Competitor analysis in the Saudi market

The process of competitor analysis in the Saudi market goes beyond simply knowing the names of competing companies; it is a systematic process aimed at deconstructing their strategies, understanding their motivations, and anticipating their future moves. This analysis is not a one-time task performed when preparing a feasibility study, but rather an ongoing activity that must be an integral part of the company's culture to monitor the pulse of the market and adapt to its variables. By understanding what competitors are doing right and where they are going wrong, a company can identify market gaps, develop unique value propositions, and build a sustainable competitive advantage that ensures growth and prosperity in this promising and challenging market.

Competitor Analysis in the Saudi Market

The process of competitor analysis in the Saudi market is considered a strategic process aimed at achieving a set of critical objectives that form the foundation for building a successful business strategy:

• This process helps in clearly and accurately identifying who the real competitors in the market are, whether they are direct competitors offering the same product or indirect competitors meeting the same customer need.

• It works to uncover the strengths that competitors possess, which the company must counter or emulate, and the weaknesses that can be exploited as opportunities to penetrate the market.

• It enables the company to understand the pricing strategies followed in the market and determine whether it is better to compete on price or differentiate the product to offer higher value.

• It contributes to anticipating the potential reactions of competitors to any new move the company makes, such as launching a new product, a major marketing campaign, or a change in prices.

• It provides valuable inputs for developing innovative products and services that meet customer needs better than what current competitors offer, thereby creating a strong competitive advantage.

Steps for Conducting Competitor Analysis in the Saudi Market

To ensure accurate and actionable results, competitor analysis in the Saudi market must follow systematic and organized steps that cover all aspects of competition:

• The process begins by identifying a comprehensive list of key competitors in the Saudi market and classifying them into different categories, such as market leaders, niche competitors, and new entrants.

• Detailed information about each competitor is collected from various reliable sources, including their websites, annual reports, social media pages, press articles, and market reports.

• The products and services offered by each competitor are analyzed in detail in terms of quality, features, design, packaging, and pricing to evaluate the value propositions they offer to customers.

• The marketing and promotional strategies adopted by competitors are studied, including the distribution channels they use, their advertising campaigns, and their activity in digital marketing and content.

• All this data is aggregated and analyzed using tools such as the Competitive Profile Matrix (CPM) and SWOT analysis for each competitor to arrive at clear strategic conclusions and recommendations.

Analysis of Competing Products and Services in Saudi Arabia

Examining competitors' products and services is an essential part of competitor analysis in the Saudi market, as it reveals many secrets of their strategies:

• Competitors' products are purchased or their services are experienced directly (mystery shopping) to evaluate their actual quality and the user experience from start to finish.

• The product portfolio offered by each competitor is analyzed to determine the depth and diversity of their offerings and their ability to meet the needs of different customer segments.

• The pricing policies followed for each product are studied individually and compared with the perceived value the product offers to determine if the price is justified in the eyes of the customer.

• The quality of customer service, technical support, and return and exchange policies offered by competitors are evaluated, as they are considered an integral part of the total product offering.

• Any new products or updates launched by competitors are continuously monitored to understand innovation trends in the market and anticipate the future steps of competitors.

Marketing and Promotional Strategies of Saudi Competitors

Understanding how competitors reach their customers is key to building an effective marketing strategy, which is a major focus of competitor analysis in the Saudi market:

• The advertising channels heavily used by competitors are analyzed, whether they are traditional channels like television and outdoor advertising or digital channels like Google Ads and social media.

• The content published by competitors on their blogs and social platforms is studied to analyze the marketing messages they focus on and the brand tone they use.

• The strength of their presence on social media is evaluated by analyzing the number of followers, engagement rates, and the quality of comments and reviews from customers.

• It is determined whether competitors rely on loyalty programs, frequent promotional offers, or partnerships with influencers to retain their customers and attract new ones.

• Their estimated marketing budgets are analyzed based on the volume and intensity of their advertising campaigns to form an idea of how much they invest in this important aspect of the business.

The Impact of Vision 2030 on the Competitive Landscape Saudi Arabia

Vision 2030 has led to a radical change in the business environment, and any competitor analysis in the Saudi market must take these shifts into account:

• The Vision has contributed to opening entirely new sectors for competition, such as the entertainment, tourism, and cinema sectors, creating brand-new players that did not exist a few years ago.

