A Complete Guide to Conducting Comparative Market Analysis
Understanding the competitive landscape is critical for business success. Comparative market analysis lets you assess your positioning and craft data-driven strategies.
This comprehensive guide covers everything brands need to conduct effective market analysis.
Savvy business owners know that doing comparative market analysis online is crucial before doing anything. After all, before you launch a product or try out a new strategy, you want to know what your competitors are up to.
That way, it’s much easier to learn from their mistakes and successes.
Before explaining how to conduct a comparative market analysis online, you should know that analyzing the market is vital before commencing any business. In simple terms, let’s say you want to buy a laptop.
Do you just haphazardly walk into the store and pick out the laptop that appeals the most to you?
No, not.
You go online and search for the best specifications, the best manufacturer, and the best prices; more importantly, you want the best bang for your buck. In pure and simple terms and on a much smaller scale, that is what a comparative market analysis online is.
This same principle applies to any business decision.
Table of Contents
What Is Market Analysis?
As part of any business plan, conducting a market analysis before taking action is crucial. In olden times, you might have just opened a business without researching. This may have worked 50 years ago.
However, with today’s vicious market, SMEs are popping up everywhere, and competition is fierce. Without analyzing what exactly you’re getting into, it means you’re going blind.
So, what is a market analysis exactly? More technically, it is a quantitative and qualitative review of the target market.
The research is primarily concerned with:
- The size of the market,
- The consumer,
- The competition,
- And the economic status of the market.
In other words:
- Who is going to buy your product?
- How do they want to pay for it?
- Who else is selling a similar product?
What is Comparative Market Analysis?
The comparative analysis evaluates your company against competitors on key attributes like pricing, products, marketing, etc.
It provides objective insights into your strengths, weaknesses, opportunities, and threats. With this intelligence, you can improve performance.
Steps for Effective Analysis
Follow this process:
1. Identify competitors. Look beyond direct competitors to alternatives customers may consider.
2. Determine comparison criteria. Pricing, market share, social media reach, product features, etc.
3. Gather data. Use tools like SEMrush, Social Insider, and Alexa to compile insights.
4. Compare offerings. How do you stack up on key criteria? Where do you fall short?
5. Set benchmarks. Establish specific KPIs based on top performers to guide strategy.
6. Identify opportunities. Find weaknesses you can capitalize on. Improve where you trail competitors.
7. Optimize marketing. Address gaps with improved positioning, messaging, content, and value propositions.
Maintaining a Competitive Edge
Comparative analysis is not a one-time exercise. Continuously monitoring the market and refining efforts based on the latest data.
Ongoing analysis allows you to spot new competitors and respond before they erode your positioning.
Use this guide as your playbook for understanding the market landscape and benchmarking performance—partner with our team to conduct a comprehensive competitive analysis tailored to your business goals.
Why Is Market Analysis Important?
What does a market analysis tell you about a market? By researching the market and reviewing the results, you get a general idea of the market’s direction. By the end, you should know the ins and outs of the market you’re investing in.
Below are some key elements of conducting a successful market analysis online.
Target Audiences
Segmenting the market into groups, whether by age, gender or social standing, is the first step to getting to know your customers. The first thing a market analysis tells you is who your customer is.
This valuable piece of info tells you who to market your products to. By studying up on your consumer, you can satisfy their needs more easily. Knowing your targeted demographic is vital, and here’s why.
By zeroing in on the desired demographic to target, the product can be tailored to their experience, thus gaining more customer satisfaction. Specifically, you should at least have a clear picture of your audience:
- Age,
- Gender,
- Location,
- Income,
- Education,
- Profession,
- Interests,
- Preferred online channels.
Competitors
The second most important part of market analysis online is knowing who your competitors are. Identifying the strengths and weaknesses of both your competition and your own business is valuable information.
What’s more important is identifying your business’s competitive edge.
This means finding out your opponent’s weaknesses and your strengths. That way, you can draw up a strategy to have the ability to be competitive in the market. This is crucial when entering a new market terrain.
Market Gap
A market gap is a consumer need not fulfilled by the established businesses in the market.
Finding a gap in a market is akin to finding a pot of gold. A good market assessment will locate the market gap and enable the investor to fulfil it. Satisfying a missing consumer need is one of the best methods to stay competitive.
Alternatively, sometimes it’s possible to create your gap in the market with a truly innovative new product. The best example of this is the iPad. Before this launched, you probably didn’t even know you wanted a tablet.
Strategic Analysis
Carrying out competitive analysis online also helps determine which marketing strategies offer the best return on investment in your industry. This is especially useful if you don’t have a large marketing budget.
This means you don’t have to waste money experimenting with new marketing ideas.
You can check out what social media posts get the most engagement in your industry or what kind of content marketing offers the most return on your investment. This helps to guide your investment.
A Guide to Conducting Comparative Market Analysis Online
Now that the idea of market analysis is clear, we can better understand the nature of comparative market analysis online.
What is comparative market analysis? Simply put, it evaluates prices of similar products before engaging in any purchase or selling transactions. Comparative market analysis can be done in any industry online.
To fully understand how comparative market analysis online works, here is an example that could better help understand the assessment parameters.
A prospective buyer wishes to bid or send an offer on a small one-bedroom apartment. The intended apartment is on the 6th floor of a 1600-square-foot apartment complex. The owner is asking for £120,000.
Through a comparative market analysis online, the buyer finds the comparables. These similar apartments that were recently sold are from nearby apartment complexes. That way, they can compare the prices.
There are several dedicated tools you can use for more specific kinds of competitive market analysis online. For example, tools like Semrush can be used to analyse the digital marketing and SEO strategies of your competitors.
Never Go in Blind
Accurate research and assessment are key when taking any steps in the business world. In today’s world, entering a market without knowing its parameters will produce an unsuccessful business.
Whether opening a business or buying a house, thorough research guarantees a smooth and successful transaction. In business, market analysis is one of the most important parts of any startup strategy.
When done correctly, along with a detailed business plan, the investor will be clear on the path their business is headed. As for comparative market analysis online, when conducted thoroughly, it guarantees the buyer a fair deal and gives the seller an estimate to help ease the transaction.
Comparative Market Analysis Online Frequently Asked Questions.
Q: How often should I conduct comparative analysis?
A: Analyze key competitors at least quarterly. Monitor for new market entrants regularly as well. The market evolves quickly.
Q: What tools do you recommend for market analysis?
A: SEMrush, Social Insider, Alexa, BuzzSumo, SimilarWeb, Google Trends, and SpyFu provide robust competitive insights.
Q: What if we don’t have the resources for in-depth analysis?
A: Prioritize 5-10 key competitors. Streamline by focusing comparisons on the most critical data points and metrics.
Q: How can I find potential new competitors?
A: Look for companies filing similar trademarks and patents. Monitor affiliate sites and “best of” lists related to your offerings.
Comparative Market Analysis Online Conclusion
Comparative market analysis reveals objective insights into your positioning versus competitors. It identifies areas to refine pricing, features, messaging, and more.
But analysis is just the first step. Use the intelligence to make strategic improvements and maintain your competitive advantage.
Regularly assess the landscape and respond quickly to market changes. Partnering with an expert analytics team provides the resources and perspective to benchmark performance.
