Doing a competitive analysis or SWOT analysis helps you identify the following about your business and your top competitors: Strengths, Weaknesses, Opportunities, and Threats. Taking the time to perform this analysis puts you in a position to develop/expand/tweak your business plan. Successful brands change with the times. Businesses that stay stagnant miss out on opportunities in the market. Case in point, remember Blockbuster? They dominated the market in video rentals so shouldn’t they have been the ones to bring us Netflix style subscriptions? Or how about Kodak? I grew up with much love for Kodak, why did they disappear. MISSED OPPORTUNITIES and THREATS from competitors. Figuring out your UVP (Unique Value Proposition), or what sets you apart from the competition, puts you in a good position to set marketing goals and make intelligent decisions on how to get where you want to be.
- It helps you determine what will set you apart from your competition.
Is there a market for your service? How can you do it better to stand out?
- You can see potential threats and make changes before it negatively affects your business.
Is the need for your product dying out? How can you change with the times and stay relevant?
- You see potential opportunities for expanding your business.
Think McDonald’s all day breakfast. Only time will tell if the decision will pay off but they identified an opportunity and seized it.
- Knowing your own weaknesses helps you improve your product or service. Knowing your competitors weaknesses can help you take your business to the next level.
Set yourself apart by improving on what your competitor is doing wrong.
- Do you need to Keep up with the Joneses?
Keeping an eye on your competitors helps you stay focused. You will have some companies that you follow to keep up with the latest trends and some keep you in check on your own service level.