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Market & Competitor Analysis

Competitor Financial Performance Analysis

use this prompt when:

  • You need to assess your brand’s financial health compared to key competitors
  • You’re preparing for a strategic planning session or board meeting that requires competitive context
  • Your market share or profit margins have changed significantly, and you need to understand why
  • You’re considering a shift in pricing strategy or investment priorities
  • You’re evaluating the financial impact of recent marketing initiatives relative to competitors

The prompt

Analyze the financial performance of <business> compared to <competitor names> in the <industry/market> over the past <timeframe>. Compare key financial metrics including revenue growth, profitability margins, customer acquisition costs, lifetime value ratios, operational efficiency, and investment patterns. Identify financial strengths and vulnerabilities in our business model, with specific recommendations to improve our financial performance in the areas of <financial performance areas> to meet our objectives of <financial objectives>.

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How to customize

Competitor Financial Performance Analysis
Variables
Description
Variables
business
Description
Enter your brand or company name that will be the focus of the analysis.
Variables
competitor names
Description
List 2-5 direct competitors whose financial performance you want to benchmark against.
Variables
industry/market
Description
Specify your industry segment or specific market category (e.g., "premium skincare," "direct-to-consumer apparel").
Variables
timeframe
Description
Define the period for analysis (e.g., "past 2 years," "last 4 quarters").
Variables
financial performance areas
Description
Identify specific financial aspects you want to improve (e.g., "marketing ROI," "inventory management," "subscription revenue").
Variables
financial objectives
Description
State your specific financial goals (e.g., "increasing gross margin by 5%," "reducing CAC by 15%," "improving cash flow").

Example Output

Competitive Financial Performance Analysis: GLOW Skincare

 

Executive Summary

GLOW Skincare demonstrates strong revenue growth (26% YOY) compared to competitors in the clean beauty market, outperforming the category average (18%). However, your profitability metrics lag behind key competitors, particularly in gross margin (42% vs. industry leader Beautify’s 58%) and operating margin (11% vs. category average 15%).

 

Key Financial Metrics Comparison

 

Revenue Growth (2-Year CAGR)

  • GLOW Skincare: 26%
  • Beautify: 31%
  • PureSkin: 22%
  • NaturalGlow: 16%
  • Category Average: 18%

 

Profitability Metrics

  • Gross Margin:
    • GLOW Skincare: 42%
    • Beautify: 58%
    • PureSkin: 48%
    • NaturalGlow: 44%
    • Category Average: 47%
  • Operating Margin:
    • GLOW Skincare: 11%
    • Beautify: 19%
    • PureSkin: 14%
    • NaturalGlow: 12%
    • Category Average: 15%

 

Customer Economics

  • Customer Acquisition Cost (CAC):
    • GLOW Skincare: $48
    • Beautify: $62
    • PureSkin: $41
    • NaturalGlow: $36
    • Category Average: $47
  • Customer Lifetime Value (LTV):
    • GLOW Skincare: $210
    • Beautify: $320
    • PureSkin: $180
    • NaturalGlow: $145
    • Category Average: $210
  • LTV
     Ratio:

    • GLOW Skincare: 4.4:1
    • Beautify: 5.2:1
    • PureSkin: 4.4:1
    • NaturalGlow: 4.0:1
    • Category Average: 4.5:1

 

Operational Metrics

  • Inventory Turnover:
    • GLOW Skincare: 4.2x
    • Beautify: 6.1x
    • PureSkin: 4.8x
    • NaturalGlow: 3.9x
    • Category Average: 4.7x
  • Marketing Efficiency Ratio (Revenue/Marketing Spend):
    • GLOW Skincare: 3.2:1
    • Beautify: 4.1:1
    • PureSkin: 2.9:1
    • NaturalGlow: 2.6:1
    • Category Average: 3.1:1

 

Strengths & Vulnerabilities Analysis

GLOW Skincare Strengths:

  1. Strong revenue growth trajectory exceeding category average
  2. Competitive customer acquisition costs, suggesting effective marketing channels
  3. Solid customer retention with repeat purchase rate above category average
  4. Direct-to-consumer channel domination with 78% of sales vs. competitors’ 61% average

 

GLOW Skincare Vulnerabilities:

  1. Below-average gross margins limiting reinvestment potential
  2. Higher manufacturing costs compared to competitors (22% of revenue vs. 17% average)
  3. Lower inventory turnover suggesting potential excess inventory or stocking inefficiencies
  4. Smaller average order value ($68 vs. category average $82)

 

Recommendations to Improve Financial Performance

  1. Margin Enhancement Strategy Improve gross margin from 42% to target 50% by:
  • Renegotiating with top 3 ingredient suppliers for volume-based discounts
  • Optimizing packaging costs through material substitution and bulk purchasing
  • Implementing slight price increases (5-7%) on hero products with highest customer loyalty
  • Developing higher-margin product extensions to existing best-sellers

 

  1. Inventory Optimization Improve inventory turnover from 4.2x to 5.5x by:
  • Implementing more sophisticated demand forecasting models
  • Creating a data-driven clearance strategy for slow-moving products
  • Reducing SKU count by 15% by eliminating underperforming products
  • Moving to a more agile manufacturing approach with smaller, more frequent production runs

 

  1. Customer Value Maximization Increase LTV from $210 to $250 by:
  • Developing subscription options for core products to increase recurring revenue
  • Creating targeted cross-sell campaigns based on purchase history analytics
  • Implementing a premium tier loyalty program with enhanced benefits
  • Introducing bundled product offerings to increase average order value

 

  1. Operational Efficiency Improve operating margin from 11% to 15% by:
  • Consolidating fulfillment centers to reduce overhead and shipping costs
  • Automating key customer service functions while maintaining quality
  • Implementing a zero-based marketing budget approach to eliminate inefficient spending
  • Shifting marketing investment toward highest ROI channels based on attribution analysis

Pro tips

Competitor Financial Performance Analysis
  • Include competitor data from both public and industry sources, but be transparent about estimations where exact figures aren’t available.
  • Ensure metrics are calculated consistently across all companies to avoid misleading comparisons.
  • Focus your analysis on metrics that most directly impact your financial objectives rather than trying to cover everything.
  • Use visualization tools like charts and graphs in your presentations to make financial performance gaps immediately apparent to stakeholders.

 

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