Competitor analytics

Competitor analytics turns evidence about rival and substitute offerings into a structured view of the competitive landscape. It supports marketing and strategy by distinguishing the businesses that materially affect customer choice from organisations that merely look similar. The analysis clarifies who the relevant competitors are, how customers perceive them, where they sit in the market and how their position compares with yours.

When to use it

The appropriate review cycle depends on market volatility. In a fluid industry with frequent entry, exit and repositioning, complete the analysis at least annually and monitor important signals between reviews. In a stable industry where the main participants change slowly, a full refresh every two years may be sufficient.

Revisit the findings whenever a consequential strategic decision is being prepared. This makes it possible to anticipate how a move could affect competitors, estimate their likely responses and prepare appropriate countermeasures.

The analysis should answer questions such as:

• Which competitors matter most, and what evidence makes them relevant?
• What is each key competitor trying to achieve, and how do those objectives differ from ours?
• Where is each competitor stronger or weaker?
• What threats could each one create?
• What opportunities arise from their choices or limitations?
• Which strategies are they following, and what could those strategies mean for us?
• Given their previous actions, how might they react to a change in our business?

Origins

Competitor analysis has roots in military intelligence, economics and long-standing commercial market research. It became a more explicit management discipline during the rise of strategic planning in the 1960s and 1970s. Michael Porter’s Competitive Strategy then supplied a widely adopted structure for analysing industries and individual competitors through their future goals, assumptions, current strategy and capabilities. Digital data, online reviews and text and sentiment analysis later expanded both the scale and timeliness of the evidence available.

What it is

The process compares competitors’ objectives, positions, capabilities, offers and behaviour. A well-maintained competitor set reveals opportunities created by a rival’s weakness and threats created by its strength. It also brings evidence about several competitors into one consistent view, avoiding the distorted perspective produced by isolated anecdotes or an exclusive focus on the most visible rival.

Why it matters

No organisation operates independently of its market. Several businesses may be competing for the same customer budget, while substitutes can change the need for the category itself. Sustained performance therefore requires an informed view of market developments and of how customers perceive both your offer and the alternatives.

Competitor analytics makes relative advantages and disadvantages visible. It can also improve forecasts of rival behaviour: observed objectives, resources and response patterns provide a more defensible basis for anticipating reactions to a new product, price or channel move. The result is not certainty, but a better-prepared strategic decision.