Staying ahead of the competition is undoubtedly one of your top priorities. If you can’t stand out, how will you ever boost sales and grow?
In e-commerce, it seems like a new business opens its virtual doors every day. The market is very saturated, so gaining the upper hand can be quite challenging.
Fortunately, you can improve your efforts by learning from your competitors. Conducting a competitive analysis can open up new horizons and help you take a massive slice of the market’s pie.
Here’s how to do it and what you can learn at each step.
Pinpoint Who Your Competitors Are
Before you get into the research, make sure you have a clear goal in mind.
What is it that you’re looking to improve? Is it sales from social channels? Or perhaps brand awareness?
Whatever it is, it’s imperative to understand it beforehand, so that you can have a solid foundation to build on. Just make sure you set SMART goals to have a clear sense of direction.
Once you’re all set, it’s time to identify your competitors.
The simplest way to start is to type your own keywords into Google. That way, you’ll instantly see who the most successful players in your e-commerce niche are.
You can also explore e-commerce marketplaces, such as Amazon. You’ll find a bunch of sellers who offer the same or similar products as you do.
There are lots of competitive analysis tools that can help you discover your rivals, such as Keyword Spy. For any keyword you enter in the search box, it shows you the top ten PPC and organic competitors. That’s more than enough to learn from and fuel your growth.
Classify Your Competition
Not all the competitors you find will be of primary interest to you, which is why it’s essential to categorize them.
You can classify your rivals into three main categories:
- Primary competition
- Secondary competition
- Tertiary competition
Primary competitors are those that offer similar or the same products as yours or sell to the same audience – or both.
Secondary competitors offer similar products, but either quite cheaper or more expensive. Hence, they have a different audience.
Tertiary competitors have products related to yours, so your audiences may slightly overlap. They can be excellent partners if you’re looking to expand your product line sometime in the future.
Once you categorize all of them, you can quickly determine which to include in your competitive analysis. Naturally, you’ll want to analyze the prominent competitors who are generating higher sales and revenues.
Conduct Competitive Website Audits
Exploring your competitors’ websites plays the most significant part of this entire analysis. Their website is essentially their virtual store, and you can learn a lot from it.
You should look into their:
- Site design, including mobile responsiveness
- Product photography and product descriptions
- Blog content
- Customer support (phone, live chat, email, social media)
- Social media integration
- Email marketing strategies
- Promotion tactics (sales, discounts, coupons, etc.)
There’s so much more you can research to see exactly how your rivals are targeting and converting your target customers.
You’ll know how they’re different from the rest, what messaging they use, how they highlight their benefits, and much more.
You should take it a step further and sign up for their email newsletter. You’ll see how they interact with leads, and how often they stay in touch.
You should also try and make a purchase but abandon the shopping cart. That’ll help you learn about the company’s cart abandonment strategy.
When you gain insight into all their strengths and weaknesses, you’ll know precisely where opportunities lie.
Explore Social Media
Social media can also significantly help you collect competitive intelligence.
See what channels your rivals are using and how broad their reach is. Reach doesn’t necessarily indicate engagement, but it can show you how many of your target customers are using social media.
You can then learn how they are communicating with and engaging their followers. Examine how responsive to messages and comments they are and how they deal with negative feedback. See how often they post and what kind of content they share.
Whatever you can find on their social profiles, use it to find a way to step up your game.
Perform a Detailed Customer Analysis
Conducting a competitive analysis comes down to learning how to attract and retain more customers. So, it’s only natural to research competitors’ customers too.
Social media are an excellent start for your customer analysis. You can find out what people are saying about other businesses in your niche.
Thanks to hashtags, you can quickly discover mentions of your competitors’ businesses to see what people like and don’t like. There are also tools for social mentions you can utilize.
Reviews on e-commerce marketplaces are also invaluable. They can show you which products are in high demand and what their best features are. They can showcase consumers’ preferences and opinions on if and how they could be better.
They can help you uncover potential areas for improvement so that you can offer the products people are looking for.
If your competitors feature testimonials on their websites, there’s another chance to gain insight into their products and customer service.
Examine Their Pricing
Looking into your competitors’ pricing is the smartest step for creating your own pricing strategy.
If one of them seems a bit expensive, find out why that is. Do their products have a unique feature? Is their shipping incredibly fast? How is their product return strategy?
Remember that you don’t have to offer cheaper products to stand out. Most people are actually willing to pay more for high-quality products, expedited shipping, and exceptional customer service.
But just as you don’t want to make your products too cheap, you also don’t want to overprice them. Analyzing the pricing of your biggest rivals will help you strike the right balance.
Find Out How They Handle Shipping
Shipping costs are often the main reason for shopping cart abandonment. But free shipping isn’t always the most feasible option, especially when you’re just starting out.
So, find out how the most prominent players in your niche are handling it. Do they offer same-day shipping? Do they offer loyalty cards?
The best way to learn everything about their shipping is to simply purchase one of their products. You’ll see firsthand how fast they deliver, what packaging and follow-up strategies they use and check out the product itself.
You’ll have a full shopping experience that will definitely provide you with invaluable insights.
Competition doesn’t need to make your life harder. As you can see, it can actually help you improve, as long as you know where to look.
Without it, it would be a lot tougher to find out what your target customers are looking for. It would be especially daunting if you’ve just launched your business.
You would need to experiment with everything on your own and potentially learn from your mistakes. This way, you can know exactly what to do and what to avoid.