By Olivia Drexler, ERS Intern
The Importance of Competitive Shopping:
As the world begins to move out of the pandemic, competitive shopping is critical for retailers, brands, and suppliers to maintain successful businesses. As storefronts reopen, staying on top of the competitors’ assortment mix and price points is essential in maintaining a competitive position in the market. It also ensures your capital investment in inventory is maximized. Competitive shopping can be complex and companies approach it in different ways. To develop a well-rounded view of a brand’s position in the market, you need to analyze more than the obvious factors of product categories, product varieties, quality, and price point. Looking at a brand’s exclusivity and devoted floor space within a particular retailer can give you a sense of how that retailer is trying to attract consumers. Watching it over time will reveal whether that brand and assortment strategy was effective.
To provide an accurate picture of both your own products and your competitors, it is essential to thoroughly research each of these facets. While most of this information can be found through retailer’s websites and your own POS sales data (if you serve one of those retailers), it can be difficult to get a complete sense of how brands are featured in brick-and-mortar locations without physically visiting them. It is important to note that coming out of the pandemic the existing assortment may not represent a retailer’s merchandising strategy. With altered consumer shopping habits, relocations of people from urban to suburban markets and the current supply chain disruption (a better word is disaster) it may take a few months for an assortment to take shape.
Online Assortments vs Brick and Mortar:
One of the most deceptive aspects of competitive shopping is brand presence. Online retailers often feature most brands equally, and it can be difficult to ascertain the true scope of any single brand’s product variety or quality. Through my own experience with competitive shopping, visiting brick and mortar locations has painted a different picture of each brand’s position in that space. For example, some brands that seemed very well priced and featured on the website were given undesirable floorspace. Additionally, brands that were dominant in one category may be lacking in another, despite having the same online presence in both. For example, two brands may offer products for infant, toddler, and girls’ clothing. Brand A and Brand B look equally matched online, but in a brick-and-mortar location, you find that Brand A is dominant in toddler and girls wear but falls behind in infant wear. This highlights a shortcoming for Brand A and gives an opportunity to grow which could not have been seen purely through online presence. Understanding the differences between a brand’s position online versus within brick-and-mortar locations is vital to maintaining a well-rounded view of your own products and those of your competitors.
Brands should also consider how much of their sales are online versus in stores. Understanding where sales are coming from will help brands focus their competitive shopping and strategies to ensure they are targeting the market appropriately. Improving the scope of your competitive shopping will allow for new insights and opportunities to maintain a competitive edge. ERS provides the ability to review sales and inventory by SKU by location.
Effective competitive shopping is paramount to discovering market trends that are crucial for maintaining business health and success. To keep a competitive edge, a brand needs to have a full picture of their position in both the online and brick and mortar markets. Understanding that a retailer’s website can show a deceptive assortment of products and brands can open opportunities for diversifying their product ranges and adjusting price points to be more competitive. Additionally, a favorable floor space position location can allow a brand to take full advantage of post pandemic shoppers eager to return to in person storefronts. Getting a sense of which competitors and products are positioned best in that space provides valuable insight to retailers, brands, and suppliers. For a free Competitive Shopping Guide contact ERS.