Amazon Competitor Analysis: Step-By-Step Guide

Amazon competitor analysis involves scrutinizing the strategies, strengths, weaknesses, and market approaches of rival sellers or companies. This comprehensive evaluation helps you gain insights into market trends, identify profitable niches, and optimize your product listings to stand out in a crowded marketplace.

For online sellers, conducting an in-depth competitor analysis means staying informed about how similar products are positioned, priced, and promoted by other sellers.

You'll learn to track and anticipate competitor moves, enabling you to adjust your strategies in real-time.

With the wealth of data available through various analysis tools, you're equipped to make informed decisions that can lead to increased sales and a more substantial market presence.

Want to get better at spotting what makes your Amazon rivals tick and use it to boost your own sales? Read on to find out how!

What Is an Amazon Competitor Analysis?

Amazon Competitor Analysis is a strategic approach to understand your rivals on the world's largest online marketplace.

As you consider selling on Amazon, gauging the competitive landscape is crucial for carving out your market share among potent competitors. This form of analysis gives you a clear view of what other sellers in your niche are doing, what works for them, and where there might be opportunities for you to stand out.

The core components of a competitor analysis on Amazon include:

• Product Research: Examining similar products, their features, pricing, and market demand.

• Competitor Identification: Recognizing who your direct competitors are, and understanding their presence on the marketplace.

• Performance Tracking: Observing how competitors' products perform in terms of sales, customer reviews, and rankings.

• Strategic Actions: Analyzing competitors' marketing tactics, including advertising, promotional efforts, and social media usage.

The objective of this analysis isn't merely about comparison; it's about using data-driven insights to inform your business decisions.

By understanding your competitors' strengths and weaknesses, you can develop strategies to optimize your own Amazon listings, tailor your inventory, price competitively, and hone your marketing tactics.

Remember, in the competitive analysis you're not just observing, you're also looking for gaps and opportunities to differentiate your brand and products on Amazon.

Why Analyze Competition on Amazon?

When operating a business on Amazon, analyzing your competition is critical to your success. Understanding the competitive landscape allows you to craft a marketing strategy that differentiates your products and optimizes your presence.

• Identify Strengths and Weaknesses: You can learn much from competitors on Amazon by examining their strengths and weaknesses. This insight enables you to improve your own offerings and avoid mistakes they've made.
  
  

• Refine Marketing Strategy: A thorough competitor analysis informs your marketing efforts, helping you to find opportunities and create messaging that highlights your unique selling points.
  
  

• Enhance Business Performance: By understanding what others are doing well, you can implement best practices into your business, ensuring you maintain a competitive edge.
  
  

Key Metrics to Focus On:

By actively assessing your competitors on Amazon, you position your business advantageously, make informed decisions for product development, and shape your marketing strategy to cater to consumer needs and preferences.

How To Conduct an Amazon Competitor Analysis

To effectively compete on Amazon, it's crucial for you to understand the competitive landscape, identify trends, and gather actionable insights that can inform your strategies.

1. Define Your Market

Before you can analyze your competitors, you must clearly define your market. This involves understanding the specific niche or category you're targeting.

Look at the market share and trends to identify who the top players are and what is driving their success.

Also read our guide: Amazon Market Research for 2024: New Strategies for Success

2. Identify the Right Shopper Intent

Determining the right keywords is essential as they reflect shopper intent.

You should analyze search volume and customer inquiries to fine-tune your listings and ensure they align with what potential customers are looking for.

This alignment can significantly impact your visibility on Amazon.

3. Using Cutting-Edge Advertising Tools

Leverage AI and technology to make use of advanced advertising tools.

Automation and data-driven insights can help optimize your marketing efforts, allowing you to target customers more effectively.

Keep an eye on performance data to adjust your strategies as needed.

4. Estimate Sales Volume

To gauge the health and potential of your product, estimate the sales volume of your competitors.

This estimation gives an idea of demand and revenue potential.

Tools like AMZ Scout provide valuable data on product research and sales tracking, enabling you to make informed decisions.

5. Determine Market Size

Understanding the market size helps you set realistic sales goals and expectations.

Assess competitor stock sizes to estimate the overall demand within your niche.

This assessment, along with market share analysis, offers insights into how much room there is for growth and how to position your products competitively.

How To Find and Define Competitors on Amazon

To excel on Amazon, you need to understand your competitors by analyzing their keywords, listings, pricing, sales, and marketing strategies. This will allow you to optimize your products for better visibility and increased sales.

