Seven questions you must answer to avoid leaving money on the table
How an online market analysis can reveal friendly competitors, potential marketing partners, and new business opportunities…
In traditional bricks and mortar businesses, there is a theory of management called MBWA. It stands for “management by walking around.”
It means getting out of the office and out into the real world. Talking to people. Experiencing your business first-hand, much like your customer would.
Of equal importance, especially for online businesses, is “marketing by walking around.” That means doing a thorough exploration of the “neighborhood” in which you operate to determine competitors, potential marketing partners, and new business opportunities.
At a recent meeting with 21 CEOs who constitute the MPA-IMAG (Independent Magazine Group), I spent an hour and 20 minutes demonstrating an exercise we call the “Mequoda Online Market Audit”.
Current IMAG Chair and long-time Mequoda Advisory Board Member Bryan Welch of Ogden Publications, finally called a halt, or I honestly think we would have continued to explore this topic for another two hours.
What’s so fascinating about an online market analysis?
Well, done right, it reveals some not-so-obvious facts about the competitive landscape — exposing both weaknesses and undeveloped opportunities. Understanding a Mequoda Online Marketing Audit can translate into serious profits.
So, can you answer these seven questions about the online market in which you operate and compete?
- How big is your market?
- How fast is your market growing?
- What is the seasonality in your market?
- What keywords does your market use?
- Who are your top competitors?
- Who are your potential content partners?
- Who are your potential marketing partners?
Here’s how we help Mequoda consulting clients find the answers.
A Mequoda Online Market Audit begins with a quest for the leading keywords associated with your website.
Do you know the 10 keyword phrases that best define your overall content? How do you answer if someone asks you what your site it about?
Well, if you ask that question of the Motley Fool, at www.fool.com, according to the site navigation, the answer is investing, retirement and personal finance. Those are three of the über words they would use to describe their site.
If you ask the folks at Better Homes & Gardens, at www.bhg.com, they might say decorating, gardening and crafts.
What are the über words or primary search terms around which your website should be organized?
We limit the list to 10 primary search terms because the next step is to search every term and record the top 30 websites that Google returns for each. These are the websites that are most authoritative on the particular keyword phrase.
There’s nothing automated about this procedure; it’s all done manually.
We create a competitive universe by cutting and pasting these URLs into an Excel spreadsheet. After we complete this exercise for each of the 10 keyword phrases, we have a list of 300 websites (or fewer, if there are duplicates).
We track the keyword phrases and their ranks, and cross-reference them at Compete.com, a website that enables open access to audience measurement metrics for the top one million websites in the U.S.
By extracting the current and historic visitor counts from Compete.com, we have a year over year change for each URL.
Next, we identify each URL by website archetype (Which are retail stores? Which are periodical websites?) and by revenue model (user-driven, sponsor-driven, or a hybrid).
An analysis of the resulting database will determine the total number of unique visitors for this group of leading websites that constitute an online “neighborhood.”
Now we can determine the size, growth rate and seasonality of the market. We can sort the data to determine what percentage of traffic is going to each of the website archetypes. That tells us if this market is dominated by directories, classified, or periodical websites.
Additionally, we can know which content models are dominating the market, and which are missing. Does that represent an opportunity? Is our neighborhood without a content model that we should build?
We can also analyze all of the revenue models to understand whether, in this market, most of the money is coming from users, or from sponsors, or whether this is a mixed business model market.
How many websites show up more than once? How diverse is the neighborhood? How concentrated?
Our analysis of these factors, and others, helps us determine the best Internet business models and strategies for a given online market, and answer even more questions.
What are the general parameters of the neighborhood? Who are the potential partners for content syndication? Who are the potential partners for marketing?
Competitors can be collaborators.
At the end of the day, our Mequoda Online Market Analysis enables us to know how to choose or change our website business model, plus which competitors represent potential marketing or content-sharing partnerships.
The takeaway: Don’t underestimate the value of competitive intelligence.
How well do you know your online neighborhood?
Does your online publishing enterprise need a Mequoda Online Market Analysis? Join us at the next Mequoda Summit and we’ll teach you how it’s done.
Discover more about how to Make Money Online in a Web 2.0 World at the Mequoda Summit and Internet Marketing Conference.