The first thing on any business's to-do list is growing its customer base. Growing your business means more conversions, revenue, and expansion. Surprisingly, not many businesses use competitive analysis to expand their customer base, even though it's one of the most efficient ways to do so.
For smaller businesses, in particular, time is of the essence because they don't have a lot of money to keep their doors open indefinitely. Below, we show you exactly how very small businesses can use competitive analysis to quickly grow their customer base.
What is a competitive analysis?
A competitive analysis looks at your industry competitors and their strategies to determine what their strengths and weaknesses are. It also empowers your business to identify what it does better than any of its competitors. This unique value proposition is what you would emphasize to market to your target demographic.
How to perform a competitive analysis.
Performing an analysis is easy. Here's how:
Use tools like SEMrush, KeywordSpy, and Ahrefs to discover basic information about your competitors, such as their best-performing keywords and backlinks.
Analyze your competitors' websites, taking notes on whether or not they have a blog and what kind of content they feature. You can use tools like BuzzSumo to see what content is trending and performs best in social shares, and where your competitors are getting their links from. The tool also allows you to identify key influencers you can reach out to for your own content-promotion activities.
Determine your competitors' market positioning (i.e. who their ideal client is) by reading their blog, following them on social media, and subscribing to their newsletter. Armed with this information, you have an accurate idea of who to target to take market share away from your competition.
Look at how your competitors price their products. Don't charge too much to price yourself out of the market, but also provide high-quality and professional services to warrant charging a fair price. When you're just starting out, you'll want to price your services reasonably lower, but as you build experience and a great portfolio, feel confident in accordingly raising your prices to reflect the added value and expertise that you're delivering to your clients. Here's a helpful article for more information on coming up with the right pricing strategy.
See how they handle shipping (for example, do they offer free shipping, free shipping for a certain price point, and do they let customers track shipments?).
Read their customers' reviews to see how good or bad their customer service is.
How to use the data you've gathered.
You now have a wealth of information about the competitors in your space, so you're fully equipped to make good use of it to swell your customer base. There are several ways to take market share from your competitors:
Show your target audience more affection: If, from reading competitor customer reviews, you notice the competition fails to show its customers appreciation, you can run promotions or special offers that do. This could include offering all new customers 25% off or a gift with each first-time purchase.
Create a blog or better content: If your analysis shows that your main competition doesn't have a blog, you can capitalize on that mistake and position yourself as a thought leader in your industry. If they do have a blog, thanks to the content analysis you have performed earlier, focus on writing and publishing more in-depth and authoritative content. You can achieve this by executing Brian Dean's Skyscraper Technique.
Get bloggers and influencers to promote your product: Influencer marketing is one of the most efficient techniques to grow your market share. This is when influential people with big followings on the web (social media, blogging, etc.) speak positively about your brand to their followers. According to a study mentioned in AdWeek, influencer marketing can produce threefold lifts in coupon redemption rates and drive a significant number of people to in-store visits. Simply reach out to bloggers and others with influence on the web to see if you can come to a mutually beneficial agreement about product promotion.
Offer superior customer service: Let's say you've monitored your competitors' social accounts, and their customers are always upset about lousy customer service. This is a golden opportunity for your brand. You could try implementing 24-hour customer service, LiveChat on your site, and self-help resources such as FAQs and guides.
You'll grow your customer base when you take market share from your competitors. By taking the time to do a competitive analysis, you'll be able to zone in on the weaknesses of the competition and determine exactly how you can fill those voids with your brand.
Have you ever performed a thorough competitive analysis of your competition? What did you find helpful? Tell us in the comments below!