12 Tried & True Strategies for Scoping Out Your Competition

This post Sponsored by Olshan Law.

If you have a company that aims high and strives to rise to the top of your respective field, then it’s only natural that you should want to scope out the competition. Knowing where you rank among your competitors gives you valuable insight into what’s working for them, and it allows you to implement some of the tactics that have made them successful into your own business. It also gives you important feedback that tells where your business stands in comparison, and this data can serve as motivation for making your business even better.

So how can you gauge your competition and see just where you stand? Here are 12 tried and true strategies to start using today:

1. Determine What Metrics are Important

It’s crucial to understand what metrics are important before you start examining the data. You could compare revenues, unique visitors, total visits, traffic rank, etc. Just choose a set of metrics that are significant to you and use those metrics to measure the data.

2. Examine Recent Trends

Recent trends matter because they keep you in the know of what’s happening now. This is especially true if your company is a brand new start up because you won’t have older data for comparison.

3. Investigate Historical Trends

Why would you need to be aware of trends that occurred a long time ago? Historical trends help you understand two things. First, they tell you the speed of growth. Secondly, they tell you if the same event has an equal impact on both companies. For down spurts, you should look into the causes of the dips. Was it external events unique to the company you’re evaluating that caused the dips, or was it something that impacted everyone? Also, check into the frequency of the events causing the down spurts. Was it a one time event like a hurricane or other weather related disturbance, or was it an event that occurs annually, like the 4th of July holiday?

4. Seek out Confirming and Disconfirming Data

To accurately know how your company measures up against a competitor’s, you have to evaluate different types of data. Your revenue model can serve as a frame of reference that shows what should be compared. Whether you should be more concerned with visits, unique visitors, or the number of subscribers will depend upon the revenue model you use. That being said, it’s important to keep all the different metrics in mind because more than one metric could be useful in your comparison, and different metrics can tell different stories about relative size and growth.

5. Track Your Competition With Google Alerts

By setting up a Google Alert, you can get the latest on what your competition is doing, and you’ll also be notified when they’re in the news. Google Alerts even lets you determine how often you want to be notified: once you set it up, you can receive a notice instantly, or you can choose to receive notifications on a daily or weekly basis.

6. Look at Monthly AND Annual Growth

Rapid monthly growth certainly accounts for something, but it can be misleading if the annual growth rates tell a different story.

7. Shop from Your Competition

If your competitor is an actual store, go visit to see how products are merchandized, how store employees treat customers, and buy something to see how sales transactions are handled.
If your competition is online, visit their website to see how they describe their products. Order an item and notice how they handle payment, how your purchase is packaged, and how fast it’s shipped.

8. Find Out What’s Working for Your Competition

When people tell you that they like a competing business, ask them what that business does that makes them so appealing. Most of the time, people will be happy to share this with you, and you can put the information you collect into a database to serve as a blueprint for strengthening weaknesses in your own company.

9. Conduct an Online Survey

Beyond talking to people in person, conducting an online survey is a great way to gather information about your competitors. Ask what brand of product they purchased in the past six months, and what made them choose that brand over the other ones. For instance, you would want to know: was it a coupon, was it part of a bundle, or was it part of a promotion? If a significant number of people say they used a coupon, that tells you that your competitor has an effective coupon strategy. You should also find out how the product was made available: was it through a specific retail store, an online store, or just chance? If 75% of your respondents say they purchased the product online, you’ve just learned valuable information about your competitor’s strongest channel.

10. Don’t Settle

Don’t become content with just the basic information. Gather and examine all the information you can find to confirm or disprove your conclusions. Consider using a tool like Quantcast to get detailed analytics reports and receive valuable information about your competitors.

11. Cross-reference Sources of Information

Cross-referencing your sources provides reassurance and gives you confidence in your findings, especially if those sources reveal similar trends. Two great places to start are Alexa and Dataopedia.

12. Repeat the Process

The more often you perform competitive analysis, the better you’ll become at it. It’s a practice that requires patience and persistence, but the data it yields makes it undeniably worth it.

If you want to evaluate your competition and see how your business stacks up, the strategies listed above will tell you what you want to know. With any luck, once you start using them, you’ll not only be scoping out the competition, you’ll be smoking it out too.