“Know your enemy and know yourself; in a hundred battles, you will never be defeated.” Sun Tzu, an ancient Chinese military strategist, wrote this in his treatise, The Art of War, over 2000 years ago. But what does that have to do with selling products in your eCommerce store? Chances are, you’re not actually going to war against your competitors (but if you are, we definitely want to know about it). However, every day you are metaphorically going to battle with your competitors, vying for the top spot on the search results, pay-per-click ads, and ultimately, your customers’ dollars.
Competitor analysis is a critical part of your marketing strategy, whether you’ve just launched your eCommerce site or you’ve been running it for 20 years. Here, we show you how to get started.
You can’t accurately identify your competitors if you don’t have a solid understanding of who your company is or what niche your products fit into. What is the range of products that you offer? What is the price point? Who is your target audience? You will need to know this information in order to properly compare yourself to your competitors.
Before you begin, you’ll also want to define your goals. If you know from the outset that your user experience on your site is lacking, then you will want to focus more of your competitor analysis there. If you want to ramp up your content marketing strategy, then you would spend more time reading through their blogs and social media.
Do your best to be objective throughout this process. Examining both your own eCommerce site and your competitors’ with an unbiased perspective will give you better insight and actionable data.
Keep Your “Enemies” Closer
The next step is, of course, to determine who your competitors are. For the purpose of this exercise, let’s pretend that you sell socks that have designs that are reminiscent of popular video games. Your primary audience is people aged 18-34 who enjoy games and the other trappings that come along with “nerd” culture.
Primary competitors: These are companies that offer products that are very similar to yours to the same target audience. Since you sell unofficial products, you would be competing with game companies who sell licensed apparel for their games, as well as other shops that have gaming-inspired clothing.
Secondary competitors: These are companies that sell a similar product, but perhaps to a different audience. So a company that sells eco-friendly, sensible socks could be a secondary competitor. More well-known designers that happen to sell socks could also be considered a secondary competitor.
Tertiary competitors: These are companies that sell products that are somewhat related to yours and also target the same audience. In this instance, it could be a company that sells collectible figurines from video games.
Divide and Conquer
Now that you’ve gathered this information, you’ll want to organize it in a way that’s useful. I’m a big fan of spreadsheets myself — you can list out different categories and have each company you consider a competitor in a different row. Here are some aspects that you’ll want to examine on your competitors’ websites:
What is the range of products for sale? Do they focus on just one type of product, or have they expanded to offer multiple related products? What descriptions or images are shown for each product?
Visit their blog page. What type of content are they posting, and how often? Do they have any videos or other supplementary content that offers tips, how-tos, or other guides that are related to the products they sell?
Website User Experience
Pretend that you are trying to make a purchase on your competitor’s website. Is it easy to find the product you want via category pages, filters, or a search function? How about adding something to your cart? Checking out?
Look carefully at the imagery and the type of language they use on both their website and social media. Are they cool and sophisticated? Cute and quirky? What are the benefits or unique features of the product that make it attractive to the audience? How they’re using their brand to position themselves is an important piece of the puzzle.
At the end of the day, pricing is one of the key factors in the world of eCommerce. Are their products similarly priced? Do they offer bundle deals? Seasonal sales? Free shipping with a minimum purchase price?
Fighting a Losing Battle? Call in Reinforcements
Sometimes, our own biases prevent us from performing an effective competitor analysis. But being able to pinpoint where your website is lacking or finding opportunities for a new audience segment can help you sustain and grow your business. Fortunately, the cavalry has arrived — our team has the tools and insight to find your company’s weaknesses and implement SEO, PPC, and social media strategies to come out stronger than ever before.
To learn more about how to take your eCommerce marketing strategy to the next level, reach out to us today!