors.
• Human Resource Management (HRM) : Review competitor HR policies, including recruitment, training, and employee development. Evaluate the level of employee satisfaction and engagement, which can influence operational performance.
• Employee Development Strategies : Observe how competitors develop and motivate their employees, including incentive policies and reward programs. Identify HR management practices that can be applied to your company.
• Organizational Flexibility : Review how well competitors can adapt to changes in the market or external conditions. Identify the extent to which the competitor’s organization can adapt to changes in trends or unexpected events.
• Technology Adoption : Evaluate how much competitors adopt the latest technology to improve operational efficiency. Identify potential technology investments that can provide a competitive advantage.
• Sustainability and Business Ethics Policies : Review sustainability policies and business ethics practices of competitors. Identify how sustainability and business ethics can affect customer perceptions and brand image.

Conducting this comparison helps companies gain in-depth insights into the operational strengths and weaknesses of competitors, enabling them to identify improvement opportunities and optimize business strategies.

10. Create a Monitoring System.

Establish a continuous monitoring system to track any changes in competitors’ strategies, products, or services. This is crucial to swiftly respond and adapt your company’s strategy.

• Identify Monitoring Criteria : Determine key criteria to monitor, such as price changes, new product launches, or competitors’ new marketing strategies.
• Select Information Sources : Choose the most relevant information sources, including competitors’ websites, industry publications, social media, and customer surveys.
• Utilize Online Monitoring Tools : Employ online monitoring tools to automate information collection, such as Google alerts, social media analytics, or industry monitoring software.
• Form Monitoring Team : Assign a team or individuals responsible for monitoring competitors and ensuring an efficient flow of information.
• Set Monitoring Frequency : Establish a regular schedule to check and monitor competitor information, whether it’s daily, weekly, or based on your business needs.
• Analyze Changes : Analyze each detected change, considering its impact on the market and competitors’ positions in the industry.
• Evaluate Customer Responses : Observe customer responses to competitors’ changes, such as online reviews or direct feedback.
• Focus on Competitive Advantages : Keep the monitoring focused on competitors’ competitive advantages, whether it’s product innovation, pricing policies, or marketing strategies.
• Adjust Strategies Quickly : Implement rapid response procedures so the team can quickly adjust the company’s strategy when necessary.
• Long-Term Trend Analysis : In addition to tactical changes, analyze competitors’ long-term trends to understand the direction of their strategies and adjust your plans more comprehensively.
• Strategic Flexibility : Ensure your company’s strategy is designed with flexibility to allow quick adjustments in line with market and competitive developments.
• Consider Internal Changes : Besides monitoring competitors, also consider internal changes within your organization that can either support or hinder responses to competitors’ changes.

By forming an effective monitoring system, companies can stay at the forefront in facing market changes, ensuring that business strategies remain relevant and competitive.

That’s all, and I hope it’s helpful.

How to Conduct Successful Market Analysis

How to Make Market Segmentation

How to Expand Distribution Channels in Marketing

SWOT Analysis Examples for Business

How to Create a Marketing Budget

ROI: How to Calculate Return on Investment

Key Metrics Examples in Business Plan

Customer Needs Examples in Business

6 Steps to Create Inspiring Business Goals

Financial Objectives of a Business Examples

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Mastering the Game: Unveiling Effective Competitive Analysis Examples for Business Success

Home Blog Media Monitoring Mastering the Game: Unveiling Effective Competitive Analysis Examples for Business Success

Posted on April 3rd 2024

Ian David | 14 min read

Ever heard the phrase “Get a leg up on the competition”, “Gain a competitive advantage” or “Always stay one step ahead” ?

These are all popular sayings that involve keeping up with the competition.

In business, this means studying the competition. It lets you stay on top of industry trends and the strategies that lead to success.

We call this competitive analysis.

Doing a competitive analysis can give you the insights you need about your competitors. You can learn about their strengths, weaknesses, successes, and failures.

Here, we provide competitive analysis examples to help you make informed decisions and stay ahead in your industry.

What Is a Competitive Analysis?

The concept of competitive analysis is pretty self-explanatory. It’s the process of analyzing competition within your niche.

Doing so allows you to identify the main market players and what strategies they’re using to stay competitive.

