Competitive analysis
Competitive analysis in marketing and strategic management is an assessment of the strengths and weaknesses of current and potential competitors. This analysis provides both proactive and defensive strategic context through which to identify opportunities and threats. Competitor profiling coalesces all of the relevant sources of competitor analysis into one framework in the support of efficient and effective strategy formulation, implementation, monitoring and adjustment.
General approach, common for most of research industries, is first to split all competitors into two major groups: Russian producers and non-Russian producers who have a share in the Russian market. This split is meaningful for many companies, as Russian consumers have very different perception of Russian-made versus foreign products. It is a common belief, and usually goes without saying, that foreign producers offer much better quality products with modern design. Preference for Russian products – thus supporting national industrial and economic development – is usually a mere declaration rather than an actual decision.
According to a survey, Russian buyers have high loyalty to foreign-produced machines, hi-tech, perfume and certain kinds of food products and alcoholic beverages.
Current trend includes very active entry of Chinese automotive and construction equipment manufacturers into a Russian market. Even though these foreign producers are not yet viewed as high-quality suppliers, price is often a sound argument that makes Russian consumers buy these products.
The following table provides split of Russian industries according to standard competitive classification.
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Examples – Russian companies | |
| Free competition | Food market, clothes market, jewelry market, fast-food market etc. |
| Monopolistic competition | Oil market, air transport market etc. |
| Oligopoly | Beer market, mobile operators market, mobile phones vendors market etc. |
| Monopoly | RZD (Russian railroad company), GAZPROM (Russian gas company) etc. |
Competitive analysis project usually deals with the following questions:
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determine the number of competitors
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analyses of competitors’ manufacturing and distribution footprint
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nomenclature analyses and category gap definition
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pricing policy research and cost structure review
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customer segmentation analysis and target segments definition
One common and useful technique is constructing a competitive array. The steps include:
Step 1 - Define your industry - scope and nature of the industry
Step 2 - Determine who your competitors are
Step 3 - Determine who your customers are and what benefits they expect
Step 4 - Determine what the key success factors are in your industry
Step 5 - Rank the key success factors by giving each one a weighting - The sum of all the weightings must add up to one.
Step 6 - Rate each competitor on each of the key success factors
Step 7 - Multiply each cell in the matrix by the factor weighting.
Sum columns for a weighted assessment of the overall strength of each competitor relative to each other.
Commonly used data collection techniques include:
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Desk research and review of state statistics reports
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Commercial databases analysis
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Mystery shopping
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Simulation of a purchase intent
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Simulation of service request
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Trade show research
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Distribution network review
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In-depth interviews with industry experts
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Delphi method of market volume and trend estimation
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Conjoint and discrete choice analysis for market scenarios simulation
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Brand awareness research
Bazis IG have conducted competitive research and analysis in the following industries
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construction companies
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medical companies
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automotive
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cellular communications
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alcohol market and some other industries.
