What is the right way to conduct competitive analysis in retail marketing?

1 Define your competitors

The first step is to define who your competitors are, both direct and indirect. Direct competitors are those who sell the same or similar products or services as you, while indirect competitors are those who offer alternatives or substitutes that can satisfy the same customer needs. You can use various sources to identify your competitors, such as online directories, search engines, social media, industry reports, trade associations, or customer feedback.

2 Analyze their marketing mix

The next step is to analyze your competitors' marketing mix, which consists of the four Ps: product, price, place, and promotion. You want to examine how they design, develop, and deliver their products or services, how they set and communicate their prices, how they distribute and sell their products or services, and how they advertise and promote their brand and offerings. You can use tools such as SWOT analysis, benchmarking, or perceptual mapping to compare and contrast your marketing mix with your competitors'.

3 Evaluate their performance

The third step is to evaluate your competitors' performance, both qualitatively and quantitatively. You want to measure how well they are achieving their goals, satisfying their customers, and generating revenue and profit. You can use metrics such as market share, sales volume, growth rate, customer retention, customer satisfaction, net promoter score, or return on investment to assess your competitors' performance. You can also use sources such as reviews, ratings, testimonials, or complaints to gauge your competitors' reputation and loyalty.

4 Identify their strengths and weaknesses

The fourth step is to identify your competitors' strengths and weaknesses, based on the previous steps. You want to highlight what they are doing well and what they are doing poorly, and how they affect your competitive advantage and positioning. You can use tools such as VRIO analysis, Porter's five forces, or value chain analysis to determine your competitors' strengths and weaknesses.

5 Learn from their best practices and mistakes

The fifth step is to learn from your competitors' best practices and mistakes, and apply them to your own retail marketing strategy. You want to emulate what they are doing right and avoid what they are doing wrong, and find ways to improve your own performance and differentiation. You can use tools such as gap analysis, SMART goals, or action plans to implement your learning and improvement.

6 Monitor their actions and reactions

The final step is to monitor your competitors' actions and reactions, and adjust your retail marketing strategy accordingly. You want to keep track of any changes or trends in their marketing mix, performance, strengths and weaknesses, or best practices and mistakes, and how they affect your competitive position and opportunities. You can use tools such as alerts, newsletters, or social listening to monitor your competitors' actions and reactions.

7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?