By studying your competitors, you can learn about their products, target customers, and marketing. This helps inform your own business strategy.

Beyond discovering the strengths of your competitors, you may also uncover weaknesses and decisions they made that may have hurt their bottom line.

As a result, you can learn from their mistakes and only use strategies that work.

Why Is Competitive Analysis Important?

Conducting a competitive analysis is critical for businesses looking to survive and thrive in a competitive market.

Every market has more than one company selling their products or services.

So, if you don’t know what your competitors are doing to win customers in your target market, it’s hard to keep up. You risk falling behind and losing your edge.

What to Include in a Competitive Analysis

So, now you know what a competitive analysis is and why you need to conduct one to stay competitive in your industry. But what should you include in yours?

• Details about your products or services compared to those of your competitors
• An analysis of marketing and social media strategy
• A list of competitors in your industry
• A description of your target market
• Market share, sales, and revenue
• Differences in customer ratings
• Pricing comparison

At the core of every competitive intelligence strategy is data collection and analysis .

After gathering data about your company and competitors , you can make comparisons, analyze differences, and identify key trends.

Doing so helps drive decision-making. That said, it’s no surprise that data analytics help businesses make decisions 5x faster .

How to Conduct a Competitive Analysis

A well-executed competitive analysis usually follows these five steps:

1. Identify your competitors

There’s no competitive analysis without competitors. So, make sure you compile a list of companies that offer similar products or services to yours. If you’re in a really competitive industry, list at least five key competitors.

It’s also important to know the different types of competitors: direct competitors, indirect competitors, and replacement competition.

Your direct competitors are companies that provide similar products to the same target market at a similar price point. Think Apple and Samsung.

Your indirect competitors, on the other hand, are a bit more difficult to pinpoint. They’re companies that target the same market and audience as you, but they offer different products.

Consider AMC Theaters and Netflix. One is a movie theater, and the other is a streaming service.

They both provide entertainment through movies, but they do so through different mediums. But even though they don’t offer the same product, they often compete for the same customers.

For people who want to stay in and watch a movie, a streaming service is a go-to option. On the flip side, when consumers want to socialize and go out, they may choose to go to a movie with friends or family.

Replacement competition consists of competitors who have the potential to replace your product by offering something different altogether.

For example, Uber is threatening to replace taxis. Airbnb has disrupted the hotel market.

2. Conduct a competitor SWOT analysis

Performing a SWOT analysis can help you uncover your competitors’ Strengths, Weaknesses, Opportunities, and Threats.

Contrast their weaknesses against your strengths. What opportunities are they missing? How can you capitalize on them?

Furthermore, analyze their strengths and threats to gauge the overall market conditions to see how you can best dominate them.

3. Conduct market research

Do both primary and secondary market research. The first is from your customers, such as surveys, focus groups, and interviews. The second is from available sources, like competitors’ websites and company records.

To get a full view of your industry, it can help to think creatively. Spend time looking at LinkedIn posts or podcasts by leaders in your niche.

Some of the best information is shared in thought-leadership content .

4. Compare product features and marketing

Compare your products with your competitors’ products. Consider factors like:

• Customer support
• Product quality
• Ease of use

Then, compare your marketing strategy to that of the competition. This includes social media, website copy, ads, press releases and newsletters , and product copy.

5. Use technology to keep your finger on the pulse of competitors and your industry

Collecting data is a huge part of competitive intelligence, but managing and visualizing large amounts of data can be tedious. Leverage technology to streamline data visualization and analysis.

For example, consider using a competitive analysis tool to help you track conversations surrounding your competitors and measure your performance against them.

You can also use competitive intelligence tools to track what competitors do. They help you find market opportunities and potential threats. These tools act as a compass to guide you through the competitive landscape, unveiling hidden opportunities and threats.

In your quest to gather competitor data, you are likely to visit to their website and we all know that leads to seeing thousands of ads about them later. It is always a good idea to hide your IP address when you visit competitors’ websites, so it is almost like you were never there.

7 Real-World Competitive Analysis Examples

Here are examples of competitive analyses done right.

1. Vibe by California

Vibe by California is a cannabis dispensary based in Stockton, California. Vibe aims to be a market leader in the cannabis industry. It started by making a dispensary business plan. The plan outlines its unique selling points, how it can fill market gaps, and how it’ll succeed in the dynamic cannabis market.

