How to run a competitor analysis [step by step]

Working at Nickelodeon has given me a deep understanding of the kids’ entertainment landscape. What’s interesting is that, just a couple of decades ago, the brand’s main (read: only) competitors were other kids’ cable television channels, such as Disney Channel and Cartoon Network.

Now, the landscape has shifted significantly. While children’s channels are still competitors, we also have a whole new slew of contenders in the mix, like YouTube Kids and Netflix.

Kids consume entertainment on various platforms and devices nowadays, compared to how I did as a child, which means Nickelodeon’s competitive analysis has had to adapt to account for these major industry changes.

In this post, I will walk through my competitor analysis guide to showcase the benefits of revisiting your own company’s competitor analysis, as well as tips to perfect the process.

Table of Contents

• What is a competitor analysis?
• Benefits of Competitor Analysis
• How to Conduct a Competitive Analysis
• Competitive Analysis Templates
• Competitive Analysis Example: Kids’ Edutainment App

What is a competitor analysis?

At its most basic level, a competitor analysis identifies your peers in the industry and then takes a deeper look at what they are doing. You can see how you’re doing in comparison and gain insights about what you can be doing better. It’s a smart strategy for identifying trends and pinpointing opportunities to become more competitive in your niche.

Benefits of Competitor Analysis

Competitor analysis presents a significant opportunity for businesses to gain a deeper understanding of their positioning in the overall industry and enhance their high-level decision-making by comparing their performance to similar brands.

The results may not be what you hoped for, and that’s okay! The important thing is to know the areas in which you may be lacking, to then take the necessary steps to improve.

1. Evaluate performance standards.

Conducting a competitor analysis can help businesses set a benchmark against standard performance within the industry. If other companies are improving in areas that your business is not, it provides an obvious domain to cultivate.

For instance, if other kids’ entertainment brands receive more likes, comments, and shares on social platforms compared to us, we can improve our social strategy to publish content that encourages more audience engagement.

2. Reveal untapped opportunities.

Conversely, a competitor analysis may indicate market gaps, offering you areas where you can fill the gap and differentiate your business from the pack.

Lots of kids’ shows and movies are now available across most streaming services, but that wasn’t always the case. PBS KIDS is considered the first major network to introduce a dedicated app for kids' content in 2011, which fulfilled parents’ demand for safe, accessible entertainment for their children.

10 Free Competitive Analysis Templates

Track and analyze your competitors with these ten free planning templates.

• SWOT Analysis
• Battle Cards
• Feature Comparison
• Strategic Overview

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3. Uncover new marketing strategies.

Sometimes a brand hits the jackpot by developing a marketing or sales strategy that is highly efficient and effective. Administering a competitive analysis can teach businesses which tactics have been successful for similar brands in the past and help them incorporate those tactics into future campaigns.

When tapping agencies or partners to collaborate on a new campaign, we often have the chance to review case studies on their past partnerships. These case studies are part of competitive analysis as they offer key insights into what strategies have been attempted in the past, and how they performed.

4. Optimize pricing.

It can be difficult for businesses to balance remaining competitive and making a profit. I live in New York City, so I’ve seen the endless battle between dollar pizza places trying to stay afloat — some offer pizza for 99 or 98 cents, while others offer a $1.50 deal on a slice and soda.

Competitive analysis can help businesses understand how competitors are pricing their products and services, and offer important context to either lower or increase prices accordingly.

At Paramount+, we offer a $7.99/mo Essential plan with ads and a $12.99/mo Premium ad-free plan with Showtime content and live TV. Streaming services typically offer multiple pricing plans, including free or discounted ad-supported versions and bundles, which provide opportunities to encourage sign-ups at varied price points, retain subscribers, and make a steady profit.

How to Conduct a Competitive Analysis

Now that we understand some of the benefits of competitive analysis, let’s move on to the actual process for conducting one.

1. Define goals.

Before beginning a competitive analysis, businesses should understand what they wish to gain from this process. Some examples of goals are understanding competitive pricing, enhancing the customer experience, identifying potential risks, or developing new sales tactics.

2. Identify competitors.

Next, businesses should create a list of competitors they wish to analyze:

• Direct competitors. Businesses that offer similar products/services and/or are within the same market (e.g., for Nickelodeon, this may be other traditional kids’ networks).
• Indirect competitors. Businesses that offer different products but satisfy similar needs in consumers (e.g., for Nickelodeon, this could be gaming platforms since they’re a different form of entertainment than television, but similarly entertain kids nowadays).
• Aspirational competitors. Impressive businesses that set industry trends (e.g., Nickelodeon may be an aspirational competitor for newer kids’ entertainment brands and start-ups hoping to achieve household name status).

