What are the top mistakes to avoid when conducting a competitor analysis for a new store?

1 Not defining your objectives

Before you start analyzing your competitors, you need to have a clear idea of what you want to achieve and how you will measure your success. Do you want to identify their strengths and weaknesses, their pricing and promotion strategies, their customer segments and preferences, their market share and growth potential, or something else? Depending on your objectives, you will need different sources of information, methods of analysis, and criteria of evaluation. Without a clear direction, you might end up collecting irrelevant or incomplete data, or missing important insights.

2 Not choosing the right competitors

Another common mistake is to focus on the wrong competitors, either too many or too few, or those that are not relevant to your target market or product category. You don't need to analyze every single competitor in your industry, but you do need to select those that pose the most direct or indirect threat to your new store, or those that offer the most valuable lessons or opportunities for your business. To choose the right competitors, you need to consider factors such as their location, size, niche, differentiation, reputation, and customer loyalty.

3 Not using multiple sources of data

One of the challenges of competitor analysis is to gather reliable and up-to-date data on your competitors' performance, strategies, and customer feedback. Relying on only one source of data, such as their website, social media, or annual reports, can lead to biased or inaccurate conclusions. You need to use multiple sources of data, both primary and secondary, both quantitative and qualitative, and both internal and external, to get a comprehensive and balanced view of your competitors. For example, you can use surveys, interviews, mystery shopping, or online reviews to collect primary data, and industry reports, market research, media coverage, or benchmarking tools to collect secondary data.

4 Not analyzing your own store

A common mistake that many sales managers make is to focus too much on their competitors and forget about their own store. Competitor analysis is not only about finding out what your competitors are doing, but also about finding out how you compare to them and what you can do better. You need to analyze your own store's performance, strategies, and customer feedback, using the same sources and methods as you did for your competitors, and then compare the results. This will help you identify your competitive advantages and disadvantages, your gaps and opportunities, and your areas of improvement.

5 Not taking action based on the analysis

The final and most costly mistake is to conduct a competitor analysis and then do nothing with it. Competitor analysis is not a one-time activity, but a continuous process that should inform your sales decisions and actions. You need to use the insights and recommendations from your analysis to set your sales goals and objectives, to develop your sales strategies and tactics, to monitor your sales results and feedback, and to adjust your sales plans accordingly. You also need to update your competitor analysis regularly, as your competitors and the market conditions might change over time.

6 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?