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					Marketing Templates


Competitive Analysis
By Michael Fischler
       INTRODUCTION

                                   Competitive intelligence is a critical
                                   component to many marketing
                                   plans and processes. It serves as
                                   a guide to pricing, a guide to
                                   positioning, a guide to whole
                                   product definition, and more. In
                                   fact, most of the issues you’ll deal
                                   with when you start to craft and
                                   plan your own marketing strategies
                                   and tactics are encountered when
                                   you research and report on
                                   your competition.

And this information is not just part of the domain of marketing.
Competitive information—product, pricing, trends and more—is
used across the organization: by R&D, by sales, by the members
of the board. And it is not just a snapshot either, but an ongoing
datapoint. Competitive analyses need to be performed
periodically—at a rate of frequency that reflects the dynamics of
the marketplace you’re in.

That’s why we’ve chosen to start our series of templates with
competitive analysis—not necessarily because it comes first in a
marketing plan, but because it serves as such a valuable guide
post for topics that come before, and for those the follow.




Marketing Templates                                    Competitive Analysis
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       CORE QUESTIONS
                                   The critical area here is to gather as
                                   much objective information as you
                                   can about your competition—as long
                                   as it’s useful. And what is useful will
                                   differ from company to company,
                                   market to market, industry to
                                   industry. A simple example is
                                   enough: If you are a provider of
                                   web services, your competitor’s
                                   facility square footage will not be
                                   meaningful…but it certainly would be
                                   if you’re a manufacturer.

1. WHAT IS THEIR PRODUCT?
    Do they provide a directly competitive product or an alternatively
    competitive product? By that we mean, does it address a problem
    in the same way (one automobile vs. another automobile) or in a
    different way (automobile vs. a bicycle).

2. WHAT IS THEIR REVENUE?
    Obviously, it’s easy to find this for public companies. Private
    companies are much more difficult, although you can assume that
    generally speaking, a private company has revenues under that of
    the public companies. But keep in mind that revenue is often not
    the most relevant information.




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       CORE QUESTIONS - continued
3. MARKET SHARE
    Market share is often more
    relevant than revenue (although
    unfortunately not easier to
    find). Again, some industries
    are heavily tracked by the
    analysts and in that case the
    information is not hard to find.
    Companies themselves often
    discuss their own market share
    in their annual reports (try
    searching for something simple
    like “Microsoft “market share” OR “marketshare.” You’ll also find
    that different estimates of the same size of a marketplace will be,
    well, different. In any event, market share is an extrapolated, not
    a calculated value and should be taken as guidance only.

4. WHAT IS THEIR HISTORY?
    You can learn a lot about a company—and perhaps especially
    about the strategic direction it might take—from its historical and
    recent past. See whether they’ve expanded product or reduced it.
    Notice whether they’ve gotten completely out of a marketplace,
    and if so, look for indications about why they’ve retreated. And if
    they’ve grown by acquisition, has this worked for them as a
    profitability strategy?




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       CORE QUESTIONS - continued
5. WHAT POSITION DO THEY TAKE IN THE MARKETPLACE?
    A company’s position in the marketplace is a statement—implied
    and articulated—of the core value it brings to the market. It may
    be “most reliable.” It may be “cheapest.” Notice both the explicit
    position—the one they use to promote and pitch themselves—and
    the implicit position—the one you’ll interpret by reading between
    the lines. For instance, if their “About Us” web section talks about
    how good their service is, you’ve got a company taking the explicit
    “service” position. If the rest of the site talks about product
    quality, you’ve got a company that is taking the implicit “quality
    product” position. These two should not be at odds, but if they are,
    you have a potentially vulnerable competitor.

6 . W H A T S E G M E N T S A R E T H E Y TARGETING?
    Not all companies segment their marketplace. But when they do,
    they define market segments in different ways. A segment could
    be income level (Ford Escort and Mercedes Benz), a specific
    industry (Pittsburgh Paints), or a specific demographic (Secret
    deodorant or Ford Mustang). There are many clues here, and most
    of them are clear. Sometimes, Pittsburgh Paints and Secret for
    instance, make explicit segment statements. Others make it clear
    through implication. Ford, for example, doesn’t come out and say
    the Mustang is a young person’s car, but its promotional imagery
    does the talking quite clearly.




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       CORE QUESTIONS - continued
7 . H O W H A V E T H E Y GROWN OR D I M I N I S H E D O V E R
    THE LAST ONE AND THE LAST THREE YEARS?

    Growth is measured in a lot of ways—all these roads eventually
    point to the same place. It may be revenue, it may be number of
    employees, it may be number of acquisitions. Look for raw
    numbers, not percentages, since a company that had one
    customer last year and two this year has experienced 100%
    growth year over year.

    This information is easy to find for public companies—track their
    stock over three years. But private companies are a little harder to
    gather information about. There are some techniques though.
    Looking through, for instance,
    PR Wire archives or their own
    historical press releases (if they
    exist) might give you insight. A
    great resource for this is
    archive.org, which will show you
    cached, but incomplete,
    versions of their web site for
    years past. A look through press
    releases over a three- to five-
    year historical period will help
    you track this as well.




