Last week we took a look at how to conduct competitive and market research to develop your ecommerce and online marketing strategy. A strong visual layout of that competitive information will help you as you develop your online strategy.
One technique I find useful is to create a grid that shows how each competitor – and your company – rate in various strategic areas. For instance, it’s helpful to rate each company according to the 4 “P’s” of markting – its online product offering, its distribution strategy (also known as place or sales channels), the price and price strategy offered, and how each promotes itself. I prefer using a 4-point scale ranging from +2 to -2 (ignore 0). A “+2 rating” indicates the competitor does a great job, while a “-2″ says they don’t offer it – or do it so poorly they’d be better off if they didn’t at all. The middle values account degrees of success or failure. For example, comparing yourself with two competitors, you might end up with a grid that looks like this:
|Competitor A||Competitor B||Self|
Obviously, you’d likely have multiple rows for each “P” to account for any differences. For instance, when reviewing product, do your competitors offer all their products or only some? Do they monetize their traffic using ads or affiliate marketing? Does their distribution strategy only include their own website? A mobile site? Use third-party distribution, such as Craigslist, Ebay, Amazon, Expedia? Affiliate sites? For price, do they offer price parity across all channels or do they offer price preference for one?
Clearly, you’ll see overlap between your online strategy and your overall business strategy. That’s a Good Thing. It’s when they don’t overlap that you should worry.
Once you’ve gotten these items placed into a grid, it should be easy to identify where you compete head-to-head and where there are gaps in the marketplace. Next time, we’ll take a look at how to exploit those gaps to develop an online strategy that’s second to none.