Overseas Trade Marketing Plan 3: Competitor Analysis

Competitor Analysis

Practically speaking, this activity is the mirror image of the company analysis. The company analysis is inward-looking, i.e. it is an evaluation of the company’s internal strengths in terms of the challenges faced by entering a new market. The competitor analysis looks outward, i.e. it evaluates the companies offering comparable products and services to the target market, and, as much as is possible, understanding the bases of their capability and strengths, since by so doing, any weaknesses or overlooked opportunities can be identified. Of particular interest will be the supplier networks used by successful companies to create their products. Are they sourcing locally or shipping in standard products that are then localised? What are the costs likely to be? When this is understood, several important questions arise: can and should a competitor’s model be replicated as closely as possible, or should different, less costly but untried processes be applied? Also, what level of margin are the firm’s competitors operating on? Is their product offering something we wish to imitate directly (making only the most minor changes), improve upon (and ask a higher price for), or undermine by placing a low cost/low quality substitute on the market? For each scenario, do we know how are our competitors are likely to respond? Full understanding and analyses of market share and segmentation, and the target market segment especially, will furnish answers. Strategy should be modified to reflect this analysis and product design and marketing practice formulated for maximum relevance to the target market.