CEO Corner
Re-evaluate the competitive landscape to stay on top of your game
2009 is here and it’s time to re-evaluate your competition. Make this your new year’s resolution and begin by asking yourself a few questions. What impact have the last 6 months economic turmoil and huge shift in crude oil and pump prices had on the competitive landscape? Is there new competition? Is the competition still pricing in the same way as last year? Is the competitor for the headline unleaded grade the same competitor for other grades?
In order to successfully evaluate your competition, you must perform three steps:
- Step 1 - Determine who the true competitors are, by grade.
- Step 2 - Rank your competitors.
- Step 3 - Analyze the quantitative impact of their price moves on your volume sales.
Using this qualified competitor strength analysis, a retailer can ensure that (a) they are price-positioning against the right competitor and (b) other competitors for a given product are treated according to their ranking (or relative strength).
Conducting a competitive analysis will give you the knowledge and information necessary to price according to your pricing policy and strategies. Otherwise, you might be playing a guessing game by trying to determine who the competition is by simply relying on location and intuition.
Our experience indicates that as many as 60% of a retailers sites can be marking against the wrong competitor, resulting in lost volume or margin opportunities. This can be quickly and easily rectified by validating knowledge and intuition with data analysis.
Make sure you’re reflecting the major changes that took place in 2008 by starting 2009 with a refreshed look at your competition.
21 January, 2009