- A competitive analysis is a tool used to evaluate
the strengths and weaknesses of an
organization's competition.
This helps you to determine three basic things.
Let's say you're opening a new ice cream shop
and you visit some competing stores
to take a look at how they work.
The first thing you can learn from a competitive analysis
is what not to do.
The cones at this shop break before the customers
are able to finish eating the ice cream.
Then you can learn what the existing standard is.
Most ice cream shops offer a comfortable place to sit down,
maybe your shop should too.
Finally, you learn what the potential is to become better.
Your competitor only offers six flavors of ice cream.
Maybe your store should offer more.
Let's look at another example
that will help you explain how this works
in a design research process.
Let's say you've been hired to design a website
for a small furniture company.
They have an established business
that has been operating successfully
for the past twenty six years.
But they've never had a website.
Through your early conversations with the owners
you learn that they're leery
of going online with their business
because they prefer the idea of meeting
and working face to face with their customers.
In addition to having no online presence,
they only advertise in local newspapers
and other locally printed sources,
and they've been losing business
to a nearby shop that recently launched an online store.
This job requires multiple strategies for design,
advertising, and interacting with digital customers.
Rather than guessing or trying to invent new ways
to meet your client's needs,
you conduct a competitive analysis
to review how other similar companies have
transitioned to their businesses online.
So, how do you figure out who to review?
A great place to start is with a company
that the owners mentioned losing business to.
Always ask your client if they know
of any direct competition.
This will help you to get a better sense
of how to compare with similar business in their area
and what can be learned from them.
You can also look for additional furniture companies nearby
simply by searching online for them.
Also, think about the industry leaders.
Is there a large company that's well known
for online furniture sales?
If there is, then they should definitely be on your list.
Also, try to look at other businesses
that are local to the area
and have transitioned online.
Even if they're not direct competition
it might help to answer questions like
how the website should look and function.
So, the question is, once you know who to review
how do you get that information?
You could use a technique called Media Scanning
which is very similar to a literature review.
The main distinction between the two
is that with media scanning
you're reviewing materials written
and produced by the competing organizations.
This can be a variety of things depending on
the organization.
There might be a website, news articles,
social media platforms, or publications
like annual reports.
In some cases, visiting the business
can also be an effective technique.
You can learn a lot about the physical design
of the space, the service features of the machine,
or the interactions customers have with employees.
So, back to our example.
While reviewing one of the furniture shop competitors
you discover a website that provide links
back to the company's social media platforms.
Through their social media
you notice customers asking store employees
questions about the furniture.
And you also see customers leaving positive feedback
about their products and services.
So, your competitive analysis
made two important discoveries.
One you can link social media sites
with the website and allow owners
to have that digital connection
with their customers.
And two, sharing customer feedback through
your social media is a great way
to advertise the quality of the products
and the services that your client offers.
A competitive analysis may help to identify color palettes,
a standard of photography, and other functional elements
that can help dictate the components of your website design.
It's a useful tool to apply early in the design process
to help establish what the common practice is.
Establish ways to differentiate yourself from competition
and discover possible warnings
or mistakes to avoid.