Then, Vibe identified its direct competitors. They are other dispensaries in the Central Valley of California.

The dispensary analyzed factors such as product offerings, pricing, customer demographics, marketing strategies, and online customer reviews to understand the strengths and weaknesses of each competitor.

This analysis helped Vibe find ways to differentiate its products and offerings from those of its competitors.

For example, Vibe sells company merch to build brand awareness and foster customer loyalty.

Vibe also offers a rewards program that allows loyal customers to save on purchases and get early access to new products,

Remote is a company that offers human resource information systems (HRIS) software. HRIS software allows businesses to manage information on their employees, automate workflows, and streamline HR processes.

Its main competitors are Deel, Gusto, and Rippling.

To identify opportunities in the HR technology market, Remote conducted a competitive analysis. It found that its target market prefers to try a solution before they commit to purchasing the full version.

Remote realized that its competitors offered this option. So, it started letting potential customers create a free account to try the software.

The HR tech company also analyzed its competitors’ pricing strategies. For example, for its Employer of Record (EOR) product, Deel charges $599 per month. To stay competitive in the industry, Remote charges the same price per month for its EOR offering.

3. Wyoming LLC Attorney

An LLC asset protection lawyer can conduct a competitive analysis by identifying other law firms and legal service providers that specialize in asset protection services.

They’d gather info about their competitors. This would include their range of services, prices, reputation, client testimonials, and marketing.

A trust and LLC attorney would also assess the qualifications and expertise of the lawyers and staff working at these competing firms.

Let’s take Wyoming LLC Attorney as an example. This law firm has gained a competitive advantage in the asset protection legal space by analyzing its competitors and identifying opportunities for differentiation.

This includes examining how other law firms strategically incorporate limited liability structures into their operations.

The goal was to explore the subtle strategies of integrating LLCs. It offered a full understanding of how these limited-liability structures become key.

They are key in safeguarding assets and skillfully navigating legal challenges. This approach helps ‌law firms protect against legal risks and mistakes.

For example, the Wyoming LLC attorney saw that its competitors didn’t offer different resources for people who weren’t yet ready for a consultation.

So, the founder created resources on the Wyoming LLC Attorney website. It includes a blog, a guide on how to get an employer ID number (EIN), and a page about the benefits of a Wyoming LLC.

This also helps the law firm’s SEO strategy. Offering site visitors relevant content that includes industry keywords allows Wyoming LLC Attorney to rank in search results .

As you can see in the screenshot, when you search “asset protection lawyer Wyoming” , Wyoming LLC Attorney shows up at the top both in organic and paid search results.

4. Delta Airlines

Delta Airlines conducted a competitive analysis to inform its pricing strategy.

This is crucial for airlines because they’re in a dynamic market where flight tickets change every day based on external factors.

For example, if a competitor of Delta Airlines increased pricing for a particular route, it’d quickly do the same. This is also true when prices drop.

Delta also uses customer information in its pricing adjustments . For example, using tracking technology on its website and app helps Delta monitor the search behavior of individual users.

When a customer repeatedly searches for the same flight details, it means that they may be interested in booking that particular flight.

As demand for a particular flight rises, the airline will raise its prices. It won’t be the most expensive option. It will be in the middle from a price perspective. This is to win over target customers.

Wendy’s consistently analyzes its competitors to stay ahead in the fast food industry.

For example, it uses a social listening tool to monitor what people are saying about the company. But they don’t stop there. They also use it to watch what their competition is doing.

In fact, Wendy’s is known for its snarky tweets about its competitors.

Using social listening tools allows it to monitor its competitors’ accounts so that it doesn’t miss out on opportunities to take a humorous jab at their weaknesses.

Amazon increases retail sales with real-time price monitoring. This allows the online retail giant to adjust prices in real time to match or beat competitor pricing (also known as dynamic pricing ).

If you’ve ever used Amazon, you’ve likely seen this strategy in action.

For example, say that you added an item to your cart and left it for a few days. You might get a message from Amazon saying that the price has increased or decreased.

The strategy allows Amazon to stay ahead of the competition in the fast-paced e-commerce landscape.

7. Coca-Cola

Here’s another competitive analysis example. Coca-Cola is a company that regularly conducts competitive analysis to maintain its dominance in the beverage industry.

