If you decide on a new business, but you have overcome doubts and you do not know where to start, then the analysis of competitors should become the first step. The key to success in any business is excellent preparation. You must have full information about your rivals to always stay one step ahead.
What is a competitor analysis?
In the field of e-commerce, competition is growing every day, therefore all accessible tools from your arsenal need to be used. You should always have operational comprehensive information not only about your direct competitors but also on your own position. You must be a realist and clearly realize your strengths and weaknesses.
The main method for analysis is the primary monitoring of competitors’ prices. Collecting price data, assortment, promotions, features of logistics chains, service, and warranty obligations, you will get a significant array of data that will help assess the potential of competitors.
The key to successful analysis of competitors is the right choice of “sources” of data. The basis of any strategic plan is qualitatively conducted market research. From how much more thorough preparation will be, the final result depends. Therefore, marketers who know their work are spending about 40 working hours a week analyzing competitors’ prices.
How to conduct a competitor analysis?
The study and data collection must be systematic to obtain the most accurate data, further analysis, and develop their own effective pricing policies and promotion of goods on the market.
What is worth paying attention to and what to do with the information received?
- Websites of competitors. This will require a lot of time, but in the long run, it will repeat itself. You can evaluate the structures of sites, see the main partners, the date of creation, authors, and position in search engines. If there is a blog or forum on the site, then this is an invaluable table of information on many major topics, the specifics of goods, and reviews. The study of the site does not require special skills, just attentiveness and time.
- Information from eyewitnesses. Former competitors’ employees can share such information that you will not find anywhere. Invite one of them to the interview to excite something useful in the unobtrusive form. If the level of professionalism and the skills of the applicant suits you – boldly take it to work. It will become an invaluable source of information and will know about all the shortcomings of competitors who can be turned into significant benefits for your company.
- Social networks. In stores that have active pages or communities on social networks sales by 1/3 are higher than those who do not use them. Information received from social networking pages will also complement your main competitors and increase the quality of analysis. Groups of pages can be used to communicate with subscribers, customer service, and product promotion. Here you can learn some ideas for your own business or detect errors and take action to avoid them in the future.
- Client experience. Even if customers found you earlier than competitors, it is still not over yet to relax. If your site “slows down” has an uncomfortable structure or navigation, then potential buyers will leave, and everything that has been done to attract them is in vain work.
Studying the site of competitors, imagine yourself on the site of their buyer and try to give him an unbiased assessment. Would it be convenient for you to use this site? If the answer is positive, then think about what you would like to use on your site, take the experience. The client attracts 2 basic parameters: simplicity of searching for the desired goods and a pleasant design.
- Monitoring of competitors. The main goal on which is to focus – this is an analysis of the pricing of competitors. The price remains a decisive factor in the field of Internet commerce, therefore it is worth paying time to a thorough study of competitors in this aspect. Only at first glance, it seems simple – just compare your prices with the proposal of competitors. If you have no one competitor, then there will be a lot of data. Large volumes of information about competitive advantages are difficult to collect manually. For such cases, there are tools in the form of services providing competitive pricing software.
Basic methods of monitoring of competitors
Monitoring of competitors’ prices is a base for analytics of the situation and trends reigning in the segment. If the collected data is outdated or not complete, then you will not see the real situation on the market, and all work will be in vain. Therefore, to choose the method of monitoring prices of competitors, it is better to come as much as possible and picky.
Manual information collection. It is the easiest solution that is available absolutely to any company.
A special employee monitors competitors’ prices and on the basis of the collected indicators makes an analysis of the market status. This method can be successfully used only by very small stores with a narrow range of 100-200 commodity positions. It should be borne in mind that to collect data about 1000 products spend on average 7-8 hours of working time. Also, do not forget about the human factor and the increased probability of errors, both at the stage of collecting information and during analytics. Even if the report is without errors, then the information in it will be outdated.
is one of the most dynamic, the situation on it is changing in a matter of minutes, not to mention the clock. Therefore, the less time passed from the moment of information gathering and until the report is submitted, the better.
Monitoring of competitors’ prices on price platforms. Also cannot be considered a full source of information.
Online stores place their products in online catalogs solely for promotional purposes, and not to simplify the monitoring process to competitors. Often, price aggregators are replete with embarrassing goods, with the help of which customers are involved, but do not reflect real prices. The catalogs are loaded by several of the “sweet” proposals, and not a complete range of the store. Therefore, conducting monitoring of competitors’ prices on price aggregators, a great chance as a result of obtaining a report with incomplete and outdated data, which will not appear in market realities.
Monitoring of competitors with parsers. Provide fast and accurate data collection.
Regardless of whether the parser was specifically written for your company or a ready-made monitoring program was purchased, they will require regular updates, corrections, and additional settings. With any changes in the structure of the site-competitor, the programmer intervention is necessary, for the further correct work of the parser.
Special for much simplifies the collection of statistics and minimizes the chance of mistake due to the influence of the human factor, but is also not an ideal solution. Pricing information is reduced to a special table, but it is only dry facts, and it will be necessary to carry out the analysis manually. This internet marketer will spend a lion’s share of working time, but guarantees that there will be current information in the report, no.
Automatic monitoring of competitors’ prices with special services. At the moment, the most effective method.
Companies using this method of market research are always confident in the relevance, completeness, and accuracy of data. It automatically takes place not only to collect information but its analysis according to the specified parameters. This makes it possible to quickly get data on the prices of competitors and the state of the market while reducing almost 0 the probability of error.
The introduction of automatic monitoring services of competitors in the company’s business processes will require some training and, at first glance, it is not cheap. However, in the long run, their use is much more profitable than content in the staff of a monitoring specialist. Costs pay off in the very first year, and all service support (update, configuration, correction of troubleshooting) lie down on the shoulders of the company providing services.
As you already understood, the analysis of competitors in the field of online sales is based on a comprehensive approach to data collection. You can select key aspects for comparison but completely neglecting the rest will be a mistake. This is a dynamic and changing market segment, where there will always be relevant to the application of some innovative approaches. Any additional tool for analyzing competitive pricing, embedded in the business, is able to bring the case to a completely new level.