If you learned that one of your distant competitors was making a sizable investment in public sector advertising, would you change your public sector sales strategy? If you knew that your largest competitor was doubling its media investment in a city where your market share was high, would that influence your spending decisions in that market? And if your closest competitor was allocating 80% of its advertising budget to social media advertising, would you rethink your own social media strategy and investments?
One of the services we provide to our customers is an analysis of precisely this information. It’s essential to understand what your competitors are doing, where they are spending and why. But don’t just take our word for it. Here’s what our clients have told us about why keeping your finger on the pulse of the competition really matters:
1. Help substantiate your argument for a larger media budget
As a former marketing director for a Fortune 500 company, I understand that every marketing dollar is coveted, with advocates across each industry and segment fighting for their fair share.
Advertising spending as a percentage of revenue is one of the benchmarks used for budget allocation. A spending analysis has enabled our clients to benchmark an average spending percentage across a set of competitors. If your company falls below the norm, it just might help you advocate for more dollars.
2. Make your media dollars go further
If you knew there was a decrease in print advertising in your market, would that help you negotiate better terms with media vendors?
Understanding trends and shifts in the media mix across the public sector has helped clients drive further cost savings. Improvements in technology are resulting in better targeting and increased ROI. It’s no surprise there’s been a big jump in online advertising as a result, but knowing the right vehicles that are producing the highest returns will enable your company to stretch its advertising dollars even further.
3. Protect yourself against the competition
One of our clients had a large contract coming up for renewal, with most of the business located in a major US city outside of Washington, D.C. Competitive spending research uncovered market based campaigns underway by several competitors.
By analyzing the messaging behind these campaigns, we went one step further and ensured that the client’s message would be differentiated, thus positioning them more favorably.
New faces creep into the public sector all the time and it’s often the big brands with deep pockets in the commercial segment. Whether you’re launching a new product or simply want to build your overall public sector share, knowing what the competitors are up to will help guide your own marketing strategy and decisions.
4. Identify emerging public sector contenders
By analyzing public sector media spend in comparison to a competitor’s national (i.e., overall) media spend, our clients have discovered insights about the degree of emphasis competitors are putting into the public sector.
For example, companies like IBM and Microsoft advertise across a breadth of markets – from consumer to business to government. By isolating public sector spending and comparing it to the company’s national advertising spending, we can make inferences about the degree of emphasis the company is making in the public sector. By analyzing this information over time, we can identify trends and further validate assumptions.
If we know that in 2010, 25% of Company A’s advertising investment targeted the public sector and in 2011, that jumped to 50%, it makes sense to expect to see more of Company A in the future. The implications of this go beyond advertising. Company A may be growing its sales force (a potential HR concern for companies dealing with high sales turnover), perhaps rolling out new offerings, new messaging, etc. – all important considerations when developing your own company’s go-to-market strategy.
5. Gain directional insights to guide your overall marketing strategy
And finally, being armed with competitive insight has helped guide the direction of our clients’ overall marketing and sales strategy. Competitive media analysis identifies trends in spending, media mix, and market based investments, while also identifying the specific properties (i.e. publications, online media outlets, etc.) each competitor is leveraging.
In a recent analysis, we confirmed that our client was the only one among the competitors analyzed that was notably absent from Washington, D.C.-based TV advertising. Complementary market research demonstrated that the client (who was also in the midst of a rebranding) was not top of mind among its target audience and was losing market share.
This doesn’t necessarily mean the company should add TV to its media mix, but a marketing director who understands the realities of the market and the competitive landscape, and considers these things in the context of the company’s product and branding strategy, is armed to make well informed decisions about her own company’s marketing strategy.