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All businesses, whether large establishments or small companies, need to evaluate their position in the industry continuously. It is essential to keep a tab on the latest developments to check how the industry is changing over a period of time. Businesses should review their long-term prospects and evaluate whether it continues to remain positive in the industry.

Category analysis is the process of researching the market to understand the reasons behind the demand for a product category and the supply market. Category analysis involves a deep understanding of the product category as well as detailed analysis.

When a company does not have enough market knowledge, it can lead to turbulence in business, which can lead to its decline. Information about competitors and their marketing activities will enable a company to make timely business decisions. It will take you ahead of your competitors. Competitor analysis becomes key to identify opportunities.

Companies should go more in-depth and conduct market research to understand brand perception. This research will lead to understanding the strengths and weaknesses of a product. When you bring about improvements at the product category level, it will lead to a positive connection with your brand.

Product categories are essential for marketers to identify the sources of competition and thereby, the opportunity that can be explored. Product categories help marketers to position their brand and promote them effectively.

Brands who want to be successful should work to understand the landscape in which they operate. Competitor analysis and customer analysis is a must to lead a brand to success.

Data Sources For Category Analysis

Before starting category analysis, you need to gather data for the analysis.

Data can be sourced from primary and secondary sources. For a detailed and accurate picture of your analysis, it better to use a wider variety of sources.

Sales Data

Your inhouse sales data can be the starting point for the analysis. It could be used to analyze the patterns and trends year on year.

Sales personnel

People who are involved in sales, managing accounts and answering customer queries will have firsthand data relating to product category. These customer facing personnel will have a collection of unique insights into the customer reaction and their perception of your brand. This data will be useful for category analysis.


Though a very traditional method of data collection, it is a very effective as it can be built as specific as possible to collect very accurate data.

Surveys offer quantitative insights for that help to understand consumer views on a larger scale.

Social Media Data

With many brands on social media, it is now possible to gather social intelligence through a range of techniques such as Artificial Intelligence.

Social media research reveals brand and market-wide conversations happening on the social media platforms.

Social data allows granularization of the data by segmentation, either manually or with the help of automation. Variety of competitive analysis can be conducted using social media data.

Secondary/Publicly available data

Secondary data will be readily available on public forums and can be used for analyzing the product category. Research firms might have published category analysis data without being very specific to your product questions. Secondary data can be used in combination along with your primary data. 

Elements of Category Analysis 

Category analysis should include some of the important factors mentioned below:

Category Drivers

What are the key drivers that make customers adopt the product/services?

Category trends

What are the emerging trends in your product category?

Customer Beliefs

What do customers in your product category believe about your product?


Who are your customers? What is their age, gender, income and location? What are some of the other sub-categories in market?

Market size

How big is the market for your product?


What are the factors affecting the profit in your product category?

Competitor Analysis

How is the competition in your product category? Who are your main competitors?


Is the product category growing rapidly? What is the historical growth rate of your product category?