What is the Role of Competitor Analysis and Competitor Best Practices in the BFSI Sector?
Evolving industry, technology, and economies have given rise to unprecedented transformation within markets across the globe, and substantially increased competition, demand, and the need for unparalleled strategies. The BFSI industry has experienced a dramatic shift in operations, services, expectations, and strategies over the past decade, most commonly due to the incorporation of digitization and technology within the supply chain. As the industry continues to grow, competition becomes increasingly fierce, and companies require in-depth insight into competitors’ strategies, initiatives, and offerings, leading to the industry-wide utilization of competitor best practices. Companies and experts have started to leverage the data-driven, accurate, and efficacious practice of competitor analysis that provides businesses with real-time information regarding industry leaders’ and competitors’ differentiated offerings, market share, customer satisfaction, and plans. Maintaining a competitive edge requires well-informed decision-making, novel ideas, and unique approaches to changing market dynamics and evolving trends. Competitor best practices help companies efficiently and accurately evaluate industry players’ businesses, and develop alternative strategies to maintain a strategic advantage and competitive edge.
What are 5 Crucial Competitor Best Practices in the BFSI Industry?
Set Clear Objectives: Developing, planning, or executing a detailed analysis of competitors’ strategies is a complex, time-consuming, and data-driven process that requires professional insights, comprehensive information, and a clear strategic outline. When conducting a competitor analysis, companies must ensure their agenda, goals, and plans are determined, concise, and strategically sound. Having clear objectives can help choose the right competitors to analyze, provide a clearer insight into the evolving market, enable increased accuracy to the data collection process, and help procure the relevant data to support decision-making and further strategizing. This step can also help identify and leverage the right competitor best practices by providing professionals with clear insight into the goal and agenda of the analysis.
Identify Competitors: In a vast market, the number of competitors, industry leaders, and new market entries is continually fluctuating and changing, which can often lead companies to overlook crucial contributors to this dynamic. Conducting a competitor analysis requires clarity and accuracy, making it necessary for companies to clearly identify current and potential competitors in the market. These competitors can include, current industry leaders, key competitors in the same geographical regions, rapidly growing companies with a similar target market, and various others. If a company fails to identify all potential and current competitors, the data procured may be inaccurate, leading to major gaps in the analysis and inaccurate decision-making. Therefore, identifying all competitors is among the most crucial competitor best practices.
Determine Clear Metrics: An evolving market often experiences a range of varying, fluctuating, and changing dynamics that directly or indirectly affect business, strategies, decision-making, and competition. Developing a competitor analysis plan must account for all potential and current market dynamics, performance indicators, and metrics to ensure an accurate assessment of where competitors stand in comparison the business. Therefore, companies must clearly determine the key performance indicators, metrics, and other factors that will be used for evaluation, comparison, and analysis through the process. This competitor best practice also enables a clear and accurate insight into the key competitors or market players that can impact the relevant target market.
Avoid Limitation: A common error when conducting competitor analysis is limiting focus, maintaining a narrow perspective, and overlooking major contributors to the overall comparison. These limitations can include focusing on a limited number of competitors, failure to acknowledge a wide range of contributing factors within the market, and overlooking strategy, efficiency, profitability, and consumer satisfaction in addition to performance as comparative metrics. Limited insights within a competitor analysis can lead to inaccurate data, ineffective results, and compromised decision-making, potentially causing losses or wasted capital. Widening perspective and assessing a wide range of contributing factors are crucial competitor best practices.
Analyze and Leverage Data: Utilizing data can transform business for companies across industries, and data procured from a well-informed, and efficiently conducted competitor analysis can help business overcome various challenges and gain an unparalleled strategic edge. As the BFSI industry grows, companies are witnessing the increasing need for data-driven insights, in-depth information, and real-time data regarding competitors’ strategies and initiatives. The aforementioned competitor best practices help companies gain accurate data regarding their competitors, providing information required to make necessary changes to their operations. Leveraging this data can transform business, improve performance, overcome industry risks, and help maintain a strategic advantage.
As fintech and digitized systems take precedence over legacy banking systems, companies are pushed to evolve, change, and grow at a rapid pace to survive in the challenging market. These rapid transformations have led to various challenges, risks, and the need for major strategic adjustments and changes within the industry. An expanding financial services provider based in the US, sought to improve performance and gain a competitive edge as they shifted from old systems to technology and automation-based operations. To keep pace with the sudden surge in fintech companies, the financial services provider sought to partner with SpendEdge and leverage our expertise in competitor analysis and competitor best practices. Our experts worked closely with the company to identify and assess competitors, procure accurate and crucial data, and gain in-depth insight into their competitors’ operations, performance, strategies, and business plans. With this information available, stakeholders within the company made well-informed decisions, differentiated their offerings, and developed strategies to set their business apart from the competition, consequently establishing themselves as a rising industry leader.