A key to success is making use of the information you learn from your competition to strengthen your own business. One of the key benefits of analyzing your competition is the fact that it allows you to focus on what makes your products or services unique.

What's more, it will allow you to identify opportunities for your business in the marketplace.

Make a list of your top competitors

Before you can start your analysis, you must first identify your top competitors. You want to make two lists: One list should consist of your direct competitors, and the other list should consist of indirect competitors.

Direct competitors are those competitors that your customers may choose when they decide to purchase a product or a service. Indirect competitors, on the other hand, are those competitors that try to win your customer's business indirectly. For example, a movie rental business is an indirect competitor with movie theaters.

Conduct a SWOT on your business and on the competition

SWOT which stands for Strengths, Weaknesses, Opportunities, and Threats analysis is often conducted by businesses that want to identify opportunities or to work on their business or marketing plans. By conducting a SWOT analysis, you'll be able to identify ways to use your strengths and improve upon your weaknesses.

You'll also be able to identify opportunities you have in the marketplace and threats to your current market position. Threats to your current market position might include new businesses entering the marketplace or current competitors introducing new products into the marketplace.

Be sure you conduct a SWOT as it's essential to identifying business opportunities in the marketplace.

Conduct a SWOT on your competitors' businesses

Conduct a SWOT analysis of your competition, particularly focusing on their strengths and weaknesses. Obviously, you cannot do as in-depth of an analysis as you can for your own business, but you will gain insight and better understand your competition through the process.

Find reviews of the competition

Find market reviews of the competition and analyze them to determine where your competition is positioned in the marketplace. You can generally find business reviews in magazines, newspapers, and on the internet, particularly blogs.

Use what you've learned

Used what you've learned from analyzing your competition to identify new opportunities in the marketplace and to tweak your current marketing strategy.