Ever since its early beginnings, Avis, the car rental company, was always second to Hertz. In 1963, its agency Doyle Dane Bernbach decided to capitalize on Avis being second and came out with the slogan, “When you’re only number two, you try harder.” Avis had lost $3.2 million the year before the campaign but within a year, earned $1.2 million, its first profit in a decade. Market share differences between the two between 1963 and 1966 went from 61-29 to 49-36 as a result of the campaign.
What’s a Brand to Do?
Brands that trail their competitors also have some options. However, unlike Avis’ success, turnabout isn’t likely to occur overnight. It will also require a team effort.
Similar to a SWOT analysis, a competitor analysis is one performed on each competitor. So, in addition to SWOT, look at and assess the following. What keywords are competitors ranking for? What does their backlink strategy appear to be? What trending keywords are they leveraging? Look at and analyze a top competitor’s SERPs to understand why they’re trending and popular with consumers.
Also conduct a PEST analysis of the brand and do the same on top competitors. PEST stands for political, economic, social and technological. This is valuable in considering other factors that affect brand profitability.
For political reasons, ask whether there are any new factors or changes that could affect the brand. One of the latest is consumer data and privacy. The economic aspect of PEST should consider exchange rates if the brand is marketed globally. Today’s coronavirus scare may affect that and the consequences of a possible recession should also be factored in.
Among the social aspects to be weighed are such things as demographics, age distribution, trends in lifestyle and cultural attitudes. For brands marketing to millennials and Gen Z, age distribution can be important since they will collectively soon represent more than half of all consumers.
Technology speaks for itself. Assess marketing needs and keep abreast of new developments that may save time and energy in tracking, forecasting and analyzing data. With PEST, it’s not just important to take a look internally at the brand. It’s also valuable to see what the competition is doing.
Honestly ask and assess how the brand compares with competitors. Conduct an impartial -in-house kind of consumer report. Are there elements or features that make the competitor’s brand more popular and appealing?
What social media channels does the competition use? What are they employing – text, video, pictures, etc? How often do they post on each? Based on comments, what do the demographics of the competitors appear to look like? If it hasn’t already happened, sign up to receive competitor notices, invitations and offers to keep tabs on their marketing activities.
In considering the brand’s customers, how do prices compare with competitors? What income bracket best represents them and does the brand’s pricing align with that?
After gathering all this information, gather the marketing team around. Discuss and determine what the competitor’s marketing strategy looks like and what changes and improvements can be made to the brand to do the same kind of turnaround like Avis.