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       CORE QUESTIONS - continued

8. WHO IS MOST VISIBLE?
    Which companies are getting the most pickup from the press, from
    the analysts, and from credible blogs in the marketplace. Take a
    fixed period of time—say six months prior to the date you create
    the plan—and perform media audits, analyst audits and blog audits
    for each competitor. Pay no attention, in this context, to the news
    wires and a company’s own web site. Look for pickups, not just
    releases. The wider a magazine’s circulation, or the more well
    respected the analyst, the higher the visibility.

9. WHAT ARE THEIR DISTRIBUTION CHANNELS?
    No secret here. Don’t enumerate, just list them broadly:
    distributors, sales reps and so on. If you can, try and figure out
    the structure of their channels (e.g., do they have master
    distributors who handle regions, and so on).

10. WHAT IS THEIR MARKETING BUDGET?
    This is an important question, and a difficult one to answer.
    Sometimes it can be found through a search engine. Sometimes
    it is listed in the company’s investor information. Usually neither
    of these is the case. You then have to extrapolate from existing
    indicators. For instance, ad spend—which is just one element of
    a marketing budget—can be found in many cases through the
    services of a company like TNS Media Intelligence.




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       FINDING THE INFORMATION

                                    Today, the Web is everyone’s
                                    primary source of information.
                                    And Google is the leading tool used
                                    to navigate the vast
                                    treasure of information. That’s why
                                    MarketingProfs prepared a special
                                    report for Premium members called
                                    Using Google as a Research Tool.
                                    You can find it here:
                                    MarketingProfs.com/r/google




ADDITIONAL SOURCES OF INFORMATION:
1. SEC AND OTHER INVESTOR INFORMATION
     SEC filings will tell you about public companies. You’ll typically
     find the information at the investor relations section of the
     company’s web site.

2. ARCHIVE.ORG
     What is viewed by most as a kind of novelty is really a primary
     tracking tool. You’ll find the site at http://www.archive.org. Use
     their “wayback machine” to see web sites dating back many
     years. It’s hardly perfect or complete, but you’ll be able to track
     growth, product evolution . . . everything that has changed from
     one site update to the next.




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                THE INFORMATION
       FINDING THE INFORMATION - continued


3. SECONDARY RESEARCH
     Analyst reports on companies
     and on market and industry
     trends are often valuable, and
     more often expensive. But you
     can often find statistics and
     information you’re looking for
     by entering the title of the
     report in Google. Often, a
     company cited in that report
     will get permission to republish
     it, or reporters and others will
     quote information from it.

4. PRIMARY RESEARCH
     Primary research goes by a number of names, each with a
     different focus. A market perception audit, for instance, tracks
     how the press and analysts view each company. A pricing study
     seeks to understand both the published and underlying pricing
     structures of the company (discount points, hidden costs, service
     and support revenues).

     Don’t be afraid to send your competition an email or call them
     and ask what you want to know. The difficulties are obvious, and
     the ways around those difficulties equally obvious.




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       FINDING THE INFORMATION - continued


5.   HIGHBEAM RESEARCH AND KNOWLEDGESTORM.
      These are two aggregators of various company and product
      information: some supplied by the companies and others
      gathered from public sources. Highbeam has a broader
      information reach, while KnowledgeStorm does a better job with
      details of each company.

6.   TNS MEDIA INTELLIGENCE
      TNS, formerly Adscope, will for a reasonable fee, search their
      database of trade magazines and business and general interest
      publications, and report on how often a company has advertised
      in which magazines. They’ll also tell you estimated ad spend
      where such information is available to them.

Please keep in mind these are all general resources, not industry-
specific ones. Most industries have associations that serve them and
analysts that track them specifically. For example, the Air and Waste
Management Association serves the environmental industry.
PhocusWright tracks and reports on the travel and hospitality space.




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          ORGANIZE AND ANALYZE

                                    By now you’ve gathered a lot of
                                    information. Now it’s time to
                                    organize it so that you can see at a
                                    glance where the competition stacks
                                    up. First, for each competitor, you
                                    want to list competitive products,
                                    positioning, market segments,
                                    marketing budget, distribution, and
                                    changes over three years. Then you
                                    can provide your analysis, including
                                    the competitor’s strengths and
                                    weaknesses.

Use the format below as your guide.


COMPETITOR ONE
[COMPANY] is a/an [YEARS] old company with principal office in
[LOCATION]. They currently employ [EMPLOYEE COUNT] employees, in
[BRANCHES] offices [SCOPE].

Their current office locations are:
1. City

2. City

3. City

4. City

5. City




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        ORGANIZE AND ANALYZE - continued


COMPETITIVE PRODUCTS
[COMPANY] currently manufactures and sells products that compete
[DIRECTLY/INDIRECTLY] with [YOUR CO]. These products are:

Product Name
Product Description (copied and pasted from existing information)



Product Pricing
$XXXX




Product Name
Product Description (copied and pasted from existing information)



Product Pricing
$XXXX


POSITIONING
[COMPANY] explicitly positions itself as [POSITION-TYPE].




