Setting up a new online business can be thrilling. Entrepreneurs today do research on their target markets and competitors. They do so to understand the competitive landscape better.
Yet, how do you go about doing competitor research?
As you read this blog post, you will learn simple yet effective ways to conduct research for your online business.
Now, let’s begin!
What exactly are a competitor and market research?
Understanding your competitors, what they’re offering, and where they’re positioned on the market is the goal of competitor research.
Research like this is essential for any business, but it’s crucial for online businesses. Small businesses can now compete with large ones, thanks to the internet, which has levelled the playing field.
You can make your business stand out from the rest by doing proper research about your audience and the major players.
Market research can assist you in understanding the competitive landscape, while competitor research can help you identify growth opportunities.
It is possible to take advantage of the gaps left by your competitors once you identify their strengths and weaknesses. You can prepare accordingly by identifying the areas where your competitors’ strengths already exist.
The following is a practical approach for conducting effective market and competitor research for online businesses:
Identify Your Competitors
The first step is to identify who your competitors are. Even though it may seem obvious, it’s crucial to analyse them thoroughly.
You may start by searching for keywords related to your business or your target market on Google.
It will bring up a list of websites that sell plus-size clothing. If you’re selling women’s clothing for curvy women, you might search for “women’s plus-size clothing.”
On social media platforms, you might perform competitive analysis as well.
Explore Their Product Offerings
Visit their websites and analyze their products, prices, and presentation after you’ve compiled a list of potential competitors. Along with that, there are the 3 P’s of competitor research.
Those P’s give you a comprehensive understanding of the following:
Visit their websites and analyse their products, prices, and presentation after you’ve compiled a list of potential competitors. Along with that, there are the 3 P’s of competitor research. Those P’s give you a comprehensive understanding of the following:
- What type of products do they sell?
- Do they cater exclusively to a niche market or offer a wide range of products?
- What is their unique selling point?
- Do they have top sellers?
- How much market share do they have?
Answering these questions can help determine your target market’s needs, wants, and spending habits. You can reach your goals by choosing relevant products and working on your niche.
Research the Pricing Strategies of Your Competitors
Because price heavily influences customers, your pricing strategy can make or break your online business. It is essential to perform a thorough competitor analysis, including asking crucial questions about their prices.
How do they attract customers for one-time purchases with premium pricing? Do they offer low prices for their products and leverage high volume sales as a value pricing strategy?
Analyze their product line, read customer reviews, and determine if similar pricing strategies align with yours. Determine this by answering the following questions:
- How satisfied are their customers?
- Are they willing to recommend their products?
- How do they handle returns and refunds?
To attract customers for your online business, you must find this information and use it to create an intelligent pricing strategy.
Find out if your competitors offer any discounts or perks in addition to their prices. For instance, free shipping, giveaways, and membership rewards are a few ways some businesses keep their customers happy.
These approaches can help your business grow. Remember to consider your internal costs whenever you spend money on promotions or discounts. Being profitable is always the primary goal.
Study Their Marketing Strategies and Online Presence
The fourth step is to examine your competitors’ online presence and marketing strategy to gain insight into how to attract and retain customers. Start by reviewing the websites of your competitors.
Can they be easily navigated? Can they provide valuable content? Do they blog or create other types of content, such as infographics or videos?
Then consider their social media presence. Is their social media presence widespread? Do they post regularly? Are they sharing any particular content?
Look at the email marketing of your competitors. Do they send any newsletters?
Your marketing strategy will be more effective if you collect data like these from different platforms.
In addition, make the most of your marketing stack by learning to use tools and saving time.
Find out about their tools and software
Successful businesses rely on technology stacks (online tools and software). To understand how your competitors manage their business, you must learn about their technology stack.
The system is efficient, for instance, if two or more competitors use a specific type of software. Therefore, adopting this tried-and-tested system is better than trying a new one.
Yet, how do you determine whether it works? So, one of the best ways to determine the technology your competitor’s websites are built with is by using an online tool.
Alternatively, you can look at the LinkedIn profiles of your competitors. You might want to look at the LinkedIn profiles of developers and engineers.
They tend to share their expertise and experience on that site. Alternatively, you can examine the job listings of your competitors to see what type of developer they hire.
Identify areas for improvement
The next step is to sit down with your team and see where you can improve based on your information.
Where do your competitors excel? Where can you outperform them? Think honestly about this.
You need to step up your game if your competitors are outperforming you. Perhaps you need to change your pricing, redesign your website, fine-tune your content strategy, or improve your customer service.
Here are five reasons why entrepreneurs research competitors for online business
Is your decision to invest time and resources in competitor research still on the verge of second thoughts? Consider these five reasons to get started immediately:
- It will help you understand the competition.
- Understanding your competitors’ strategies can help you develop your unique selling points.
- You can assess your progress and performance against them by benchmarking.
- You can identify market gaps that you can exploit through competitor research.
- Keeping up with industry trends and being aware of new market entrants will be very helpful.
Finally, remember that competitor research is integral to any business’s marketing strategy. By understanding your competitors, you can ensure that you’re always one step ahead of others.