In all businesses, keeping track of competitors’ positioning and performance in the market provides insight into the retailers’ ability to pursue various strategies. Analyzing the primary and secondary competitors’ and identifying their Strengths, Weaknesses, Opportunities and Threads (SWOT Analysis) help determine target markets, marketing strategies, sales forecasting and sales planning. 

The Competitor Benchmarking module provides a deeper insight in understanding a competitors’ strengths and weaknesses from the 4Ps of marketing mix:-

(i) Product 

(ii) Distribution Channel

(iii) Pricing 

(iv) Promotion/Discount

Step 1: Understand competitor discounting strategy

Metrics Combination – Total Products, Discounted

The data reflects the contribution of discounted products over total products for respective retailers. Observed different discounting strategies have been adopted by Love Bonito, The Editor’s Market and The Closet Lover respectively in the period of June till August 2020.

As a general overview, total products available within this period has increased by +10.17% in comparison to previous period (March till May 2020), with higher discounted products available (+51.49%). These data indicate that these retailers are more promotional driven this period. 

In terms of Love, Bonito, observed the first two weeks of June has been a discount period for her with high SKUs being launched at discounted price. These discounted products have been removed from the website in the third week of June onwards, remaining with only Full Price products. Insight gained here is that Love, Bonito has adopted different distribution channel strategy in stock allocation to different platforms to cater different customer buying behavior which would eventually induce purchase.

In the case of The Closet Lover, observed significant numbers of SKUs are on discount throughout the period. In contrast to the other two retailers, The Editor Market however, did not launch any discount activities in their own domain within this period. 

Step 2: Evaluate the effectiveness of competitors’ strategy

Metrix Combination: Total Products, Discounted, Sell Out

Include the Sell Out matric to evaluate the effectiveness of competitors’ strategy highlighted in Step 1. 

Observed Love, Bonito registered the highest and most consistent sell out in compared to The Editor’s Market and The Closet Lover. This depicts an effective discounting and stock allocation strategy Love, Bonito has adopted to drive strong sales conversion. 

Step 3: Analyse competitors’ pricing strategies

Pairing the insights gained from Step 2 to further evaluate the effect of pricing and discounting strategies on respective competitors’ performance. 

Look into the Trade Analysis tab to understand further. Here, we observed that The Editor’s Market is the only retailer not offering any discounts. Nevertheless, observed the Median Price for both Love, Bonito and The Editor’s Market is similar at SGD34-36 range, reflecting the reactivity of target customers towards this price range. It also shows an indicator of Love, Bonito’s sensitivity in reactiveness to the market, in offering competitive pricing to keep track of any changes in customers’ price elasticity in purchase. 

Whilst observed The Closet Lover who focuses more on discounting strategy and replenishment holds a lower sell out rate depicts customers remained inquisitive about new products, however price is a key element to look into at this period of time should the brand wish to drive sales conversions. 

Key Takeaways

Data insights gained on competitors’ performance from different pricing and discounting strategies aid in identifying competitors’ strengths and weaknesses. The knowledge of a competitor’s strengths and weaknesses forms an important part of research for retailers to identify the gaps and formulate alternative strategies addressing the opportunities. Both short and long term strategies could be formulated, to achieve respective objectives for the businesses. 

Hope you found this article helpful! If you have any questions or would like to explore the Omnilytics dashboard further, feel free to reach out to your respective Client Success Manager.

Was this article helpful?

en_USEN