Topic 3 : Competitor Analysis

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  1. Better Than But Not Active – These are competitors who’s products or services may be better than yours however they are not very good at marketing this fact and they are not very active with pricing , they simply continue to place their products on the market without considering the competition
  2. Better Than and Active – These are competitors who’s product or service maybe better than yours and they are also good at marketing this fact, they keep a close eye on the market and are quick to react to competition. Typically they will have a strong sales and marketing team.
  3. Worse Than and Not Active – These are competitors who’s products or services are worse than yours and they are not very active on the market, typically they are older firms who have become lazy, they have poor products or products that are out of date/ have been superseded and they have weak or not marketing or sales teams and no direction.
  4. Worse Than but Active – These are competitors who’s product or service maybe worse than yours but they may have a great sales and/or marketing team who are very aggressive or they are willing to take silly risks perhaps without considering the consequences.

The competitor analysis grid provides a simple visualisation method of identifying and analysing our competitors within our given market at any moment in time.

It categorises competitors into 4 distinct categories represented as 4 squares within the grid.

Essentially it looks at the 2 key factors

The product or service they offer – Is it better or worse than the product or service you offer

The Sales / Marketing activities they are willing to engage in to compete with you i.e. are they highly reactive or are they fairly dormant and inward looking.

By analysing these 2 features we can quickly analyse our competitors into 4 categories.

  • Activity: Plot your competitors

Now that you understand the principles of the competitor analysis , spend some time researching your competitors to work out where they fit best within the 4 boxes.

What does this tell you about the market you are going into, is it likely to be fiercely competitive , or are your competitors poor and slow to respond.

The result of this analysis will help you decide what the likely response will be to any market activity you undergo i.e. what reaction there will be as you start to increase your sales and share of the market.

Additional Reading

If you want to know more about how to analyse your competitors in more depth you can watch the following links;