Using Market Research to Guide Your Marketing Strategies: Part 2
Competitive Analysis (SWOT) & Brand Positioning
In our previous newsletter, we discussed how market research can help to guide your marketing strategies toward a more practical and efficient approach, delving into the importance of market research and target audiences. In case you missed it, here’s a quick recap:
PART 1 RECAP
Success is only as effective as the marketing strategy behind it. If you are to propel your business toward increased profits and ROI, you should consider four key components:
- Market research – Research is the backbone of your marketing strategy and serves as the foundation from which all strategies and tactics are developed and executed. Identify consumer buying habits in the industry, market size, market growth or decline, and any current trends
- Target Market – A well-designed target market identifies your most likely buyers or “customer personas,” allowing you to discover the best approach to engage each of the different target audiences.
- Competitive Analysis & SWOT – You need to know your competitors and how your products and services are different. What is the price point at which your competitors are selling, and what segment of the market are they aiming to reach? Knowing the ins and outs of your competitors will help you better position your business to stand out in the minds of consumers.
- Positioning – What is the perception of your brand in the marketplace? The difference in how the target market sees you is your positioning. Therefore, you want to develop compelling branding and marketing messages that clearly communicate how you want to be perceived.
Market research is a systematic method of data collection and analysis that offers critical information about your audience and overall business landscape. It is one of the most effective ways to gain insight into your consumer base, competitors, and the overall market/industry. The goal here is to equip your company with the ammunition needed to make informed decisions, especially when it comes to developing effective strategies.
In this article, we will pick up where we left off, presenting key concepts of competitive analyses (SWOT Analysis) and brand positioning, as well as the importance of market data in developing effective marketing strategies.
COMPETITIVE ANALYSIS & SWOT
Market research is the way in which a company gathers information about customer needs and market drivers. Competitive analysis is a subset of market research, in which you investigate your competition, identifying the major competitors and research their products, sales, and marketing strategies.
By doing this, you can create solid business strategies that build upon and improve upon your competitors’ methods. This helps you learn from other businesses competing for your potential customers, and is essential to defining your competitive edge that will create sustainable revenue.
An important part of analyzing your market and competition is the SWOT Analysis, an effective market research analysis technique that serves as an acronym for: Strengths, Weakness, Opportunities, and Threats.
SWOT analysis is often used as a strategic planning exercise. The framework is considered a powerful tool for decision-making as it enables an organization to uncover opportunities for success that were previously unseen, and highlights threats at the onset before they become seriously problematic. SWOT accomplishes this by analyzing the internal and external factors that can impact the viability of a decision. For example, employing a SWOT analysis can help identify a market niche in which a business might have a better competitive advantage.
Strengths and weaknesses are primarily for internal analyses of an organization (in terms of market reputation, manufacturing line location, patents, etc.). Opportunities and threats are external (as far as competition, prices, associated partners, etc.) to an organization and they have no control over the changes that might occur to these external factors.
Strengths – internal attributes and resources that support a successful outcome; depicts the positive factors of an organization.
- What does your organization do better than the competition?
- Ex. – Positive attributes of key stakeholders in terms of experience, knowledge, educational background, and such skills that contribute towards the performance of an organization, etc.; can include tangible aspects such as distribution channel, existing customer base, generated finance, accessories, etc.
Weaknesses – internal attributes and elements working against a successful outcome; contribute to an organization’s competitive disadvantage.
- What does your organization need to improve upon?
- Ex. – Segments such as subject matter expertise, lack of financial support, unavailability of appropriate technological tools for training, an inappropriate location of the organization, etc.
Opportunities – external factors that the organization can capitalize on or use to its advantage; attractive prospects/offerings that could contribute toward more profits.
- What market trends could lead to an increase in sales?
- Ex. – Opportunities are generally the outcome of revenue/market growth, changes in market perception, a solution to difficulties faced in the current market, or the ability of an organization to add value to the market, etc.
Threats – external factors that could jeopardize the organization’s success.
- What are the advantages competitors have over your organization?
- Ex. – Competitors, change in government policies, bad press coverage for products/services, shift in consumer behavior, change in market dynamics that could effect perception of certain products, etc.
Once the SWOT factors are identified, decision-makers should be better able to discern if an initiative, project or product/service is worth pursuing, and what is needed to ensure its success. As such, the objective of this analysis aims to help a company match its resources to the competitive working environment.
Again and again, we see that the process of conducting research helps businesses gain insight into essential elements of your business strategy, and that includes competitor strategies and behavior. By learning about your competitor’s strengths and weaknesses, now you can understand how to better position your product or offering.
BRAND POSITIONING & THE 4 Ps
As part of creating your market strategy, in order to determine your position in the market, you must first decide on a segment of the market that you want to target (this segment should be profitable — either with many customers, or a niche segmentation in the market that presents an opportunity due to a lack of competition). Once you know who you are targeting, then it’s time to find the sweet spot.
A business must decide how to make their brand as attractive as possible to the market being targeted. Market research and brand positioning strategy are often viewed as complementary processes which go hand-in-hand to deliver maximum results in building a powerful and distinguished brand identity.
Positioning is one of the fundamental elements of marketing, both for consumer products (B2C) and B2B. Positioning is a unique way of provide value to your customers. Effective positioning provides you with a unique selling proposition (aka “USP”), or points of difference. USP gives you the competitive edge that will help your business stand out from the competition.
The 4 Ps (“Marketing Mix)
- Product – product refers to a good or service that a company offers to customers. Typically, a product should fulfill an existing consumer demand; on the other hand, a product may be so compelling that consumers believe they need it, which in turn creates a new demand.
- Price – price is the cost consumers pay for a product. Marketers must link the price to the product’s real and perceived value, but they also must consider supply costs, seasonal discounts, and competitors’ prices.
- Place – how (where) your business gets its products/services in front of interested customers; When a company makes decisions regarding place, they are trying to determine where they should sell a product and best delivery method.
- Promotion – promotion includes advertising, PR, and promotional strategy. The goal of promoting a product is to reveal to consumers why they need it and why they should pay a certain price for it.
Where does a brand sit in the hearts and minds of customers? The associations that consumers hold toward a brand reflect its positioning. Positioning is achieved through an exercise called the 4 Ps (or the “marketing mix”), and together these make up the four pillars of a successful marketing strategy. The more detailed your positioning strategy is when defining the Ps, the more effective your overall strategy will ultimately be.
PKDATA & H2O MARKETING SOLUTIONS CAN HELP
Market research can provide your company invaluable information. This data can tell you how your company is perceived by the target customers you want to reach, help you understand how to connect with them, or show how you stack up against the competition. This research will greatly aid your efforts in developing the next steps of your marketing strategy, and is a critical tool in making informed decisions for the benefit of your company.
But where can you find this information?
Choosing the perfect market research partner, like Pkdata, is as important as selecting a highly-skilled strategy firm when starting on a branding project. While it’s possible to conduct market research in-house, in many cases a professional market research agency will be far more effective in terms of sample selection, study design and data analysis. This is where Pkdata can assist! Pkdata is well-versed in gathering market data in niche industries, specifically the pool and spa sector.
Unsure of how to interpret or apply research data?
H2O’s consulting services can help guide your marketing efforts in the right direction by enhancing your approach and allocating your budget where it will be most impactful. Though final analysis is dependent on your goals, H2O’s methodology usually begins with a thorough analysis of your online presence, current marketing structure, local competition, target market(s), and audience demographics. H2O excels in market consulting, as well as the planning and execution of marketing services based on data-driven promotional strategies.
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