Businesses perform competitor analysis to gain insights into their competitors’ activities and identify areas for improvement in their own organization. By analyzing their competitors, businesses can develop strategies to outperform them. Geolocation technology can help businesses conduct competitor analysis more efficiently and obtain more comprehensive results.
Why is Competitor Analysis Important?
Competitor analysis is the process of identifying and studying the marketing strategies of business competitors. This allows businesses to compare themselves with their competitors and identify their own strengths and advantages.
Competitor analysis is important for several reasons:
- It helps businesses understand how to improve their strategiesÂ
- Outperform competitors in attracting consumer attention.Â
- Discovering gaps in the market or industry.
Types of Competitors
Competitors can be categorized as direct, indirect, and substitute. Each type has its own definition and meaning.
Direct competitors
Direct competitors are those businesses that offer similar products or services, target the same market and consumers, and aim to achieve similar profits and market share as our business.
In other words, competitors are those who sell similar products or services to ours, have similar strategies, and target the same audience. This can also mean that when consumers buy from competitors, they are less likely to choose our products.
Indirect competitors
Indirect competitors are those businesses that offer different products or services from us but can meet the needs and desires of the same consumer base.
For instance, a business that sells chicken dishes can have indirect competition with restaurant A which sells pizza. Both businesses target consumers who want to enjoy food, although their products are different.
Substitute competitors
Substitute competitors are those businesses that offer products or services as alternatives to replace the goods we sell. These businesses deal with the same problem but adopt different approaches.
For example, restaurants and cafes in the same area can be substitute competitors. This is because some consumers may choose to have lunch at a restaurant, while others might choose to go to a cafe.
How Geolocation Helps Businesses in Competitor Analysis
Geolocation and location analytics can provide businesses with valuable insights about their competitors, such as:
- Â Identifying where competitors operate and for how long certain stores have been open or closed.
- Discovering potential locations where competitors have not yet established their businesses.
- Analyzing basic customer profiles and foot traffic in a specific region.
- Monitoring particular locations to open new stores or branches by understanding the competition in that area.
- Evaluating the performance of competitors’ businesses in a region.
- Understanding the coverage or reach of competitors.
How Often Should Businesses Conduct Competitor Analysis?
To stay relevant and succeed in the business world, it’s important to continually understand consumer needs and follow the latest trends in the industry.Â
The frequency of competitor analysis can vary depending on the type of industry, but ideally conducting it every quarter or once a year is a good option. This time period provides businesses with enough time to respond to changes and evaluate their progress.
Perform Competitor Analysis with LOKASI Intelligence
If a business wants to perform competitor analysis, LOKASI Intelligence can help. LOKASI is a geospatial and location analytics platform that allows businesses to identify competitors.Â
Through LOKASI, businesses can learn about competitor locations, their reach, foot traffic, demographics, and more.
Learn more about how LOKASI Intelligence can help businesses by contacting email: [email protected] or WA: 087779077750
FAQ
What are the two types of competitors in competitor analysis?
There are two types of competitors in competitor analysis: direct competitors and indirect competitors.
What is meant by competitor analysis?
A competitor analysis is a method for identifying business competitors and analyzing their marketing strategies.
How does geolocation help competitor analysis?
Geolocation and location analytics assist in competitor analysis by providing detailed information about business competitors, such as knowing where competitors operate and how long certain stores have been open, as well as which stores have closed, finding places where competitors have not yet opened businesses, and those places have good potential, and so on.
