Any comprehensive competitive analysis involves understanding and analyzing competitor businesses, strategies, clients, market share and marketing, niche area, competitor strengths and weaknesses, opportunities and threats etc.
Success in any online business or Ebusiness or Ecommerce is the objective of many businesses. However, it is not that easy. More than 92% of online businesses fail. One of the main reasons for this is that they are ignorant of competitive environment.
Why some online businesses are successful and others are not? Why some customers have preference for one business than the other? In order to understand these questions it is important that a proper competitor intelligence is done.
With wide spread internet, world has become a huge market place. No business on the net is now restricted to any particular geographical area. Internet has provided a leveling field equally to the big and small businesses. Establishing a business online has become so cheap and easy that there are hundreds of thousands of suppliers in any particular line of business.
Competitive intelligence is necessary in order to be successful in a competitive market and to stand out of the crowd. Any competitive analysis should throw light on the following:
Nature of Competition
Any online business must have the information about the number of competitors, their volume of business, product mix etc. It also needs to be seen how they produce and market their goods and services.
This involves target market, pricing and marketing strategy, overall product information and presentation. Some competitors have more offline business than online business. Their online business only marginally supplements their offline business by publicity and sales. It might be also useful to study this and to understand its implications for overall competitive advantage.
This stands for Strengths, Weaknesses, Opportunities and Threats. A SWOT analysis will bring out the strengths and weaknesses of any business and outside opportunities and threats objectively.
Competitive research under this will involve a study of competitor websites, their layout, design, theme, links, content and the ease of navigation.
The test of any ultimate business success is to demonstrate in what respects a product or service is different and better than the one provided by competitive competition.
Only after understanding competitors and their businesses, you will be able to formulate your own competitive strategy. This necessitates that a thorough competitive analysis is conducted not only at the start of a business but even at other times during ongoing business.
Any competitive analysis requires detailed competitive intelligence. All established and aspiring online businesses need to do a competitive analysis. Fortunately there are many professionals doing this job to establish your competitive edge.
The author has also long research experience and can do any type of competitive analysis in consultation with the clients. It can be quite to get an independent opinion regarding the competitive market for certainty and final success.
The author has background in business, economics and finance. He is presently researching in finding ways to make money and working on the following website and blogs:
This first video, out of two, demonstrates how to analyze and understand the competition. There are two ways to do so. The qualitative approach describes the direct, indirect and potential competition while the quantitative approach demonstrates the level of competitiveness of your existing business versus the direct competitors. The next video; Competitive Analysis (2), completes the quantitative approach.
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