• The Vision has encouraged more foreign companies to enter the Saudi market, either directly or through partnerships with local companies, which has increased the intensity of competition in various sectors.

• The privatization programs launched by the Vision have led to the transformation of some former government entities into commercial companies competing in the open market, which has changed the nature of competition in sectors such as health and education.

• The Vision has focused on supporting local content and small and medium-sized enterprises, leading to the emergence of a new generation of innovative local competitors who challenge major companies with their agility and speed.

• The social transformations that accompanied the Vision, such as increased women's participation, have changed consumption patterns and created new opportunities and new competitors in sectors such as fashion, beauty, and fitness.

Analysis of Digital Competitors in the Saudi Market

With the increasing reliance on the internet, digital competitor analysis has become an integral part of any competitor analysis in the Saudi market:

• Specialized tools are used to analyze the keywords that competitors target in search engines and to know their ranking in Google search results.

• The performance of their websites is analyzed in terms of loading speed, user experience, and mobile compatibility, which are critical factors in the Saudi market.

• Their paid advertising campaigns on Google and social media platforms are monitored to analyze the texts, images, and target audience they focus on.

• Their content strategy is analyzed to see which types of articles, videos, or infographics receive the most interaction and engagement from the audience.

• Their use of e-commerce and the online shopping experience they offer is studied, from product display to the payment and delivery process.

Leveraging Other Gulf Studies in Analysis

Looking at neighboring markets can provide valuable insights when conducting a competitor analysis in the Saudi market, as many major companies operate on a regional scale:

• The process of preparing investment studies in the UAE can reveal the strategies of competitors who use Dubai as a regional hub for their operations and target the Saudi market from there.

• Preparing financial studies in the UAE can shed light on the financial structures and costs faced by competitors in a nearby operating environment, which helps in estimating their profitability.

• Preparing marketing studies in Saudi Arabia itself might reveal regional competitors that were not previously considered and who have ambitious expansion plans in the Kingdom.

• Feasibility study services in the Sultanate of Oman or other Gulf markets can offer innovative business models for local competitors who have succeeded in similar environments, and their strategies can be adapted.

• Comparing with competitors in other markets helps in understanding regional standards for quality, service, and price, and determining whether the company offers a competitive proposition at the regional level.

Tools and Techniques Used in Competitor Analysis

The effectiveness of competitor analysis in the Saudi market depends on using a variety of modern tools and techniques to collect and analyze data:

• Web analytics tools such as Google Analytics and SimilarWeb are used to understand the sources of traffic to competitors' websites and visitor behavior within the site.

• Search Engine Optimization (SEO) tools such as Ahrefs and SEMrush are relied upon to analyze competitors' keyword strategies and backlinks.

• Social media monitoring tools such as Brand24 and Talkwalker are used to track what is being said about competitors and their brands online.

• Paid market reports from global research firms such as Euromonitor and Nielsen are relied upon, which provide in-depth data and analysis on various sectors in the Saudi market.

• Surveys and focus groups are conducted with samples of customers to obtain direct insights into their perceptions of competing brands.

Challenges of Competitor Analysis in the Saudi Market and How to Overcome Them

Despite its importance, competitor analysis in the Saudi market faces some challenges that analysts must be aware of:

• One challenge is the scarcity of publicly available information about some private or family-owned companies not listed on the stock market, which requires relying on estimates and indirect sources.

• Some available data may be outdated or inaccurate due to the speed of market changes, which requires constant updating of information and verification from multiple sources.

• The language and cultural barrier poses a challenge for foreign analysts in understanding the nuances of marketing messages and local consumer behavior, which necessitates the use of local experts.

• It can be difficult to obtain accurate information about the actual pricing strategies of competitors, especially in B2B sectors that rely on customized price quotes.

• To overcome these challenges, a multi-source approach must be adopted, avoiding reliance on a single source of information, using qualitative analysis alongside quantitative analysis, and updating data periodically and regularly.

Competitor analysis in the Saudi market is no longer a luxury or an option, but an extreme strategic necessity for anyone seeking to achieve success in this pivotal market. It provides the insight needed to chart a clear path, avoid costly mistakes, and build flexible strategies capable of adapting to a market that never stops evolving. Companies that invest in this process systematically and continuously are the ones that will be able to seize the immense opportunities offered by the Kingdom of Saudi Saudi Arabia today and in the future.