Chapter 5 – Analyzing Your Competition
Analyzing your competition is essential. Almost every successful business has competition, either direct or indirect. Some competitors are ruthless, so be very careful about examining the competitors in your chosen industry sector before entering it.
While it is true that you need to be aware of your competition, there is no need to feel intimidated by them.
Finding How Many Competitors There Are
The first step in analyzing your competition is to determine how many competitors you have. To do this, you can use Google Search to calculate which websites are targeting the same keywords as you.
If they're using the same keywords in their web page's URL, title, and anchor text, then you know they're serious competition. You can also use Google Search with your chosen key phrase in "quotes" to find out how many competing web pages there are.
You can also find out the number of backlinks to any website with resources like SEOmoz (https://moz.com), Blekko (https://blekko.com), or Majestic Site Explorer (https://majestic.com).
If you want to verify that a website is optimized for your keywords, you can use Google Search to uncover which web pages do have keywords in their page titles, anchor text links, or URL.
Imagine that you want to sell digital camera online, and you want to find out how much quality competition you’ll have in the market.
First, you can find out how many sites have “digital cameras” in the title of their web pages by typing “allintitle:digital cameras” into Google Search. You can also type "intitle:" for each of the keywords you've chosen. You want to avoid competing with websites that have more than 50 relevant keyword backlinks.
Your biggest competitors will be those who are at the top of the search engines for the top three most competitive keywords in your niche.
How difficult it will be to rank above your competitors will largely depend on the Page Rank (PR) of their websites and relevant web pages. If the average page rank of the top ten sites is below PR3, then it should take under three months to rank for this keyword.
Using SEO Quake (https://seoquake.com), note the average PR of the top ten websites for each keyword.
To analyze your competitors PR, you can make a spreadsheet, dividing it into two sheets; "Preliminary" and "Market Competition." Put the top ten keywords in the “Preliminary” sheet. On the “Market Competition” sheet, create ten columns; “Site1 PR,” “Site2 PR,” “Site3 PR,” etc. up to “Site10 PR.”
Take the best three to five unique search terms and put them in the “Market Competition” sheet.
Next, search Google using the top three keywords. Note the PR of the top ten websites for each of the three to five keywords. You should have 30 in total. Remove the highest and lowest "outliers" and then calculate the average PR in each row and overall.
You may also want to analyze the backlinks of your top competitors to see if they are optimizing their links for the same keywords as you are using.
You can determine the competitiveness of niche keywords by using a tool like Market Samurai (http://www.marketsamurai.com/) or Traffic Travis (https://traffictravis.com). After you’ve conducted as many searches as necessary, make a shortlist of all the keywords for which you think you can rank highly.
When you feel like you’ve found a niche to test and you know the niche’s subject matter well enough, you can create a short article, report, e-book, or white paper that offers some vital piece of information about the benefits of your new business idea, product, or service without compromising any of your intellectual property.
You can use this information as the "bait" to acquire a response from your target prospects.
For the last twenty years, internet marketers have proven that people respond best to “ethical bribes.” In other words, to get a potential customer's email address or personal details you have to offer them something in return.
That's why publishers of information products like to provide free giveaways in return for opt-in email subscriptions.
Fortunately, larger online brands have not picked up on this tactic yet. Therefore, for you to compete, it is highly recommended you use this strategy.
Look at the biggest brands in the niche you’re researching and see how they have evolved. You can find out how long they’ve been in business under their present domain name by visiting the “Whois” page of Network Solutions (https://networksolutions.com/whois) and find out how long ago the domain name was registered.
Then, using Time Machine (www.timemachine.com) or WayBack Machine (http://archive.org/web/web.php) to see how they have evolved, what they tried that didn’t work, and what they kept and where they invested their resources.
You also might want to see which competitors advertise using Pay-Per-Click advertising. If they’ve been using this form of advertising for a long time, then they are clearly making money.
If it’s a niche where the cost of advertising is high, then you can assume that they are making a good profit if they are still in business.
Consider Your Competition’s Pricing
If you uncover serious competition during your analysis, subscribe to their email list and see what they're doing. Are they selling higher priced products and services? Alternatively, is it all discounted?
If you uncover some higher prices, then you know that there is a market. If they’ve continued to offer high priced goods over the years, then you know for sure that the market is sustainable.
If the average price for a product in this niche provides a reasonable profit margin, then it will allow smaller players to enter the market and co-exist with established brands.
However, if the market competes on price, and the margins have been squeezed until they are paper thin, then you're better off looking into a less competitive, more profitable niche.
Also, if everyone is discounting each other in a tiny market, then you'll struggle to get off the ground. However, if there are several tiers of pricing, it's a lot easier for you to not just get into the niche, but to slowly power your way up the pricing levels as well, if you choose.
When it comes to search engine competition, generally, the lower number of competitors the better, However, if you come across a niche that has no competition, you should be suspicious that this could be a niche that no one has been able to make money.