3. Collect relevant data.

The next step is to gather competitive intelligence on competitors’ products or services, pricing, marketing and sales strategies, market positioning, customer experience and reviews, and overall digital presence.

To accomplish this, businesses can reference publicly available sources, such as press releases, media coverage, financial reports, and case studies. Other sources include social media platforms, social analytics tools, SEO tools, consumer surveys, and firsthand observations.

Businesses can reference the SBA website for additional sources of free data and trends for small businesses. You should always ensure all means of gathering information are legal and ethical.

4. Perform a SWOT analysis.

Once businesses have gathered and reviewed all necessary data, they should perform a SWOT analysis — analyze the strengths, weaknesses, opportunities, and threats of each competitor.

This will help inform areas of possibility. Businesses can employ these insights to replicate strengths, avoid weaknesses, investigate unexplored opportunities, and prepare for potential threats.

5. Create a game plan.

Using the results of the SWOT analysis, while taking into account audience demographics and size, will help businesses assess each competitor’s overall standing in comparison to their own brand.

This data can then influence a new game plan (a.k.a. strategy) to apply these learnings and test out new tactics that may offer a competitive edge. Hypothetically, if a competitive analysis were to reveal that many kids’ entertainment competitors offer more preschool girl-skewing content that performs excellently for the brands, Nickelodeon could consider greenlighting more new series that meet this audience demand.

6. Continue tracking.

Just because a business has completed one competitive analysis doesn’t mean it’s necessarily set for the foreseeable future. Regularly monitoring competitor actions and changes and adjusting the competitive strategy to align with new trends is imperative to remaining fluid and forward-thinking within a changing industry landscape.

Businesses could consider implementing competitive intelligence software, which are AI-powered tools that can compile, analyze, and take action on competitor data and emerging trends. This can free up individual workers’ time to create and execute new strategies incorporating the knowledge gained from competitive analyses.

Our Market Research Kit includes a resource for getting started with data visualization for marketers.

10 Free Competitive Analysis Templates

Track and analyze your competitors with these ten free planning templates.

• SWOT Analysis
• Battle Cards
• Feature Comparison
• Strategic Overview

Download for free Learn more Download for free

Download Free

All fields are required.

You're all set!

Click this link to access this resource at any time.

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Competitive Analysis Templates

So you’re ready to conduct a competitive analysis. These templates can help you get started.

1. HubSpot’s Marketing Strategy Kit

Our Marketing Strategy Kit includes resources for getting started with your competitive analysis, including Porter’s five forces analysis and a SWOT analysis template.

You’ll also find guidance on conducting fact-finding surveys and focus groups, creating buyer personas, and a plug-and-play PowerPoint presentation to help you share your findings.

This is the empty SWOT template we provide inside the Market Research Kit. Here you can gather your findings and keep them organized on one sheet. This chart can easily be plugged into the provided PowerPoint presentation, making sharing findings a breeze.

2. MECLABS

The MECLABS Institute has a series of competitive analysis documents. If you’re looking to understand the forces shaping your industry, MECLABS’ resources can help you compile the research.

All of the charts that you complete can easily be turned into slides. The visuals make your analysis easy to understand.

3. Semrush Market Explorer

Source

You may feel overwhelmed about starting your research from scratch. Semrush can help. Before you start surveying the marketplace on foot, you can assess your competition entirely online.

Semrush offers a free trial that includes market research tools. Here you can see the size of your industry, available niches for your business to fill, and your competitors’ market potential.

You’ll also see how well your business can position itself with online search engines.

Competitive Analysis Example: Kids’ Edutainment App

Let’s say I want to create a new kids’ edutainment app named Learn ‘n Grow that develops educational games and content for kids 2 to 13. To track the viability of this new business, let’s utilize three different competitive analysis methods.

Porter’s Five Forces Analysis

Porter’s Five Forces analysis, created by Harvard professor Michael E. Porter, determines the elements influencing competitiveness within an industry. This framework identifies five key forces that manipulate the amount of market competition and impact a company’s ability to hold up against that competition.

The five forces are:

1. Competitive Rivalry. How intense is the competition within existing businesses in this industry?
2. Threat of New Entrants. How easy or difficult is it for new players to enter this industry and become competitive?
3. Supplier Power. How high is the demand for suppliers in this industry?
4. Buyer Power. How much influence do customers have over prices and products in this industry?
5. Threat of Substitutes. How likely is it that customers will find and switch to an alternative product or service outside of this industry?

