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Keeping Up With Your Competition Part II

By Don Padfield
June 28, 2016

Including a competitor pricing analysis as part of your company’s comprehensive marketing strategy is an easy decision to make. The difficult aspect is doing the research and spending the time gathering the necessary information. In the second part of my Competitive Analysis series, I will focus on the different resources available for obtaining competitor information.

As you begin to think about gathering competitor information, the first question you need to ask yourself is, “In what type of business do I operate?” Do you generally sell Business to Consumer (B2C or retail) or Business to Business (B2B or wholesale)? This distinction is important since there is a different approach depending on the type.

Business to Consumer

If you compete primarily in B2C markets, it is relatively easy to search the internet for pricing for your competitor’s comparable products. If your business manufactures smartphones, in about 30 seconds you can find your competitor’s pricing on numerous different models along with a list of comparable features by doing a simple online search.

Business to Business

Businesses that compete in B2B markets generally have a more difficult time gathering competitive data because it is less readily available; you have to work for it. Businesses that sell to other businesses do not generally post their wholesale prices on the internet like retail businesses do. Suppose your business manufactures jet engines. If you are wondering how much GE charges for their model GE90-115B engine, you cannot go to ge.com and find the price. So how do you obtain information about your competitor’s prices?

Here are several sources you can use to gather pricing information or information about a competitor’s marketing strategy, which can be more valuable. What methods you use depends a lot on what industry you are in, the size of your competitors, and whether your competitors are publicly traded. Therefore, not every option will be applicable to your business.

Sales Force

The best source for competitor pricing and marketing information should always be your sales team. Their daily interactions with your customers allow them to hear what your competitors are doing well and what they are not doing well, which is invaluable to your business. In addition, it is not uncommon for customers to give your salespeople copies of price lists or other marketing information.

Salespeople should be trained to gather as much information as possible from your customers. It should go without saying, however, that while this can be seen as a positive for being able to get this data, don’t be naïve enough to think that your customer is not giving your prices to your competitors also.

Trade Shows

Today there are trade shows for every industry imaginable. Attending trade shows is an effective way to learn a lot about your customers. Walking around the show and asking a question at different booths allows you to obtain different perspectives on your products, as well as your competition’s.

In my previous role as pricing manager for Bridgestone, I attended several truck shows. While working the booth, trucking company owners and truck drivers were always more than happy to tell you what they liked and disliked about truck tires. Walking around many of the truck manufacturer’s booths, it was also possible to acquire a lot of knowledge by asking simple questions.

SEC/Annual Reports

If your competitor is publicly traded, you can access all the SEC-required reports and the company’s Annual Report online. In addition to all the mandatory financial data, there is usually a lot of marketing information that can be extracted from the reports. For example, if market share has changed in certain regions, this could indicate a change in their marketing strategy.

Earnings Announcement Conference Calls

If your sales force is the best source of gaining competitive pricing, listening to earnings conference calls is the best way to get a clear picture of your publicly traded competitors’ marketing strategy. These calls can be a gold mine of information if you take the time to listen to them. Here is a helpful link to find your competition’s conference call date. You can search by stock symbol and many even have links right to the conference call. You can also find this information on the company’s website usually under investor relations.

Advertising

The purpose of advertising is to make the public aware of a product that is being sold. This is done by explaining the attributes of a product and why they are better than another product. What attributes of a product are your competitors trying to make the public aware of: low price, durability, style, effectiveness, speed, or size? It’s important to follow the advertising of competitors because it allows you to notice changes in the message, which can signal a change in their strategy.

Websites

As previously mentioned, if your business sells B2C, this will most likely be your main source for pricing and other competitive information. For B2B businesses this can also be a helpful resource. B2B websites are generally designed for providing users with tons of information about the company and their products. That means you can gather a lot of information about their marketing strategy. What does the company’s mission statement say? Do they want to be the low cost provider or are they more focused on delivering superior service? Those few words can indicate a lot about their strategy and what you can expect from this company in the marketplace. Digging deeper into the details will offer even more evidence.

Web Scraping

If you are looking for a way to extract pricing from a competitor’s websites without having to do it manually, there are companies who will extract the data for you. Some companies I’ve found will even generate reports that summarize the data. This process is generally reserved for B2C companies, however.

These seven sources are only the starting point of where you can begin the process of gathering competitive data. There are undoubtedly other sources of competitive information that are available to you depending on the industry you serve. Using a combination of several different sources will allow you to piece together a clear picture of how your competitors are going to market.

Now that you are able to gather all this information, what are you going to do with it?

Stay tuned for the final installment of this series where I will address how to organize your data and use it effectively.

 

  • B2B , B2C , competitive intelligence , competitor analysis , data

    Don Padfield

    Don has over seven years of experience in pricing strategy and best practices. He is part of the Global Solutions Delivery (East) Pricing Consulting team and has experience in using the Vendavo Price Manager and Deal Manager modules to implement best practices related to price setting and deal negotiation. Prior to Vendavo, Don was the Pricing Manager for the Commercial Tire Division of Bridgestone America, Inc. In this role he was responsible for price setting and strategy for a $5 billion organization.