How can I beat the competition in the grocery business

Competitor analysis

In the context of the competition analysis (which only focuses on the competitors and is therefore a sub-area of ​​the competition analysis), it is advisable to limit yourself to the most important market players. A pattern can be downloaded here.

Definition of competition analysis
Competitive analysis is the collection and analysis of business-relevant information about direct and indirect competitors. The main aim is to work out the strengths and weaknesses of the competition in relation to your own company in order to determine competitive advantages.

Which companies are relevant for the competition analysis?

1. Current major competitors

These competitors are mostly the most important players in the industry, the number is usually in the single-digit range. Ultimately, however, you decide who is to be included.
Think about which criteria are important to you. Define these criteria and rank / filter your competitors accordingly. Finally, reduce the number so that only the most important (max. 5) remain. These are then analyzed in detail.

2. Potential competitors from your own industry

Companies that are either locally strong (in an area that interests you) or have high growth rates should also be considered.

  • Are there companies that are currently still small, but have amazing growth rates?
  • Have you often lost to a particular competitor in your last sales pitch?

Small companies in particular are more flexible than larger units and can stir up a market with new products and services. It is important that you do not overlook them.

3. Companies from outside the industry that can become competitors

There are different reasons that lead companies to enter your industry:

A) Market expansion: Companies that have not yet been active in your geographic market can identify this as a growth market.

B) Production expansion: If companies have similar machinery and this is not fully utilized or the existing production is no longer profitable, the company can decide to manufacture products in your product category.

C) Forward or backward integration:Current suppliers or customers can decide to broaden their value chain and manufacture or market your product category themselves. For example, ASUS has established itself as a supplier of well-known hardware manufacturers to a provider of notebooks. Another example are grocery retailers who make life difficult for traditional grocery brands with their own brands.

D) Acquisition of a competitor: A small competitor is bought through an M&A transaction; the financially strong buyer can strongly influence the market.

E) Technological development: As industries grow together and digitalization, which enables new business models, companies encounter new competitors that they would often never have thought of. The automotive industry, for example, faces the challenge of having to regularly monitor both energy suppliers (= filling stations for electric vehicles) and IT companies such as Google / Alphabet or Apple (= networking) as competitors. In order not to have to rely on Google's map service (Google Maps), leading German automobile manufacturers, for example, have teamed up and acquired the company HERE.

What should be examined in the competition analysis?

Competitive analysis focuses on the strengths and weaknesses of the competition and on identifying best practices that can be implemented in your own company.

Strengths / weaknesses of the competition

When analyzing strengths and weaknesses, we work from three perspectives. From a company, customer and competitor perspective (see also the strategic triangle).

  • What are the strengths / weaknesses of your own company?
  • What are the strengths / weaknesses of the main competitors?
  • Where do customers see the strengths and weaknesses of our company compared to the competition?

Best practices / benchmarking

  • What can we learn and adopt from our competitors or other players?
  • How is sales organized?
  • How is the supply chain organized?
  • Based on the analysis, are there any indications of competitive advantages among competitors that we cannot compensate for?
  • Does the competition use alternative production methods?

Product analysis - analysis of competitive products

Here, the competing products are compared to their own and certain differences in terms of properties, appearance / design, functionality, ergonomics or similar are recorded. You can find a comprehensive article on this under Product Analysis.

How is the competition analysis actually carried out?

Why is the competitor acting like this? What are his goals?
In order to know why some decisions are made in a competing company, it is important to familiarize yourself with their goals. What is the financial situation like? Is the division one of the most important or less important of the company?

Where are the strengths and weaknesses of the individual competitors?
This can best be analyzed in a direct comparison with your own company:

The book Competitive Analysis shows which content and analyst tools are used in practice. Structured and focused with many templates and checklists.

Comparison factors are, for example:

market

  • Image and degree of awareness
  • customer focus
  • Market share, prices


organization

  • Internal cost structure
  • Employee motivation
  • Transparency / openness

Processes

  • distribution
  • Production capacities
  • Scalability


Finances

  • Cash flow
  • Leverage
  • Profitability

Which strategic cornerstones has the competition taken?

  • Cost leadership?
  • Niche supplier?
  • Quality leadership?


Should we react to this and if so, how?

