When it comes to competitive analysis, it’s relatively easy to see what happening out there but a lot harder to know what to do about it. Skipping the hard part can lead to limited benefits or outright bad decision making.
Here are some examples of the varying degrees of thoughtfulness that can be given after recognizing what a competitor is up to, and the implications.
Blind following: A direct competitor is doing this, therefore we should do it too. Observing what a company is trying usually affords no insight into results. Even when there are results offered as part of an interview or case study, consider the source carefully. They are often presented to paint the sunniest picture possible.
The best case outcome when chasing companies in your market is to match their functionality but to be behind on timing. There may be a time and a place to follow but in the long term it’s a losing strategy. The trouble is that when you see your direct competition doing something enviable it’s hard to resist the desire to duplicate it, especially when you can see the potential so tangibly.
Another option is to out-do the competition’s idea. This is easier said than done but if you pull it off you’ll not only put yourself in a great position but also nullify the competitor’s effort to some degree. In most cases it’s not enough to be incrementally better than the first mover though. You’ve got to cover the topic at hand or address the need in the marketplace so well that there’s no question who did it best and to make it difficult for the next company to outdo your effort.
A better option would be looking for relevant companies in non-competitive industries. If a company is innovating outside of your marketplace, copying and adapting their idea is a great strategy. The extra effort required is to see how the principles involved translate to you and your industry before diving in.
Another way to use competitive intelligence without following the pack blindly is to copy the strategy but vary the tactics. If you can diagnose the reason why your competition is doing a certain thing you can evaluate it and, if it fits for you, gain a shortcut to generating successful ideas.
For example if you sold Halloween costumes and sought mentions to improve your SEO strength, you might observe your competition offering free family-friendly costumes to mommy bloggers for them to review. They are engaging with publishers within the industry in order to encourage coverage and to generate links and social mentions. For your company, you might find the best way to utilize that strategy is to reach out to bloggers to ask them to collaborate on a ‘best of’ list of costumes to be published on your site. Potentially the collaborators would be credited within the article, offering an incentive for them to promote the piece. It’s still engaging with publishers to encourage coverage but finding a different way to get there.
Finally, you can use research on the competition to figure out what not to do. We are all looking for a Blue Ocean Strategy, or the chance to carve our a niche and dominate at what we do best. If you look at what your archival is doing you can better understand their positioning strategy. Sometimes the best response is to run in a different direction. If they are staking their claim to a territory you’re not interested in, you can take steps to distinguish yourself from their position.
With a little thoughtfulness, competitive analysis can be a great tool for business planning. The key is resisting the lazy temptation to copy first and ask questions later.