THIS ARTICLE EXPLORES WHY COMPETITOR ANALYSIS IS SO IMPORTANT TO E-COMMERCE BUSINESSES, AND HOW TO CONDUCT ONE, STEP BY STEP. PLUS, WE’VE INCLUDED A FREE COMPETITOR ANALYSIS TEMPLATE TO HELP YOU ON YOUR WAY.
With online shoppers accustomed to flipping between multiple web stores at the click of a button, it can be a huge challenge to win their attention. No matter how specialized or niche the product you’re selling may be, you’ll always be competing with the hundreds (if not thousands) of similar e-tailers the web has to offer. And every one of these online competitors is a threat to your profitability.
Conducting a thorough competitor analysis should be a crucial part of your business strategy. A successful competitor analysis will help you:
- Learn best practices to market and sell more effectively
- Identify gaps in the market where customer demand is not being met – demand you can develop your business to meet
- Uncover market trends that can influence your business strategies moving forward
All of which means, more sales for your business!
Successful competitor analysis comes down to research. First stop: Google. The easiest place to start is with a good old-fashioned browse on the search-engine. Try Googling different keywords related to your product or service and look at the first three or four website results – in Google's world, page ranking is everything, so brands who have landed one of these golden top spots are your biggest competition for new customers’ business. Dive into their websites and check:
- Product/service overview. What are these competitors offering? Who are their target customers? Where are there overlaps with your business?
- What are their strengths? Does their product have a USP that gives it a competitive edge?
- What are their weaknesses? Where can you improve on their offering?
- How are their products priced? Are they selling something similar to you but for much less? or are they offering a more premium price that you can safely undercut?
- What delivery options do they offer? You may be surprised how significant this is. In a recent consumer survey, 66% of e-commerce shoppers said they bought goods from one brand in preference to another because the delivery services on offer were more appealing.1
- What social media presence do they have? Do they have an omnichannel strategy driving traffic to their website? And how do they promote themselves on social?
- Further analytics insights, such as sales data and website traffic. This is your secret weapon - we will explore how to source these later in the article.
There are a lot of questions, but we’ve made it simple for you and condensed all the key considerations into a free competitor analysis template – download it at the bottom of this page.
Of course, you’ll need to compare your findings with your own e-commerce business to see how you measure up – what you’re doing well, and where you need to up your game.
A SWOT analysis will help you do just that.
STRENGTHS – where does your business have an advantage over your competitors? These are the things you need to exploit! WEAKNESSES – what are the areas that require improvement and investment? OPPORTUNITIES – where can your business grow? How can you reach new customers and increase your market share? THREATS – what are the external factors that threaten your profitability and how can you mitigate them?
These analyses will allow you to establish priorities for action which you can integrate into your business strategy going forward. We have included the SWOT points in our template too, so get started!
Google browsing aside, to really know your online competitors you’ll have to take a deeper dive into their performance analytics. Luckily, there are plenty of tools to help you do so – perhaps most importantly, those that will allow you to improve your SERPs (Search Engine Results Pages) position. An analysis by SEO specialist Backlinko2 found the top result in Google’s organic search results has an average Click Through Rate of 31.7%3. Furthermore, only 0.78% of Google searchers clicked on something from the wilderness of the second page. It’s no surprise then, that there is a whole SEO-focused industry dedicated to helping e-commerce businesses land a prized position at the top of the first page.
You could start with SpyFu4, a search tool that will show you competitor analysis keywords and what terms these sites have invested in on Google AdWords, alongside every ad test they’ve run. It reveals the keywords they’re ranking for, so you can work backwards to see which of their backlinks and content are bringing them the ranking, and use those findings to influence your advertising. It's sneaky, but that's half the fun!
SEMrush5 is an all-in-one digital marketing suite, impressive due to the sheer scale of data it can source. SEMrush’s software analyzes SEO, PPC (pay-per-click) advertising, keyword research, social media and content – to name just a few. You can tailor the tool to your specific needs, whether that is identifying competitors’ highest-ranking keywords, their strategies and budgets, or their best-performing product listing ads.
Beyond SEO-focused tools, the following will also help you understand more about your competitors’ online presence:
With a database of 42,237+ web technologies and over a quarter of a billion websites, this business intelligence tool will show you which technologies your competitors are using on their websites – such as shopping carts – and how they’re performing. So, if you're building an e-commerce website for the first time, these insights will serve as a best practice guide. And that’s not all. BuiltWith will also provide you with competitor sales intelligence and analytics reports. You can use these insights to build lists of your competitors and identify key market segments that your brand may be missing out on.
A market intelligence tool regularly used by DHL Express to help e-commerce businesses identify and qualify new customers. SimilarWeb’s in-depth analytics reports will give you an overview of your competitors’ performance to benchmark against, including their online strategies, website visitor numbers (and bounce rate), consumer intent and customers’ demographic makeup.
Once you’ve gathered the necessary analytics, add them to your competitor analysis template. They should act as KPIs by which to measure your business's performance, and to help you set goals for the future.
Analytics aside, sometimes there’s no better way to understand a brand’s success than learning its customers’ motivations. Browsing on customer review websites such as Trustpilot8 means you can monitor the conversations around your competitors’ businesses. What do they like about the product? What are the pain points? You can use these insights to improve or adapt your product. Similarly, Talkwalker’s Quick Search9 is worth a look too. The social search engine scans social networks, news sites, blogs and forums to find customers’ opinions and trends in real-time.
Last, but by no means least, is the unrivaled industry knowledge of DHL. As experts in international shipping, we can help your e-commerce business sell to markets where your competitors aren’t. Our E-commerce Health Check will analyze your business in a few simple steps and identify opportunities where it can grow its exports. Get started now!
And, we can help you implement checkout options that are proven to improve sales10 – such as Express delivery or international currency options. Don’t let a potential customer choose a competitor’s product over yours just because theirs would arrive quicker!
Apply for a DHL Express business international account and we’ll help your e-commerce business reach its full potential.
Download your FREE competitor analysis template here and start to get a lead on your competition!