Competitor analysis is important for every entrepreneur with big ideas particularly if you are launching a new product on Kickstarter. Understanding the market you plan to enter will also help to lay the foundation for your future business success.

In order to compete with your rivals and gain market share, you have to understand what they offer, so you can create an offer that differentiates from them and attracts users to support you.

Use Competitor analysis strategies as part of your Crowdfunding Marketing plans. Review previous campaigns that have succeeded (along with competitors in the market place). Analyse what messaging, pricing and content these companies use to attract backers and reach their funding goals. You can then use this info to develop a successful approach for your campaign.

How we define Competitive Analysis?

Competitive research usually includes an evaluation and analysis of competitors’ comparative strengths and limitations. It can consist of their existing and future product and service growth, price development, and marketing strategy.

Here are some important benefits of strategic research:

  • Market awareness
  • Product positioning
  • Improved consumer targeting
  • Estimating demand opportunities
  • Create a powerful offer

How should you start competitive research?

Split your competitive review into five main phases.

1. Find your true competitors

This seems simple, but the first step is important. Do you know who the main competition is? Locally and globally? Whether or not you want to admit it, your competitors are out there, and they are just as hungry as you are.

By researching online, you will be able to:

  • Build a list of the main players in the market
  • Capitalise on the vulnerabilities and strengths of your competition
  • Recognise, and keep competitive tabs on competitors so you are always 1 step ahead of them.

Google, Youtube, Facebook and Amazon are all great platforms to find competitors. By searching keywords related to your service or product, you’ll be able to determine your local and global competitors.

2. Competitor’s positioning strategy

Once you have your list of competitors you should review each one individually. Analyse their website, social channels and make notes about the messaging they use and how they present their offer. Ask your self:

  • Why exactly do consumers buy from them? Do they go for the price? The experience?
  • How do they differentiate their offering from the competition? What are the key selling points (USP) features, benefits, value proposition?
  • What makes your product or service special, in your opinion?

Answering these questions will help you to understand how your rival’s position themselves. And how you can create an offer that provides more value.

3. Pricing strategies to compete in the market

Now is the time to consider a pricing strategy that suits your product offer and fits in the market. There are three ways to value your product after a detailed review of your rivals.

Set your product’s price higher than your competitors:

In this strategy, set a high price point for your product when compared to your competitor. You may take this stance if you believe your product or brand is better quality, more luxurious, offers more than your competitors. Or maybe your competitor is undercharging, so you need to price at the correct value.

Set a similar price to your competitors:

In this strategy, you will set your price at a similar level to your competitor. But now the added value your product has to offer becomes your key focus and selling point. Even more so if your products and their specifications are the same as your competitors.

Set pricing lower than your competitor products:

Setting your prices low to undercut your competitor is a strategy that many people advise against but it can be a great way disrupt the market and gain customer loyalty, boost your sales, and increase your brand equity. But can you offer these prices long-term? Generally not, unless your product is of low quality and you have the profit margins then you can.

4. Websites comparison

A good strategic analysis also involves a summary of each competitor’s online footprint, particularly other sites apart from its website. For example review sites, forum, social channels. And the ‘comments’ section on a crowdfunding projects page. Reviewing these types of sites can provide great info on customer reviews, what they like about the product, what they don’t like and the type of content users are responding to, which can help you to develop a better product that is better than your competitors.

Now It’s time to finalise your offer and value proposition.

After carrying out your research, it’s time to finalise your product offer. Collate all of your ideas and information about your competitors. Ask yourself the reasons why a shopper purchases a good or service from a business? What’s important for these buyers? Is it comfort? Worth? Quality? Price? Anything else? Craft an offer that provides the outcome your target audience likes and wants while differentiating yourself from the competition.

Conclusion

Competitor research and analysis is a useful method used by almost all the world’s leading firms and is an important part of Crowdfunding Marketing. If you have not tried undertaking this yet for your campaign, consider doing so now. You’ll not only understand your competitor’s better, but you’ll also be well-positioned to understand how you can emulate and beat their success.