7 steps to create a competitive landscape analysis

It’s not enough to respond to competitors’ moves. You have to anticipate them. To gain this foresight in your own market, companies must conduct an ongoing competitive landscape analysis.

A competitive landscape analysis is the ongoing process of identifying, researching, and evaluating competitors, in order to glean insight to inform your business strategy. It’s a way to evaluate competitor strengths and weaknesses today—and also observe how they’ve evolved. Your competitors’ evolution in the marketplace is just as important, if not more so, than taking a snapshot of their current standing. It’s what allows you to identify changes they’ve made along the way or moments where they pivoted, which monumentally influenced their upward trajectory.

Your competitive landscape analysis should include:

Businesses need to adopt a forward-thinking outlook. A competitive landscape analysis helps you determine the next steps for your brand and business. It’s no longer enough to rely on gut instincts. Data must be leveraged to inform decisions, surface opportunities, and identify and mitigate risks that might not even be on your company’s radar yet.  

Let’s use Blockbuster, which was the most popular US video store in 2000, and Netflix as an example.

In 2000, Netflix co-founders Reed Hastings and Marc Randolph met with former Blockbuster CEO John Antioco, in hopes of selling their then DVD-by-mail rental company for $50 million. At the time, Netflix was growing in subscriber base, but still losing more than it was making, reported Newsweek. The offer was declined by Blockbuster. 

In 2021, Netflix became worth billions, while only one Blockbuster remains in Bend, Oregon.

How did this happen?

Netflix listened to customers and anticipated their needs before they became common knowledge—the desire to watch movies from the comfort and convenience of their own homes. This underscores the urgency of conducting and analyzing your competitive landscape on a regular basis.

In a study of 250 C-suite executives, 88% said feedback data is very or extremely valuable in helping them make business decisions at their organization. Executives who work for companies that value feedback most were also 20x more likely to feel extremely confident in their ability to change direction based on new information, compared to companies that found feedback somewhat or not valuable.   

Here are 4 reasons why competitive landscape analysis is so important:

Competitive landscapes help you look beyond today and see what opportunities lie ahead. Just like Netflix, which started with DVD-by-mail rental, companies must regularly listen to customers in order to anticipate needs before they’re widely known. Through competitive landscape analysis, you’ll learn more about your competitors and your customers, too.  

Your UVP is what your business does better than anyone else. It could be related to your company, products or services, or even operations. As an example, you can find many of the same products on Amazon that are also being sold at Walmart or large department stores. However, Amazon sets itself apart from competitors with its fast delivery speed and convenient returns. A competitive landscape analysis can help you identify your company’s UVP and how to best market it to customers.  

We work in and on companies and brands daily, which makes it challenging to maintain an objective viewpoint. Competitive landscapes allow you to take a step back and see how customers view your brand as a stand-alone entity and in comparison to competitors. You can also discover why they are more (or less) likely to buy your product or service. Once you know where you land on their “list,” you can start to define strategic ways to move up in priority. 

Before you can improve your standing against competitors, you have to know where you are now. This is called a “competitive benchmark” and it’s essentially your starting point. How do you fare against top competitors right now in key areas that are hard to quantify, such as customer satisfaction and loyalty, employee engagement, and brand awareness? Your competitive benchmark provides a snapshot of where you started so you can set goals and track progress toward them.  

Learn more about SurveyMonkey Benchmarks, which are built right into the platform and can be applied to all your market research projects.

Your competitive landscape is always changing and evolving. Technology and customer behavior changes. As such, your competitive landscape analysis should be a living report that gets dynamically updated and analyzed at a scheduled cadence (annually, semiannually, or quarterly). So, how do you analyze a competitive landscape?

Choose up to 10 competitors and sort them into 4 categories: direct, indirect, perceived, and aspirational. 

Direct competitors have a similar business premise and sell a similar product or service to the same audience. Your customers are directly choosing amongst these brands and yours when they make their purchasing decision. These are the brand names that your sales team likely hears time and again in the sales process. For example, consider sportswear brands Nike and Adidas.     

Indirect competitors offer a higher or lower-end version of your product or service to a different audience. The price point is often a key differentiator between your brand and theirs. For example, Nike and Adidas are direct competitors, whereas UK sportswear Ashmei is an indirect competitor to both brands. 

Perceived competitors offer products or services that are fundamentally different from yours and solve a different problem. Your company doesn’t view them as a competitor, but the public does. These brand names might not come up as often as direct or indirect competitors in the sales process, but your team is still having to explain why your product or solution isn’t the same as theirs on occasion.