The Importance Of Competitor Analysis In Digital
In many respects, the internet is like an open book. Most information is just a click or two away, and a wide array of research and analysis tools are at your fingertips at any time. Twenty years ago, to find out what a competitor was doing with their prices, their products, or their marketing, you may have had to drive across your city, fly across your country, or find someone with the inside scoop. But today, competitor analysis can be done simply and swiftly, with a precision that has never been possible before.
What is competitor analysis?
The concept of competitor analysis should come as common sense to most people. While many businesses aim to innovate and elevate above their rivals, for the vast majority, comparison and competition are realities of the market. When it’s all said and done, customers will compare your business to your competitors. This means that having a good idea of what your competitors are doing, what’s working for them, what isn’t working, and where gains or separation can be made, are all crucial steps for almost any business - and this is particularly so in the online and digital spaces.
Why is competitor analysis particularly key in digital?
There are two key reasons as to why competitor analysis is particularly key in the digital and online spaces. Firstly, the internet creates such low switching costs for consumers. Often, they are presented with so many choices in every industry, and can very easily switch between alternatives. This is seen in almost every industry. In fact, from the Frankly Insights platform, we know that around 60% of US shoppers will use their smartphones in certain stores to check reviews and competitor prices. This fluidity and constant battle makes it imperative for businesses to understand what aspect of a competitor’s product or digital marketing might push customers towards that competitor. It could be a new product feature, a certain marketing campaign, or a pricing strategy. Whatever it is, being across it and figuring out how to match it, beat it, or mitigate its impact on your own marketing is more important than ever.
Secondly, competitor analysis is particularly key in digital due to the overflow of data available. If you’re not using the information that’s out there to your advantage, then you’re behind the eight ball. You can use anything from tracking competitors’ social media engagement to monitoring their busiest hours through Google’s publicly available customer GPS data. You can pull their customer product reviews and website copy to figure out what keywords and terms are used to describe them. The potential to benefit your business is so broad that competitor analysis is a step you really cannot forget when trying to leverage digital and take your business to the next level.
Some tools that we favour for competitor analysis
Now beyond the creative methods that you can employ with publicly available data, there are a number of tools and online features that we at Frankly are particularly fond of when it comes to competitor analysis. Some are free and easy, others require subscription or use of a service already, but all of them are effective at giving you instant, actionable insight on competitors.
Firstly, and probably the most simple one, is Facebook’s Ads Library. This is a feature where you can access almost any company’s set of Facebook Ads, both past and present, to get an insight into what they use in their paid digital marketing, both in terms of visual creative and also their ad copy.
Similarly, Semrush is a paid subscription service that offers an expansive range of tools to help with almost anything digital marketing, but one of their tools can scrape and pull another company’s Google Ads. This informs you what the competitor has done with creative and ad copy, as well as giving you data on the specific keywords and search terms that the competitor targeted in their marketing. Furthermore, Semrush’s tool gives you insight into the demographics and interests of the recipients of the competitor’s ads.
Another key tool is the Auction Insights feature of Google Ads. If you manage a Google Ads account, you can access a list of the rival bidders for certain ad campaigns, and get a good understanding of the other companies that are competing with you for the top of key Google searches. Auction Insights can be sorted by date range to track the changes in competition over time, with some competitors likely to get more aggressive or tail off away from you over time.