Steps to Identify Competitors

Product Category Analysis

Begin by analyzing the product categories that align with your offerings. Then, look at the top-selling products and brands that directly compete with yours.

Keyword Research
Begin by conducting keyword research to discover which keywords your competitors are ranking for in search results.

Focus on keywords that are relevant to your products and have high search volumes. Thoroughly examine competitors' product listings including:

• Product Images: Quality and quantity of images.

• Product Title: Use of keywords to attract potential customers.

• Bullet Points: Clarity and detail in explaining features.

• Product Description: How the product solves customer problems.

• Customer Reviews: Quality and sentiment of product reviews. Identify which competitors rank highly for these keywords.

Related reads: How to Find Competitors' Keywords on Amazon and Amazon Product Listing/Title Optimization: 8 Secret Strategies

Monitor Competitor Pricing

Effective pricing strategy is critical on Amazon. Monitor your competitors' pricing to understand the market.

Key elements to consider in competitor prices:

• Pricing Changes: Regular checks to track any fluctuations.

• Discounts/Promotions: Note frequent promotions and their impact on sales.

Adapting your prices competitively can improve your market share and positioning.

How to Define Competitors:

• Direct Competitors: Sellers who offer the same or similar products as yours. Their business strategy, pricing, and customer base may closely resemble your own.

• Indirect Competitors: These are businesses that might not sell the exact product but could satisfy the same customer needs.

Track Monthly Sales

Estimate monthly sales volume of competitors to gauge demand for their products. Sales data can indicate market trends and product popularity.

Use tools that estimate sales based on:

• Best Seller Rank: A lower rank typically signifies higher sales.

• Sales Data: Historical trends that can predict future performance.

Explore Marketing Techniques

Evaluate the marketing efforts of competitors to understand their strategies in:

• Promotion: How competitors run Amazon deals or discounts.

• Marketing Tactics: Observe off-Amazon tactics such as social media advertising.

Insights gained from competitors' marketing can help refine your own marketing tactics.

Adapt successful elements into your strategy to potentially increase your product's appeal.

Creating a Competitor List:

• Start by listing down businesses that frequently appear in your product search results.

• Prioritize the list based on how closely their offerings match yours.

Evaluating the Competition

• Assess the strengths and weaknesses of these competitors to find gaps in their strategies.

• This will allow you to highlight your unique selling points and capture market share from these sellers.

Conclusion

If you want to do well selling on Amazon, it's super important to see what your competitors are up to. By checking out their tactics, you can make your products look better, set the right prices, and get your marketing just right to really grab customers' attention. Instead of just being part of the crowd, you can stand out and do great.

When you really get to know what your competition is doing, that's when you can start to do even better. Use all the information you can get to make your Amazon shop the best it can be. Even though there are lots of sellers out there, you can still be a star with the right tips and tricks. 

Once you've defined the competition, take your Amazon sales to the next level with PPC automation tools like Scale Insights. Their advanced features automate campaign management, optimize bids, and improve ad performance—saving you time and increasing profitability. Check out Scale Insights to elevate your advertising strategy.

Frequently Asked Questions

How do you monitor competitors' activity?

To monitor your competitors' activity on Amazon, use tools like JungleScout, AMZ Tracker or Helium10. These tools can track product rankings, pricing changes, and review rates. You can also manually check their product listings for changes in keywords, images, and descriptions. 

How do you know if a product is selling well on Amazon?

You can gauge if a product is selling well on Amazon by looking at its Best Seller Rank (BSR) within its category. A lower BSR indicates higher sales. Additionally, a large number of positive reviews and a consistent flow of recent feedback can signal a well-performing product. Sales estimation tools like Jungle Scout or Viral Launch can also provide approximate sales volumes based on BSR.

How long should competitor analysis take?

The length of time for competitor analysis can vary based on the depth of information you seek and the number of competitors being monitored. An initial thorough analysis could take several days to a few weeks. However, once established, competitor monitoring should be an ongoing process with regular check-ins, which might take a few hours each week, ensuring you stay updated with market dynamics.

Can SWOT analysis be used for competitors on Amazon?

Yes, SWOT analysis, which assesses Strengths, Weaknesses, Opportunities, and Threats, can be applied to competitors on Amazon. This strategic planning technique helps to understand a competitor's position in the marketplace, identify areas where your business can capitalize, and anticipate challenges.

Analyzing a competitor's SWOT can reveal insights on how to differentiate your product or exploit gaps in their business strategy.