[COMPANY’s] implied position is [POSITION-TYPE]




Marketing Templates                                      Competitive Analysis
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                                    11
        ORGANIZE AND ANALYZE - continued

SEGMENTATION
The following segments are identified explicitly as targets through the
company’s web site, it’s investor information, articles and quotations by and
from its officers and other sources.

1. Segment One




2. Segment Two




3. Segment Three




MARKETING BUDGET
Based on information found in [SOURCES], [COMPANY’s] marketing budget is
estimated at [XX%] of their annual revenue (alternative is to state this in
hard dollars).




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         ORGANIZE AND ANALYZE - continued

DISTRIBUTION
[COMPANY] uses an indirect channel with the following structure (use those
which apply or use others not listed):

1. Exclusive regional resellers


2. Non exclusive regional resellers


3. Master reseller/distributor


4. Manufacturer’s representatives


5. Independent sales agents


6. OEM


7. Bundling partnerships


CHANGES OVER THREE YEARS
[COMPANY] shows the following signs of having grown/diminished in the
following areas:

1. Revenue has increased/decreased by XX%


2. Employee headcount has increased/decreased by XX%


3. Number of products has increased/decreased by XX%


4. Number of channel partners has increased/decreased by XX%




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       ORGANIZE AND ANALYZE - continued

SUMMARY OF MARKET PERCEPTION
Strengths
Based on analyst reports, industry publications, and a general review of
online forums and blogs, [COMPANY] appears to have these strengths.

1. Strength

2. Strength

3. Strength

Based on first-hand knowledge, [COMPANY] appears to have the
following strengths.

1. Strength

2. Strength

3. Strength

Weaknesses
Based on analyst reports, industry publications, and a general review of online
forums and blogs, [COMPANY] appears to have the following weaknesses.

1. Weakness

2. Weakness

3. Weakness

Based on first-hand knowledge, [COMPANY] appears to have the
following weaknesses.

1. Weakness

2. Weakness

3. Weakness




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         ORGANIZE AND ANALYZE - continued
         ORGANIZE AND ANALYZE - continued
MARKET VISIBILITY AUDITS
Based on [SOURCES], [COMPANY] has appeared in the following
publications:


PUBLICATION     ADVERTISING      EDITORIAL    CLASSIFIED     BUYER’S GUIDE        OTHER

Magazine 1

Magazine 2

Newspaper


Based on [SOURCES], [COMPANY] is covered by the following analysts:


PUBLICATION      COMPARISON        TREND     REVIEW   SPECIAL REPORT          OTHER

Analyst 1

Analyst 2

Analyst 3


Based on [SOURCES], [COMPANY] has been mentioned in the following
relevant online sources:


PUBLICATION           POSITIVE     NEGATIVE        NEITHER        BOTH       OTHER

Website 1

Newsletter 2

Blog 3




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CHARTS AND GRAPHS

                                         Use Excel to generate the following
                                         four charts: competitive pricing,
                                         growth, resellers and press
                                         coverage. These will summarize
                                         your research and support your
                                         narrative analysis.




                                Competitive Pricing
Companies




            1st Qtr




                  $310   $315     $320   $325   $330    $335
                                    Prices

                      Ajax   Acme    Amalgamated       Consolidated
                                     CHARTS AND GRAPHS



                                     250
      Annual Revenue (in $000,000)




                                     200


                                     150

                                                                                   AJAX
                                     100                                           ACME
                                                                                   AMALGAMATED
                                                                                   CONSOLIDATED
                                     50


                                      0
                                           3 Years Past             Today

                                                 Competitive Company Growth




Marketing Templates                                                           Competitive Analysis
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       CHARTS AND GRAPHS



           Percentage of Resellers Carrying Competitive Product

                          ALPHA
                        UNLIMITED
                           12%                         ACME
                                                        21%


                ABC
           INTERNATIONAL
                10%

                                                          AJAX
          IMPERIAL                                        11%
          IMPORTS
             5%

                      IMPERIAL
                                                      CONSOLIDATED
                      EXPORTS
                                                          10%
                         14%


              JONES BROS
                  2%                SMITH BROS   AMALGAMATED
                                        20%          8%




Marketing Templates                                            Competitive Analysis
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                                          18
       CHARTS AND GRAPHS



                         Competitor Press Coverage in the Past Six Months


                                                                   Alpha Unlimite
                                    ABC Internation

                                                                                             Imperial Product

                                   Imperial Export
         Companies




                                                     Smith Bros

                           Jones Bros
                                                                              Amalgamated

                           Consolidate

                            Ajax

                                         Acme

                     0       10             20              30           40             50              60

                                                        Mentions




Principal Author: Michael Fischler

Michael Fischler is the founder and a principal of Markitek, a sales and
marketing consulting firm serving companies in a broad range of industries.
He is a widely recognized authority on issues of sales and marketing strategy
and tactics. Michael is a senior contributor with MarketingProfs, has published
extensively on issues within his expertise, and is a popular and well-received
speaker at conferences worldwide.




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