Introduction
In today’s highly competitive landscape for home contractors, construction, and home service businesses, understanding your local competition is no longer optional—it’s essential. According to a report by IBISWorld, the home improvement industry alone was worth $105 billion in 2022. With such a high-stakes environment, you can’t afford to ignore who you’re up against.
In this comprehensive article, we’ll walk you through the various tools you can use for a detailed local competition market analysis. We’ll also provide a checklist for evaluating your local competitors and how to utilize this valuable information to craft a winning marketing strategy. This post aims to empower you, the business owners and executives, with actionable insights to stay ahead of the game.
Why Understanding Your Local Competition Matters
Ignoring your local competitors is like navigating through a maze with a blindfold on. A staggering 85% of consumers use the internet to find local businesses. This means that if your local competitors have a better online presence or offer something more appealing to the consumers in your area, you risk falling behind. Here’s why understanding your local competition is crucial:
- Influence on Customer Choices: Knowing what your local competitors offer can give you insights into consumer behavior and preferences.
- Competitive Edge: Analyzing your competition can help you identify gaps in the market, providing you with the opportunity to offer something unique.
Learn How A Home Decor Manufacturer Leveraged Paid Media To Increase Revenue by 300%
Learn How A Home Decor Manufacturer Leveraged Paid Media To Increase Revenue by 300%
Learn How A Home Decor Manufacturer Leveraged Paid Media To Increase Revenue by 300%
Tools to Understand Your Local Competition
Analyzing local competition might sound daunting, but fortunately, there are several tools available to make the process easier and more effective.
Google Business Profile (Formerly Google My Business)
This is a must-use tool for any local business. It can tell you where you rank in local searches and offer insights into what customers are saying about both you and your competitors. It also provides valuable data on how people are interacting with your business online. Here’s how you can use Google Business Profile for your local market analysis:
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- Rankings: Are you appearing in the “Local 3-Pack,” the top three local businesses for your industry in the search results? If not, check who is. What are they doing differently?
- Reviews: What are customers saying? High ratings can be a strong indicator of customer satisfaction. Low ratings and negative comments can provide insights into areas for improvement.
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SEMrush
SEMrush is an excellent tool for analyzing your competitors’ SEO strategies. Use this tool to understand what keywords they are ranking for and how much organic traffic they are getting.
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- Keyword Analysis: Are your competitors ranking for keywords you haven’t even thought of? Maybe it’s time to expand your keyword strategy.
- Backlinks: Who is linking to them? Backlinks are a significant factor in how well a site ranks. If your competitors are getting high-quality links, it’s worth investigating how.
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Social Media Analytics
Platforms like Facebook Insights and Twitter Analytics provide a wealth of information about how your competitors are doing on social media.
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- Engagement: Are their followers active? Are they sharing and commenting on posts? High engagement rates often translate into strong brand loyalty.
- Posting Frequency: How often do they post? Too much can annoy followers, while too little can result in lost opportunities to engage.
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See how tailoring your website with Cloud Digital leads to massive returns
See how tailoring your website with Cloud Digital leads to massive returns
Local News and Business Directories
Don’t underestimate the power of traditional media and directories like Yellow Pages or local business publications. They can give you insights into your competitors’ public relations activities and their standing in the community.
The Comprehensive Checklist to Evaluate Your Local Competition
Understanding your competition requires a thorough investigation, and that’s exactly what this checklist aims to guide you through. Let’s dive in:
Analyze Google My Business Rankings
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Are you in the top 3? Check to see if you’re in Google’s “Local 3-Pack.” If not, analyze the businesses that are. What do their profiles have that yours doesn’t?
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Reviews: Pay close attention to customer reviews. What are the common praises or complaints?
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Check Social Media Engagement
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Frequency of Posts: Track how often your competitors are posting updates. This can give you an idea of what level of social media activity is effective in your industry.
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Engagement Rates: Look at likes, shares, and comments to gauge the level of audience interest and engagement.
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Examine Website & SEO Factors
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Website Traffic: Use tools like SEMrush or SimilarWeb to gauge your competitors’ monthly website traffic.
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Keyword Rankings: Which keywords are driving traffic to their website? You can find this out using various SEO tools like Ahrefs or Google’s Keyword Planner.
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Organic Evaluation: Assess the quality of the organic traffic they are getting. Are they ranking for relevant keywords?
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Google Search Rankings: Where do they stand in Google’s organic search for industry-specific keywords?
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Paid Media Assessment
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Are They Running Ads?: Use tools like SpyFu or SEMrush to find out if your competitors are using paid media like PPC or display ads.
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Ad Messaging: What messaging are they using in their ads? This can offer insights into their marketing strategies and USPs.
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Market Share Analysis
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Revenue Estimates: Although exact numbers might not be available, look for public records or reports that can give you a clue about their market share.
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Customer Base: Reviews, testimonials, and social media followers can provide a rough idea of the size of their customer base compared to yours.
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Service and Product Offerings
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Range of Services/Products: Make a list of what they offer versus what you offer. Are there gaps in your services that you can fill?
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Pricing Strategy: Are they pricing higher or lower than you? Any bundle deals or discounts?
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Customer Service Quality
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Availability: What hours are they available for customer service? Do they offer 24/7 support?
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Response Time: Test how quickly they respond to customer inquiries or complaints.
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By thoroughly running through this checklist, you will not only understand where you stand compared to your local competitors but also identify opportunities for growth and improvement. The next step is to use this data to optimize your strategies in all the areas outlined above, from Google My Business to market share.
Is your strategy actually designed to give you a competitive edge? Conduct your own expert analysis.
Is your strategy actually designed to give you a competitive edge? Conduct your own expert analysis.
How to Use this Information
Alright, now that you’ve got a wealth of information, what should you do with it?
Crafting Your Unique Selling Proposition (USP)
Identify what makes your business different and why a customer should choose your services over competitors. Use your checklist data to refine this proposition. For example, if all your competitors are pricier but have longer service hours, maybe your USP is affordable service within standard business hours.
SEO and Content Marketing Strategy
Use the information gathered about the keywords your competitors are ranking for to improve your own SEO. Create content around these keywords but ensure it is better in quality and more useful to the target audience.
Local Community Involvement
If your competitors are involved in local events or charities, consider doing the same. This isn’t about copying them but about becoming an active, positive presence in your community.
Pricing and Special Offers
Craft competitive pricing and special offers based on what’s already out there. If a competitor offers a 10% discount for first-time customers, offer a 15% discount to one-up them.
Conclusion
Analyzing your local competition is crucial in today’s highly competitive market. Using tools like Google My Business, SEMrush, and social media analytics, along with a comprehensive checklist, can provide you with the insights needed to craft a winning marketing strategy. Start your local market analysis today and ensure that your business stands out in a crowded marketplace.
Additional Resources
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