Category: C-Suite

How Businesses Can Use AI for Competitor Analysis

In the highly competitive landscape of modern business, staying ahead of your competition is more critical than ever, especially for small businesses. While traditional methods of competitive analysis have their merits, Artificial Intelligence (AI) is revolutionizing the way we understand our market rivals. This article will walk you through actionable examples of how business can us AI fo competitor analysis.

1. Price Monitoring and Optimization

Actionable Example: Consider a small fictional online bookstore named “Readers’ Paradise.” Using AI-powered tools like Prisync or Competera, the store can continuously monitor the pricing strategies of competitors. When a major online retailer offers a discount on a best-selling novel, AI can alert “Readers’ Paradise” to adjust their price accordingly. This dynamic pricing strategy ensures they remain competitive without compromising profitability.

2. Customer Reviews and Sentiment Analysis

Actionable Example: A local café, “Morning Bliss,” can utilize AI tools like ReviewTrackers to analyze customer reviews of competitors on platforms like Yelp and Google My Business. By understanding what customers appreciate or complain about, “Morning Bliss” can tailor its services, offering unique selling points that distinguish it from competitors.

3. Social Media Strategy

Actionable Example: Small businesses can use AI platforms like Hootsuite Insights to analyze competitors’ social media activity. For instance, a boutique fashion store can track which type of content generates the most engagement for similar businesses. Armed with this information, they can create more compelling social media campaigns.

4. SEO and Content Strategy

Actionable Example: SEO tools like SEMrush and Ahrefs offer AI-driven insights into competitors’ keyword strategies. A small pet supplies shop can use these insights to identify gaps in their own content. If competitors are ranking high for “organic dog food,” but your site lacks content in that area, it’s a clear signal to develop content around that keyword.

5. Product Development

Actionable Example: AI can also help in product innovation. Suppose you run a small tech gadget shop. By using AI tools like Crimson Hexagon, you can analyze public opinion and discussions about competing products. Discovering that customers wish for a longer battery life in a particular gadget could inspire you to source or create a similar product with an extended battery life.

6. Identifying Market Trends

Actionable Example: With tools like Google Trends, small businesses can use AI to analyze search data and predict market trends. A small cycling gear shop, for example, can identify when interest in cycling peaks, aligning their inventory and marketing strategy accordingly.

Conclusion

The power of AI in competitive analysis is not just for corporate giants; it’s for businesses of all sizes. With these actionable examples, small businesses can deploy AI tools to stay ahead of the curve, offering unparalleled customer experiences and products that set them apart from competitors.

By adopting AI-driven competitive analysis, small businesses can transform raw data into strategic insights, paving the way for informed decisions and sustainable growth.

Using ChatGPT for pre-mortems

A pre-mortem is a powerful business technique where you take a leap into a future where your project has failed and you discuss where it went wrong. It helps teams identify potential issues and develop solutions before the project has launched. It involves critical thinking and some degree of creativity. But it can also generate some insights that in extreme cases can stop you from working on your project any further. Using ChatGPT for pre-mortems is an very low cost method of doing this without the need to convene any management meetings

Using ChatGPT for Pre-mortems

ChatGPT-4, the latest iteration (as of April 2023) of OpenAI’s powerful language model, is an invaluable business asset that can help reduce project management disasters. By using the right prompts, project teams can simulate failures before a project has started and use the analysis to identify and proactively mitigate potential risks. This method not only saves time and resources but also fosters a wider business culture of proactive problem solving.

Example Pre-mortem Prompt 1 – Product launch

“Assume that our new product launch has been a failure. The product was designed to do x and we developed it because we thought it would sell profitably in the y market. List the top 5 reasons why this might have occurred and suggest ways to address each of these issues.”

Why this works: This prompt encourages ChatGPT-4 to analyze and generate potential reasons for failure, helping the team identify potential risks and their corresponding solutions. By addressing the top 5 reasons, the model provides a focused analysis, ensuring that the most critical aspects are considered. Additionally, the prompt asks for ways to address each issue, allowing teams to develop preemptive strategies for success.

You can also ask ChatGPT to rank the reasons for failure in terms of likelihood, cost impact and so on. Use your description of what the product does to give ChatGPT as much background information as you can. Ask it follow up questions too.

Example Pre-mortem Prompt 2 – Marketing campaign

Prompt: “Imagine our marketing campaign for our new product x failed to achieve the goals we set in terms of sales and customer engagement. Our marketing campaign consisted of social media promotion, geo-targeted Google Ads and local mailshots. Describe four possible flaws in our campaign strategy and provide recommendations on how to improve each of them.”

Why it works: This prompt targets a specific area of the project, the marketing campaign, and directs ChatGPT-4 to evaluate potential shortcomings. Asking for a specific number of possible flaws helps ChatGPT to provide ran analysis that will have four separate elements which you can then rank. The specific request for recommendations for improvement will accelerate the process of finding solutions and help ideation.

Both these examples focus on product launches which is an important business process but there are many other areas where pre-mortems are helpful. Let’s look at one about recruitment.

Example Pre-mortem 3 – Recruitment

Prompt: “Our recent hiring process resulted in a high employee turnover rate within the first six months. Identify four factors that might have contributed to this outcome and suggest improvements for each factor in our hiring process.”

Why it works: This prompt focuses in on the hiring process and its potential impact on employee retention. By asking ChatGPT-4 to explore four contributing factors, the model is encouraged to delve into various aspects of the hiring process that might have led to a high turnover rate. This comprehensive examination helps the HR team pinpoint areas in need of improvement. By requesting suggestions for each factor, the team can develop a more effective hiring strategy to ensure they attract and retain the right talent.

The cost of doing pre-mortems

A typical business pre-mortem involves a meeting of your project team and a lot of discussion which takes time and therefore costs money. Of course, it can also save a lot of money down the line if it results in actionable outcomes that boost the chances of the project’s success. Using ChatGPT and similar tools to do a pre-mortem takes a few minutes and whilst not necessarily as effective as a full-blown pre-mortem management meeting, it can deliver results extremely cheaply. These results may deliver actionable outcomes on their own but just as significantly, they can be used as a business accelerant by acting as briefing notes for your own pre-mortem. Don’t forget too that you can ask ChatGPT to regenerate its response to come up with more ideas and that you can ask it to explain more about any aspects of its answers.

Conclusion

By integrating ChatGPT-4 into pre-mortem exercises, businesses can unlock innovative and efficient ways to identify and address potential project failures for negligible cost. By formulating targeted and focused prompts, teams can extract valuable and actionable insights from the AI, which enables them to make better decisions and reduce implementation risks.

Pre-mortem action point

Managers should do pre-mortems using AI tools like ChatGPT-4 as a matter of habit. Using ChatGPT for pre-mortems should be as habitualised as using Google for search used to be.