By doing market research and using competitive intelligence tools, Coca-Cola noticed that its competitors were offering healthier beverage options due to the target audience’s concerns about consuming sugary drinks.

As a result, Coca-Cola began expanding its product line. It offered bottled water, flavored water, and zero-sugar sodas like Coke Zero and Diet Coke. They’ve also dabbled in healthier acquisitions such as Fairlife (ultrafiltered milk) and Vitaminwater.

Use Competitive Analysis To Drive Business Success

As a business owner looking to stay relevant in your industry, competitive analysis should always be a top priority.

Analyzing your competitors can be the difference between a brand that’s surviving and a force that’s dominating your market.

How often you conduct your competitive analysis will depend on your industry, market dynamics, and business goals.

Regardless of the frequency, the key is to create a reliable system and a ‌ competitive analysis tool to ensure your insights are timely, relevant, and actionable for driving business success in a dynamic and competitive market.

Ian David started his career in brick-and-mortar retail management, which quickly included eCommerce and digital marketing as well. He is an avid reader and a self-taught expert in SEO and content marketing. He writes for several publications on a variety of digital marketing topics. Recently, his focus has been on using influencer and affiliate marketing to drive more conversions.

Content Marketer @ShaneBarker.com

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How to Write an Assisted Living Business Plan + Free Sample Plan PDF

Elon Glucklich

7 min. read

Updated April 3, 2024

Free Download: Sample Nursing Home Business Plan Template

With the U.S. senior population expected to reach 80 million by 2040 , the demand for assisted living services is skyrocketing. 

Seniors are living longer, and many are looking for amenities like health care, fitness, and recreation services as they age. This surge in demand, plus consistently high occupancy rates in well-run facilities, means starting an assisted living facility or improving your existing facility can be an incredibly lucrative business venture.

However, achieving success requires more than just filling rooms. From ensuring the health and wellbeing of your residents, to navigating license and permitting requirements, to understanding your market to securing funding for your facility, you’ll need to think strategically to ensure your care facility reaches its full financial potential. 

A business plan organizes your market, customer, and competitive research, so you can prioritize the most profitable services and develop marketing strategies to attract the right residents. Think of it as your roadmap for defining a successful business model. It’s the type of proof of concept that lenders or investors will need to see before they’ll feel comfortable funding your venture .

• What should you include in an assisted living business plan?

Here are a few sections we recommend including in an assisted living facility business plan:

Executive summary

Market analysis, competitive analysis, marketing plan, financial plan.

No two assisted living business plans will be exactly alike. A residential assisted living business owner’s market research and growth strategy will vary depending on the market or markets they’re operating in. And while some assisted living developers own large portfolios of facilities in multiple locations, others may be focused on a single location.

If you’re starting a new assisted living business, it’s likely that you’re seeking a bank loan or outside investment. Business plans written for funding typically follow a detailed and proven structure to impress lenders and potential investors.

Below we’ll highlight some of the most important business plan sections for an assisted living business. 

Your executive summary is your facility’s elevator pitch. 

It’s the first, and sometimes only, section of your business plan that a lender or investor will read. So your executive summary needs to be engaging.

In no more than two pages, draw the reader in with an overview of your business opportunity and mission. Why are you passionate about serving seniors? What problems are you solving for residents and their families?

Describe what sets you apart. Maybe you’re opening a new facility in a location with pristine views and landscaping. Or maybe you’re offering innovative care programs.

Briefly mention your team’s qualifications and commitment to resident care. Touch on the factors that will be key to your success, such as hiring highly trained staff or introducing programs tailored to residents’ needs.

With significant startup costs to run an assisted living facility, it’s crucial that you understand both the broader senior living industry and the dynamics in your market. The market analysis section is where you show potential funders of your project that you’ve done your research.

Get to know your potential residents. Start by analyzing the size and projected growth of the senior population in your area. The U.S. Census Bureau is an excellent source of demographic information, and should include the age breakdown of your community.

It’s also important to determine the characteristics of your potential residents. Are you targeting:

• Active seniors seeking independent living with some support
• Seniors dealing with, or recovering from, surgeries or other medical issues
• Seniors with memory care and other intensive needs

You may be targeting a combination of these services in your assisted living project. But no matter who your ideal customers are, you need to demonstrate through your study of industry and demographics trends that there is a demand for the services you’re offering. 