Now that we understand this framework, I’ll walk through how to use this approach to analyze the new kids’ entertainment app.

1. Competitive Rivalry

• There are many successful kids’ entertainment services, including Nickelodeon, Disney, PBS KIDS, and Roblox. Learn ‘n Grow will need to compete with these large players.
• Many of these brands also already have edutainment apps, like Dora ABCs and PBS KIDS Games.
• Many of these apps are restricted to existing IP, whereas Learn ‘n Grow has the opportunity to introduce brand new characters and situations that can be specifically created to best inform each narrative.

2. Threat of New Entrants

• With the rise of gaming platforms, augmented reality (AR), and virtual reality (VR), kids have a plethora of modern, immersive, and exciting options that Learn ‘n Grow needs to compete with.

3. Supplier Power

• As an app developer, Learn ‘n Grow may need to hire third-party vendors to help with UX design, coding, and testing. How reliable are these suppliers?
• Instead of hiring a potentially unreliable third-party vendor, the app can hire in-house or freelance individuals who are experts in these fields, thus eliminating the need for suppliers.

4. Buyer Power

• Parents have many alternatives for edutainment content, many of which are available for free. What is the draw for them to download a paid app?
• Many parents now have a greater desire for educational content for their kids, rather than strictly entertaining content. Introducing an app that is proven to educate could be enticing enough to be worth the investment.
• More kids nowadays have their own smartphones and tablets, with parental supervision, making it easier for them to discover new apps and plead with their parents to purchase one that is particularly tempting.

5. Threat of Substitutes

• 68% of parents said their kids under six could benefit from a detox from technology. This means fewer parents may invest in an edutainment app and will turn to other screen-free media, such as books and toys.

Running a SWOT Analysis

A SWOT analysis can help Learn ‘n Grow better position itself in the market. Let’s run a SWOT analysis on competitor PBS KIDS Games, using the HubSpot template.

SWOT Analysis

From this SWOT analysis, we learned the following:

• Offering content for kids 2 to 13 will be a key differentiator for Learn ‘n Grow from PBS KIDS Games.
• Including multiplayer games and offering options to connect the app to social platforms will naturally make the app more shareable. In addition, introducing AR and VR will help Learn ‘n Grow innovate and keep the games engaging.
• There is an opportunity to offer downloadable printout materials, such as worksheets and coloring pages, for parents who occasionally want a screen-free alternative.

Customer Research

To understand how potential customers feel about kids’ edutainment apps, the Learn ‘n Grow team needs to conduct additional research. Here are some ways to perform customer research:

• Customer surveys, interviews, and focus groups. Tap parent consumers to inquire about app preferences, pain points, pros and cons of current apps they use, and switching motivations.
• Customer journey mapping. Map out the steps competitor customers take from initial awareness of an edutainment app through purchase to app loyalty. Then, find solutions for typical friction points to ensure retention.
• Online reviews. Read customer reviews on app stores, YouTube, app websites, and social media to note what parents have liked and disliked about edutainment apps.
• App testing. Recruit parent app users to test out features of the Learn ‘n Grow app, alongside other popular kids’ edutainment apps, to monitor any bugs, challenges, or missed opportunities.

After this research has been compiled, Learn ‘n Grow can present the findings to its business partner to ensure the insights are incorporated into the app UX and future marketing and sales strategies.

Competition is key.

Working at a beloved brand like Nickelodeon has taught me a lot about consumers. First, brand loyalty runs deep, so I recommend you balance remaining flexible against industry changes with maintaining the heart and core of your brand.

Second, just because a business is well-known and liked doesn’t mean it can’t be replaced with new brands experimenting with innovative technology and advancements that better meet consumer needs. That’s why competitor analysis is so imperative for businesses in all industries.

As electronic engineer Shuji Nakamura, co-inventor of the blue LED and recipient of the Nobel Prize in Physics, said, “It’s good to have high-quality competition; it helps drive research forward at a faster pace.” So prioritize competitor analysis to learn from the successes and shortcomings of high-quality contenders, and keep your business at the forefront of the race.

Editor's note: This post was originally published in August 2017 and has been updated for comprehensiveness.

10 Free Competitive Analysis Templates

Track and analyze your competitors with these ten free planning templates.

• SWOT Analysis
• Battle Cards
• Feature Comparison
• Strategic Overview

Download for free Learn more Download for free

Download Free

All fields are required.

You're all set!

Click this link to access this resource at any time.

Download Now