Most business leaders feel they understand their competition. They can reel off a list of companies that they're up against and why. But, in the dog-eat-dog world of digital marketing, the term 'competitor' becomes more complex. Many SMEs fail to see the the true picture and base their digital marketing strategy on competing against businesses who aren’t their true competition - ultimately wasting time and effort.
When you’re working out who your competition is for a digital marketing strategy, it’s critical to pay attention to who you’re competing against specifically in the digital space - be that on search engine rankings, paid search adverts, email marketing or affiliate campaigns.
There are a few ways of doing this - the simplest, and most worthwhile, is searching Google for the top 20 or 30 terms relevant to your business and keeping a list of the companies that appear on the first page of Google. Getting good search rankings in competitive markets isn’t easy so these competitors are likely to have invested heavily to get these rankings.
Google Alerts is a free tool from Google that will send you notifications whenever a new article is picked up by Google News for any keyword you specify. You can use this to find out when your business sector, or a product you sell is being mentioned. From this you can compile a list of companies that are actively pursuing digital PR and getting coverage from it.
Find out who your competitors’ customers are, and how much money they’ve got!
A little known tool, outside of the digital marketing industry, is the Double Click Ad Planner from Google and this is a great tool for finding out detailed demographic information about your competitors’ customers.
As well as giving you reliable figures on how many visitors your competitor’s website gets, and how this has changed over the past year, you can also find out the age of their customers, how much they earn, their gender split, education level and much more.
By knowing the demographic of the customer your rivals are attracting, you’ll have a really good starting point for planning your own digital marketing strategy to focus in on the kind of customer you want to attract.
See how much your competitors make through their websites
One thing we’re asked regularly by our e-commerce customers is, 'How well does my competitor’s website convert?' or 'How much is my competitor making?' and in truth, these can be really simple questions to answer.
Granted, you’ll never get 100% accurate figures but you can go some way to finding this out and getting a good understanding of where you sit amongst your competition in terms of commercial success.
Many websites, particularly e-commerce sites, operate affiliate marketing campaigns where other people drive traffic to their website in exchange for a percentage of any sales they generate. In order to attract new affiliates, your competitors need to publish some pretty crucial figures that can be really useful to you when doing your research.
Each site will publish their commission rate (how much they’ll pay the affiliate), conversion rate (how many visitors become customers) and their earnings per click (how much each visitor an affiliate sends is worth).
With those three insights you can not only work out a competitor's average order value, which is useful in its own right, but with the visitor numbers you’ve already taken from Double Click Ad Planner you can also work out roughly how much any of your competitors have made through their e-commerce site in the past 12 months.
The amount of insight you can generate through using this, and other publicly available data, both on who your true competitors are, and how to beat them, can surprise even the most savvy of business leaders.
Andrew Banks is founder of Squeeze Digital Marketing, a digital strategy and online marketing agency.