Let us discover another tool of competitor analysis, which is the “competitor matrix” or “competitive research” . To know who are your competitors and what their strengths and weaknesses, it is important to collect some key information available in the public domain about them (from company website, financial reports, newspapers, online database, search engines), the most relevant for your business and firm.
Step 1 : what is your industry ?
Firstly, you must identify the industry of the firm. Automobile, retail or real-state …. ?
Step 2 : what are your competitors in this industry ?
Secondly, list your potential competitors in this same industry : competitor 1, 2, 3 … in each row of your matrix , don’t forget your firm at the first row !
In this step, you can capture your current competitors and may be your future competitors. You may identify some strategic groups which share the same strategy characteristics, goals or market niche…. The strategic groups identification will help you to prioritize which competitors to analyze since there are in the same strategic group that you target.
Step 3 : Which information to capture about the competitors ?
In the third step: determine the relevant metrics to analyze that allow you to determine each competitor position and strengths among the others.
Take some few questions to help you identify these metrics similar to :
- What are the performance metrics that define the industry ? May be related to revenue and profitability. For example, dividend policy, profitability, financial ratio, cash flow, capital investment
- What are their key capabilities ? the product offered, services, innovation, brands, patents, marketing, company size, skill assets….
- What are their objectives and goals ?
- What is the mission and what are the values of these competitors ?
- What is the strategy of these competitors ? How they positions their self in the industry and with which business model? What is the Strategy of growth ?
In case of digital marketing, different type of content can be analysed : blog posts, whitepapers, eBooks, videos and images, newsletter, forums,…
Based on this matrix you can associate weight to each metrics and
a score to each competitor, thereafter, order them based on this scoring.