How does competitive intelligence help retail businesses?
In the aggressively competitive world of retail, competitive intelligence can count for a lot.
As a retailer is any business that sells directly to customers, the term “retail” covers a multitude of businesses, ranging from the Walmart Group to your local, family-run pet store. However, some general principles can be applied across the industry.
There are numerous ways that competitive intelligence can help any retailer. Competitive intelligence can help you pounce on any advantage, avoid potential pitfalls, and keep a constant watching brief over the competition.
There’s a lot more to retail intelligence than sending in a mystery shopper...
Investigating your competitors’ pricing
In a competitive sector such as retail, much of the war is fought on price. It’s essential that the retailer knows what the competition is charging, and this is something that competitive intelligence can look at in detail.
We look at cost price, sales price, supplier bulk discounts; and by building up a complete picture of pricing, you have a good opportunity to set your prices strategically and negotiate with suppliers from a position of strength.
Competing on products
Do your competitors have any new product ranges in the pipeline? In many branches of retail, from IT to high street fashion, innovation is everything. Trade shows and conferences can help here.
Being aware of potential category killers, the strengths and weaknesses of suppliers and manufacturers, and any new product roadmaps can really help you find advantages and keep you ahead of the competition.
Suppliers and logistics
A large retailer with many branches has to have its supply chain and logistics absolutely nailed. There are lots of potential weak points in this where you can edge in and gain advantage. Looking into distribution includes analysing warehousing, transport, inventory management, and other information and communication systems used. How much is invested in distribution?
There are always two major territorial issues to consider. What territory can a retail business expand into, and what’s going on in theirs?
Competitive intelligence can investigate potential new territories – the demographic market, the competitors, the opportunities. A retailer also has to keep an eye on their current patch. Look out for planning applications, not just from rivals but for anything that could be a potential benefit (new self-catering apartments near a small format grocer? Ideal! Start tailoring that range...)
Competitive intelligence and online retail
However, not all territory is physical, with online the fastest growing part of retail.
As retailers with an online presence compete on pricing, range, and customer service (which ironically become more important when the customer is remote), smaller businesses without this offer suffer, as suddenly their competitive set has become global. Competitive intelligence can provide a complete picture of the competition’s front end, back end, logistics, supply chain, partners, and marketing.
Retail marketing research
We all know the primary marketing messages of major retailers. But how successful are these campaigns and how do they measure this? How do they position themselves against the competition (that means you), and what advantage do they gain?
It’s helpful to know what buyer personas your competitors have created. What markets are they aiming at? We speak with marketing agency experts as well as consumers to give a well-rounded picture.
A look at the competitor’s organisation
Anything to do with staff is always newsworthy. That Sainsbury’s is to cut training jobs was announced earlier this week, and made the business sections. Looking behind the headlines, we research the company’s structure, which is a great way of health-checking it (why is Sainsbury’s needing to restructure?) as well as assessing its flexibility, specialist skills, and staffing budget. A trawl through LinkedIn will give an insight particularly at management and head office level, as will employees and employment agencies.
This is a general snapshot into how CI can help retailers gain advantage in their extraordinarily competitive industry. At Aqute, we’ve experience of investigating all aspects of retail. Please contact us to find out how we can help your retail business gain a valuable competitive advantage.