Understand the fundamental purpose of performing an Amazon competitor analysis and know what to avoid in this article below!
Once setting up an Amazon business on the platform, you are essentially facing nearly 9.7 sellers worldwide, all of them actively trying to outperform your store. Thus, it is important that you know the basic information about your opponents so as to devise a suitable set of strategies.
Despite the undeniable importance of performing an Amazon competitor analysis, many retailers fail to do so properly. If you are among those, it is time you took a look at what might potentially go wrong and which mistakes to avoid when digging into your rivals’ activities.
What Is Amazon Competitor Analysis
A competitor analysis refers to the practice when you point out the most noticeable brands and stores that deliver the same line of products as yours.
From there, you get a chance to learn in depth about their sales, marketing tactics, products, pricing, and other factors that make or break their success. With these valuable insights, it is easier for you to identify their strengths and weaknesses, thus knowing what to apply to your business and what not.
Benefits Of Performing An Amazon Competitor Analysis
A competitor analysis is not solely bound for offline businesses only. All kinds of entrepreneurship can take advantage of this approach if the end goal is to maximize the chance of success.
The same goes for Amazon store owners. For various reasons below, you should always consider researching your rivals beforehand.
- It helps you reflect on your own business: Without another business to compare and contrast the key characteristics, you might end up getting stuck in an ivory tower thinking you have got everything right with your Amazon store.
The truth is, discovering the ins and outs of competitors gives you more perspectives regarding what you have done so far.
- It helps you understand the market: The presence of one company alone is not enough to create a market. It takes multiple businesses to create a dynamic environment in which good exchange takes place.
Hence, if you wish to know more about the latest trends and fads in your chosen field, what kind of products customers are interested in, or how different enterprises are trying to draw in more buyers, you have to spend time diving into their endeavors.
- It helps you identify the most effective practices: Sometimes, you do not have enough time or resources to test out all marketing strategies available. This is when “stalking” comes in handy.
Surely, some of the competitors out there have already adopted certain solutions that you intend on testing out. Instead of applying them immediately to your business, observe whether they have been beneficial for your competitors.
- It helps you set out realistic expectations: If you do not have any experience regarding selling on Amazon, it is easy to come up with unfeasible goals and targets. Not only are they difficult to achieve, but they also put unnecessary pressure on your company.
As a result, studying about other well-established firms would give you a rough idea of what a business is supposed to be like, saving you the hassle of not having benchmarks for reference.
Mistakes To Avoid When Performing An Amazon Competitor Analysis
1. Fail to determine who your competitors are
When confronted with too many sellers on the platform, knowing who you should be paying attention to can turn out to be quite a challenge. Therefore, always be on the outlook and closely examine businesses that share your industry, whether they are big or small.
Household names are undoubtedly a force to be reckoned with, but this does not mean you should ignore start-up or other newbie stores. With proper strategies, a tiny Amazon brand can grow substantially, taking up a larger share of the market and leave you aghast.
2. Fail to keep up with the movements of the industry
The fastest way to lose touch with how the market is moving, what the most viral trends are, or what sector is attracting customers the most is to stop following the news.
If you are in the technology field, you must be aware of what tech moguls like Apple or Samsung are doing. If you sell car supplies, you need to know about the activities of BorgWarner or Cooper Tire & Rubber.
Staying updated is what enables you to have a comprehensive grasp of the entire industry. Furthermore, it allows you to see the bigger picture, contemplate whether your business practices have fit in, and start preparing future plans ahead so as not to be left behind.
3. Fail to be consistent with the analysis
Given the growing speed of Amazon as the world’s most popular e-commerce platform, it should be no wonder that even a few days can bring about dramatic changes. Hence, you must regard competitor analysis as an ongoing process that takes place frequently, not a one-time task.
Of course, it is not necessary to check up on your rivals every single day. But make an attempt to review their performance at least once or twice a month. During peak shopping seasons like Easter or Christmas, you can even set aside time to have a look at their marketing strategies weekly.
This way, all of the most vital details concerning your competitors will not slip out of your hands, giving you an opportunity to find out their pros and cons.
Digging into the business of your competitors while maintaining the performance of your own is a struggle for those with limited experience in the field. If you find yourself swamped with difficulties trying to fulfill both of these roles, why not ask Olifant Digital for a helping hand?
Whether it is to seek out further information regarding your opponents, or learn more about the tips and tricks of Amazon management, the agency is more than willing to offer their support!