Completing a competitor audit is crucial to the success of your business because it allows you to expose your competitors weaknesses so you can differentiate your business and stand out in the marketplace.
The first step in completing this audit is to compile up with a list of businesses that offer similar products or services as yours.
Depending on your industry, this list may be quite lengthy.
However, only list the business that fit directly within your category. You want your list to be comprehensive, but not overwhelming.
There are 3 types of competitors to look for:
The first are Direct Competitors:
These are businesses exactly the same as yours. They offer the same product or service to the same audience, and may even be in the same geographical location.
The second are InDirect Competitors:
These are companies that offer a similar product to yours, but they may serve a different purpose or they may target a different audience. For example, if you sell hamburgers, an indirect competitor would be a sandwich shop. You have different products, so the sandwich shop would not be a direct competitor. However, they could still take some of your business if they can convince someone to buy a turkey sandwich instead of your hamburgers.
The third type are Tertiary competitors:
These are companies who sell products or services that are vaguely similar to yours. It’s still important to identify these businesses because if they decide to make a change, they could become a direct or indirect competitor. So for now, just keep your eye on them.
Now that you know what type of competitors to look for, here are the top 5 methods of locating them so you can begin your competitive audit.
Method #1: Search For Them
Start with the most obvious and just google it. Begin by searching for the products or services you offer. Next search for terms and phrases related to your business. And finally compile a list of keywords that relate to your products or services and start Googling. You will quickly have a list of potential competitors.
Method #2: Pay Attention to Search Ads
While you are Googling your keywords and phrases, pay attention to the ads listed above, below and to the side of your search results. These ads will most likely be from competitors that have targeted the keywords you are searching. Also, make sure you do the searches multiple times since not all the ads will appear on every search.
Method #3: Dive Into Social Media
Everyone and every business has a social media presence these days. There are so many channels, groups, communities, forums, chats, posts, and blogs to analyze that it can quickly become overwhelming.
Start by searching on facebook for competitor business pages, then move on to youtube, Twitter, and Instagram.
From there you will start to find groups and links to blogs to follow. Pay close attention to the comments section. This is where your audience hangs out and talks about the competition.
Method #4: Talk to Your Customers
When you make a sale, ask the customer how they heard about you and if they have purchased the same product or service from a competitor in the past.
Find out why they chose you over them. This will help you further develop your marketing message and value proposition.
Method #5: Review Trade Publications and Trade Show Vendors
If there are any publications in your industry, both physical or digital, make sure you’re reviewing these often.
New or existing competitors may submit articles or place advertisements to help promote their business.
Take a look at vendor lists for trade shows that focus on your industry. This could produce a list of up and coming brands that may become direct or indirect competition.
So there is it guys. Once you have located your direct and indirect competitors, your next step is to complete a competitor audit so you can expose their weaknesses, differentiate your brand, stand out in the marketplace, and become the industry leader in your space.