What is the purpose of conducting a competitor analysis?

Conducting a competitor analysis is primarily focused on evaluating the strengths and weaknesses of competitors within the market. This process allows businesses to understand the competitive landscape more clearly and identify potential opportunities and threats that may arise. By analyzing what competitors do well, a company can leverage those insights to enhance its own strategies, capitalize on gaps in the market, or improve product offerings. Additionally, understanding weaknesses in competitors can inform strategic decisions, such as how to differentiate a product or service. Therefore, the purpose of competitor analysis is fundamentally about gaining insights to inform strategic planning and positioning, making it essential for making informed marketing and business decisions.