  • Start with weaknesses of the opponent and your own strengths
  • Act proactively if possible
  • React quickly when only reactive action is possible

You can find concrete practical examples and tips & tricks from many years of experience in our Books or you can visit our Seminar competition analysis.

Difference between competition observation and competition analysis

If the activities of competitors are continuously analyzed (using alert services, press clippings, etc.), this is understood as competition monitoring. One-off analyzes of competitors is called competition analysis.

Analysis of the online activities of the competition

What information does an online competition analysis provide?

The Internet offers a wealth of information and tools to better understand markets and competitors. It is best to conduct an online analysis of competitor activities in the following six areas:

1. Online presence (s)

Here it is analyzed how the competitor presents itself on its own website and on which online platforms it can be found. Questions are:

  • Which technologies are used?
  • What are the access rates on the website?
  • Where are the competitors mentioned?
  • On which websites does the company introduce itself?

2. Content

Here an analysis is carried out on which content and messages the company relies on:

  • Which topics and statements are being promoted by the company?
  • What is the competition focusing on?
  • At what prices are products offered and how do prices change over the year?

In order to be able to determine which topics are receiving more attention, the tool Google Trends can be used.

Example: If you search for the terms big data and machine learning in Germany, the following picture emerges:

Screenshot Google Trends | Click to enlarge

At the beginning (2015) the term big data is searched three times as often as machine learning, but since the beginning of 2017 the picture has changed and machine learning is the "nose ahead".

3. Social media presence

Here it is analyzed on which online platforms the competitor can be found.

  • Is the company represented on Youtube, LinkedIn, Xing, Facebook, Twitter etc.?
  • How much are these platforms used? E.g. Facebook: number of fans, fan growth, weekly contributions, weekly interactions
  • How many posts does the competitor post?
  • How are these liked?

4. Search engine marketing (SEM)

In search engine marketing, the competitor's paid advertising activities are analyzed.

  • Which advertisements does the competitor place online?
  • Where are these switched?
  • In which extensive? -> Conclusions about the budget

5. Search engine optimization (SEO)

Search engine optimization analyzes the competitor's free advertising activities.

  • What keywords are used for advertising?

6. Local Marketing & Market Feedback

Interesting insights can be gained on Google Maps and the Google Knowledge Card.

Example: Restaurant Borchardt

The Borchardt restaurant in Berlin. On the Google Knowledgecard you can read out a range of interesting information at a glance. For example, the opening times, empirical values ​​when the restaurant is well attended, reviews from other guests and much more.

Source: Screenshot Google Knowledge Card 04.04.2017

In summary, the possibilities presented here show that much more is possible with an online competition analysis than with a corresponding analysis in the offline world.

Example of a competition analysis

e-scooter market in Europe
The current development in the e-scooter rental market, which picked up speed in Q4 / 2018, is considered as an example of a competitor analysis. An e-scooter is an electrically operated scooter that has a maximum speed of 25 km / h.

Several providers are already on the market in Vienna. The daily newspaper DerStandard tested 3 of them and published a video about them:

e-scooter Lime in Breslau - Wroclaw

providers

Funding

Current presence in Europe

Website

Founder or europ. ladder

Bird

$ 400 million

Brussels, Paris, Vienna

https://www.bird.co/

Patrick Studener

Go Flash

?

-

-

Lukasz Gadowski (Spreadshirt)

Lime

$ 132 million

Paris, Vienna, Wroclaw

www.li.me/electric-scooter

Gauthier Derrien

Tier Mobility

€ 27 million

Vienna

www.tier.app

Laurence Leuschner (rebuy)

wind

Bordeaux, Paris, Madrid, Lisbon

www.wind.co

Julia Boss

Swell: German startups, Start-up scene, Wirtschaftswoche, Inc., The Verge
Status: 10/22/2018

App downloads from e-scooter providers since 1.1.2018
(Germany in millions)

Source: from Manager Magazin 12/2019 - PrioriData
Status: December 2019

Seminar competition analysis

Competitor analysis seminar

We regularly organize seminars on topics relevant to the market and competition. One of the fixed points is the seminar on competitor analysis.

Competitor analysis template as download

To create a competition analysis for the business plan or other internal company projects, you can find one here templateset in the xls format

Competitor analysis template

  • Competitor analysis in Excel format -editable xls file
  • Time saving for you!

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