The purpose of a Competitive Audit is to better understand how your offering compares against available alternatives. Marketers regularly conduct audits to get a better handle on what competitors are doing to inform their own marketing plans. There are many different types of audits. Feature-based audits are binary and help marketers understand if a competitor offers something. Approach-based audits are descriptive and help marketers understand how a competitor offers something. Performance-based audits are evaluative and help marketers to understand how effective a competitor is at something. It is important to first identify how your competitive audit will be used before selecting the appropriate type and beginning your work.
What do competitors currently offer and how do we compare?
- Start by determining what exactly you will be using the completed audit for. What questions do you have, or what decisions do you need help making? Select the type and format of your audit accordingly.
- Identify the relevant competitors to include in your audit. While most audits are focused on direct competitors, consider including emerging or adjacent competitors for a different, wider perspective.
- Identify the attributes for your audit. These attributes need to cover the scope and purpose of your audit, and be mutually exclusive from each other. Make sure you are actually able to track or measure each one.
- Conduct your research for one of your competitors. What did you learn as a result of the process? Review your attributes to see if you need to make any changes before you complete the rest of your audit.
- Once completed, review the results of your audit. Identify the key findings and implications from your research. Capture if there any changes you would make to the audit or process the next time it is conducted.
- Data collection is time-consuming, so make sure your team is aligned on your approach before starting.
- Consider if you will be updating your audit over time, and if you are capturing everything now that you will need.
- If you are conducting a performance-based audit, make scoring criteria as clear and objective as possible.
Porter, M. “Competitive Strategy: Techniques for Analyzing Industries and Competitors”, Free Press, 1980