Identifying your competition is crucial if you’re planning an assisted living facility. A lender or investor will expect your business plan to analyze your facility’s competitors, and demonstrate that there’s room in the market for a new entrant.

Start by researching and listing your competitors. These could be:

• Other licensed assisted living facilities
• Independent living communities
• Adult foster homes
• In-home caregiving services

Note their size, services offered, and any specializations they offer. What are their strengths and weaknesses? Are they large chains or smaller, family-owned facilities? 

Consider factors like:

• Level of care

Be honest about your facility’s strengths and weaknesses compared to the competition. Do you offer a unique activity program? Are your rooms more spacious?  Focus on what sets you apart.

Answering these questions will help you determine how to stand out and win over potential residents and their families.

Remember: Solid research is key. Back up your assumptions about your target market and competition with data and analysis. This shows potential investors and partners that you have a strong grasp of the assisted living landscape.

By the end of your competitive analysis, you should be able to state why a family would choose you over your competitors. 

This is where you turn your market and competitive research into an actionable plan to attract residents to your facility.

By now, you should have plenty of information about the senior living market in your area. Now it’s time to document how you’ll reach families seeking senior care services for their loved ones.

Start by thinking broadly about tactics to reach your target customers:

• Networking with healthcare providers and elder care professionals to spread awareness of your facility
• Advertising online, through television commercials, in printed publications and on social media
• Appearing at community events

Each of these strategies accomplish the goal of boosting your visibility. Make sure your messaging through these marketing channels emphasizes the factors that set your business apart from competitors. They might include: 

• A focus on personalized care
• Top-of-the-line amenities
• A vibrant social calendar

Additionally, spend some time in your marketing plan to discuss your pricing and sales process. Document your pricing and how it compares to your competition. And detail how you will turn prospects into residents. Will families tour in-person? Can they schedule virtual consultations? The plan should detail the entire journey prospects will experience, from initial awareness of your facility to moving in.

Finally, remember to track the results of your marketing efforts. This helps you refine your strategy and get the most out of your marketing budget.

This section is where your careful planning turns into actual numbers . While it might seem intimidating, don’t worry – you don’t need a finance degree to get this right. Here’s what a typical assisted living financial plan includes:

Sales forecast : Project occupancy rates and income from resident services. Be realistic, especially in the first year, and consider different pricing tiers if applicable.

Expense budget : List all planned spending, including:

• Staffing (one of your largest costs)
• Food, maintenance, and supplies
• Insurance, marketing, and licensing fees
• Legal and professional services

Profit & Loss (P&L) : This combines income and expenses to show if you’re profitable.

Cash flow statement : Crucial for managing bills. Shows when money comes in and out, so you avoid cash shortages.

Balance sheet : This snapshots your facility’s financial health, listing assets (like your building), liabilities (like loans), and overall equity.

Important notes

Startup costs : If seeking funding, detail costs like renovations, equipment, and initial staffing.

Assumptions: Be transparent about any predictions you’re making (occupancy rates, growth, etc.). This adds credibility.

Use of funds: Explain to potential investors exactly how their money will fuel your success.

Industry-specific costs: Research sample financials for assisted living facilities to ensure you cover all your bases.

Remember, your financial plan is a living document. Revisit it regularly to track your progress and adjust your strategy as needed.

• Download your free assisted living one page sample business plan

Download our assisted living sample business plan right now for free. You can download other medical and health business plans , or check out Bplans’ collection of over 550 free sample business plans to find more inspiration. If you’re considering other types of senior care businesses, read our article on how to write a home health care business plan .

With tons of opportunity, but significant upfront costs, it’s crucial to do your homework before investing funds in your assisted living plan. Writing a business plan is one of the best ways to put yourself on a path to a financially viable business.

And the business plan is an absolute must if you’re looking for outside funding to help you turn your dream into a reality.

See why 1.2 million entrepreneurs have written their business plans with LivePlan

Elon is a marketing specialist at Palo Alto Software, working with consultants, accountants, business instructors and others who use LivePlan at scale. He has a bachelor's degree in journalism and an MBA from the University of Oregon.

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