If you’re like most people, you can feel your market getting more and more competitive with each passing year. New startups emerge. Established companies steer into your lane. And all the while, you continue to go head-to-head with familiar foes.
Now more than ever, if you’re committed to delivering differentiated value to your market, you have to understand your competitive landscape. Across sales, marketing, product, and everywhere in between, your colleagues need — at the very least — an up-to-date picture of (1) who you’re going up against and (2) where each competitor stands in relation to one another.
Competitive landscape analysis makes that possible.
By the end of this quick guide, you’ll have an answer to each of the following questions:
- What is competitive landscape analysis?
- What kinds of data are involved in competitive landscape analysis?
- How do you get started with competitive landscape analysis?
Let’s jump in!
What Is Competitive Landscape Analysis?
Competitive landscape analysis is the ongoing practice of analyzing your market in order to understand who you’re competing with and where each company stands (including your own) in relation to the rest of the pack. More specifically, conducting an analysis of your competitive landscape means scrutinizing each player in your market along the following dimensions:
- Growth and trajectory
- Marketing reach (traffic, social media, etc.)
- Positioning and messaging
Growth & Trajectory
Competitive landscape analysis begins with a combination of firmographic and financial data. For each competitor, answer the following questions:
- When were they founded?
- How many employees do they have?
- How much funding have they raised?
- What is their estimated annual revenue?
- Are they private or public?
- If they’re public, what is their market capitalization?
Once you’ve answered each of these questions for each of your competitors, you’ve begun to build a strong foundation for your analysis. At a minimum, it’s important to differentiate between firmly established players — i.e., competitors founded years ago that have a relatively high number of employees and relatively high ARR — and emerging startups — i.e., competitors founded recently that have relatively few employees and relatively low ARR. Among the startups in particular, pay attention to which competitors are accumulating funding at high rates.
Employee headcount, funding, annual revenue — as important as these metrics are, they alone won’t tell you the full story of your competitive landscape. To get a sense of who’s attracting the attention of your target audience, look at each competitor and answer the following questions:
- According to Alexa Rank, how popular is their website?
- In terms of followers and engagement, how are they performing on social media?
Alexa Rank is a metric that indicates the popularity of a given website. As a website gets more and more popular, its Alexa Rank goes lower and lower. (Google, at the time of this writing, has an Alexa Rank of 1 — it’s the most popular website in the world.) Identifying the top websites in your competitive landscape gives you an idea of who’s in control of the conversation.
Of course, there’s more to a company’s online marketing presence than their website. Just because a competitor of yours is doing relatively poorly from a traffic perspective, doesn’t mean they’re failing to generate buzz on sites like Twitter and LinkedIn. Going one by one through each of your competitors, take note of (1) which platforms they’re using to publish content, (2) how many followers they have on each platform, and (3) how much engagement — in terms of likes, shares, views, etc. — they’re getting on each platform.
Positioning & Messaging
At this point in your competitive landscape analysis, you’ve begun to scrutinize your competitors in terms of firmographic data, financial data, and marketing data. At a high level, this information tells you where each of your competitors stands in the market at large.
What remains to be seen is (1) how each competitor positions themselves in the market at large and (2) how each competitor articulates their positioning to your shared target audience.
Wrap up this initial stage of your analysis by answering these questions for each competitor:
- How do they position themselves?
- How do they translate that positioning into prospect-facing messaging?
As a reminder, positioning is all about defining the differentiated value that you bring to your market. You can think of positioning as a structure or framework that guides you in your efforts to communicate the value (and determine the price) of your product. Mailchimp, for example, positions itself as an all-in-one marketing platform for businesses with tight budget constraints. Understanding how your competitors position themselves enables you to deliver something unique and stand out to your prospects.
Messaging is the articulation of your market position — it’s the vehicle that takes the unique value of your product and drives it into the hearts and minds of your prospects. Whereas positioning, for the most part, remains static over time, messaging can evolve dramatically. Closely observing the evolution of your competitors’ messaging enables you not only to anticipate strategic changes, but also to ensure that your own messaging never grows stale.
Get Your Free Competitive Landscape Report From Crayon
At this point, you know why it’s important to analyze your competitive landscape as well as what kinds of data you need to collect in order to make it happen.
But how do you actually get started with competitive landscape analysis? Knowing what kinds of data to collect is one thing. Collecting that data and assembling it in a way that allows you and your colleagues to extract meaning and draw conclusions is something else entirely.
Say hello to your new best friend: The Competitive Landscape Report.
Courtesy of Crayon, your free competitive landscape report includes everything we’ve discussed here today: firmographic information, financial data, website popularity, social media performance, and historical snapshots of positioning and messaging. Each of these outputs helps to build the strong foundation required for an effective competitive landscape analysis.
And yes — it’s completely free.
Upon requesting your report, you can select up to ten competitors, allowing you to quickly understand the threats they pose in your market. Website and social engagement data is provided for each competitor, and it’s visualized to show metrics like social media followers, Alexa Rank, and overall company size.
This data, especially when combined with the firmographic data provided, can help you determine which competitors have strong social reach, how quickly they’ve been able to gain traction in their market, and whether they’re able to punch above their weight class to capture market presence.
For example, one could reasonably assume that a startup with an Alexa Rank and social reach that outguns more established/better-funded companies is making outsized investments in their digital and social strategies. Conversely, if you find yourself ahead of many of your competitors in terms of funding/personnel but behind in Alexa Rank, it may be time to kick off some SEO-driven initiatives.
The free report also provides an extensive database of website messaging and positioning changes. Browse through timelines of changes that your competitors have made to their most important marketing vehicles — their homepages — and see how their value propositions have evolved over time.
Understanding the history of your competitors’ messaging is key to navigating where their messaging (and, ultimately, their overall market strategy) is going. This is the first step in creating a more proactive approach to competitive analysis and positioning.
Looking to gain an understanding of your market and where your organization fits in? Request a free competitive landscape report today.
Originally published by Ben Cope on June 8, 2020. Last updated by Conor Bond on February 17, 2021.
Topics: Competitive Analysis