Retailing, or any business for that matter, is often associated with competition. Every brand is in competition with at least one other brand over the same group of customers. Competition stimulates improvement in quality of services and products. It brings about positive change.
To improve, one has to first and foremost accept the fact that competition exists. Direct or in-direct, every brand is challenged by another brand. For those who believe there is no competition, monopoly does not exist, nor does perfect competition.
To compete is to prove supremacy. What is your competition offering that you are not? Are they getting more footfalls or are they offering a better shopping experience? To answer questions like these, brands indulge in competition benchmarking; to position one-self against competition to understand where your brand stands.
Analysis can be done on various parameters. To begin with we have walk-in-drivers. Here we try to understand what all is competition doing to get in more customers. Various tools can be used to attract more customers, the most obvious being window displays. A well styled display will most certainly get more eyeballs.
Increasing walk –ins is only the first step. The customer needs to be engaged. Another important aspect of understanding your competition better is to analyse the store atmosphere they offer and the kind of services they offer. Employee’s interaction and store atmospherics play a very important role here. Aspects like store fragrance, store lighting, music in the store and the store temperature (air conditioning), all add on to the store’s shopping experience.
A lot of attention is now being paid to propping within a store. Props help define a brand more. Detailing created with props engage a customer and helps create desire. This can at times be tricky, as over-propping will kill the merchandise. Merchandise, in the window or in the store, should always be the ‘eye’ of the display. A display should celebrate the merchandise. Props help highlight the merchandise.
Getting more customers in your store and engaging them longer is just half the battle won. Increasing conversions, getting more and more people to shop is what all brands want. One interesting development seen in many brands is the investment in detailing of trial rooms. Trial rooms are where decisions are made. Engaging a customer, atmospheric graphics, better lighting and a more luxurious feel is what many brands are doing.
To understand the importance of competition benchmarking, let us take two brands. Imagine the ‘Indian Television Industry’ as a brand giving tough competition to ‘Bollywood’. Both brands fight for the viewer’s attention. Bollywood tries to get the viewers to the silver screen, where as the television industry does its best to keep the viewer glued to the idiot box. Indian Premier League (IPL) does not just give the soap operas tough competition, IPL is strong competition to the traditional format of cricket. The brand ‘cricket’ in turn is the biggest competition for Bollywood. Cricket sends out its star players into the advertising industry, and Bollywood stars loose out contracts. Bollywood movies are released in accordance to the Cricket World Cup schedule. To get a glamour quotient, cricketers often rely on bollywood (take IPL for example). These two seemingly unrelated industries don’t just affect each other but also affect the fashion industry. If you belong to the fashion world, you will have to be aware of what the bollywood and cricket stars are wearing, what brands they endorse etc. Not being aware of competition and market trends has caused a lot of damage to Nokia. Once an industry leader it now struggles to survive. (In fact as nov 2014, Nokia seizes to exist in smartphone industry, Microsoft has removed Nokia from its’ branding of Lumia Windows Phones)
In 2009, Indian telecom giant Bharti Airtel became the country’s biggest music company, overtaking the industry leader Saregama, on the back of its music-related value-added mobile services. Only if Saregama could have seen that coming! (Source: http://articles.economictimes.indiatimes.com/2009-05-11/news/28467487_1_bharti-airtel-music-services-music-segment)
To get ahead of your competition you first need to know your strengths and weaknesses. Then compare them to the strengths and weaknesses of your competition. Here, an unbiased opinion is critical. It becomes far easier if audits are outsourced to a third party. A SWOT analysis can be a useful way to assess where you stand in your market in relation to your competitors. It can help you build on strengths, minimise weaknesses, seize opportunities and counteract threats.