Making Competitive Intelligence Work For The Bottom Line
That is the power, in essence, that competitive intelligence gives you. In this post we look at how you can use competitive intelligence to spot growth opportunities and improve conversions for your business.
How Competitive Intelligence Works
First, it’s important to know what competitive intelligence is and how it can be used to a company’s advantage.
While gathering all this information manually is possible, we use competitive intelligence tools like Competitor Monitor
to make data gathering much faster and error-free. Such a tool helps by providing, among other things:
- Prices - See what prices your competitors are selling their products at.
- Product Assortment - Keep track of new products in the market, and know who is selling what.
- Promotional Activity - See what promotions your competitors are running, including coupons and flash sales.
Competitive intelligence is useful for a variety of industries, but particularly for retailers as well as businesses in other highly competitive markets.
Driving Market Insights With Competitive Intelligence
Having data available is one thing, but turning that data into actionable decisions grows the bottom line of your business.
Here are practical ways that you can turn the data into actionable insights or game plans for growing your business:
- Marketing Data - Use this data to inform marketing campaigns and optimize ad spend. Putting this marketing data to use can help your business’s bottom line directly through higher sales of your own product.
- Product Supply Data - This data can be used as a guide to how much of a product is supplied in the market. You can use this data to find opportunities for higher sales, for example finding new products to sell, or growing market share for existing products.
- Conversion Data - Conversion data can be used for optimizing your own landing pages, product pages, and other website URLs. Working with copywriters and conversion rate specialists, you can achieve much higher conversions to derive more value from all the traffic you drive to your store.
Below, we will expand more on these practical ways to drive market insights, growth, and conversions from competitive intelligence.
Maximizing Return On Ad Spend With Competitive Intelligence
When building out your ad campaigns, you can use competitive intelligence to maximize the return on ad spend
. A simple way to measure the return on ad spend is to simply divide the total revenue from an ad campaign by the total cost of running the ad campaign.
At a tactical level, you can use competitive intelligence to identify the right keywords to bid for, as well as to improve your ad targeting so you reach the prospects most likely to buy.
Identifying Product Keywords To Bid For In Search Advertising
In search advertising using platforms like Google Ads or Bing Ads, traffic is driven
to the advertiser’s website based on search keywords. A regular user types a keyword or group of keywords in Google, Bing, or another search engine. Based on the keywords they entered, they get shown relevant ads along with organic (unpaid) search results.
To run profitable ad campaigns, as an advertiser, you need to pick the right keywords to target for your paid search campaigns.
You can begin with the obvious keywords that describe your product. Chances are, however, that those keywords could be saturated and cost more.
You can use competitive intelligence data to find out which keywords your competitors are bidding on and, thus, identify possible new keywords to target.
Identifying The Customer Sub-groups Competitors Are Targeting
On other ad platforms, especially social media ad programs, you can target users based not on search keywords, but on attributes like demographics. This is the case, for example, for Twitter and Facebook ad programs.
Using data acquired through the process of competitive intelligence, you can ferret out the categories of users or demographics that competitors are targeting. This ensures that you do not get left out of reaching a potentially lucrative target demographic for your product.
Finding New Niches To Target In Your Advertising
Sometimes, competitors leave entire categories of users unaddressed in their ad campaigns. Once you have an idea of what keywords or user categories competitors are targeting in their advertising, you can begin to look for opportunities addressing entirely different user groups.
If your product has primarily been targeted (both by you and by competitors) at older women, you might find a way to target it at younger women. The same applies for a product targeted primarily at, say, lawyers. You might find a new, profitable market by targeting it at doctors or other professional groups in your ad campaigns.
Boosting Conversions By Studying Competitors’ Stores
Just as you can study a competitor’s prices to see what prices are working best, you can also study websites and calls to action (CTAs).
You need to be careful not to wholesale copy your competitor’s websites as this could be illegal.
However, you can learn from how they are converting store traffic to buy, and use this data to inspire your own conversion rate optimization process.
Spotting Growth Opportunities Using Competitive Intelligence
You can use product data gathered through competitive intelligence to grow your overall sales through new product opportunities. This involves both optimizing existing product sales and entering new markets when you see a gap in the market.
Optimizing Your Prices For Highly Competitive Products
Many retailers think instinctively of adjusting their prices to be more competitive when they hear of “price intelligence” or “competitive intelligence.” Indeed, it is true that big market opportunities can be spotted from price intelligence data.
When you see the overall prices at which competitors are selling similar products, you can grow your own share of the market through actions such as the following:
- Advertising lower prices for the same goods
- Running temporary promotions to gain market share
- Giving coupon codes to new shoppers to try your products
Identifying Less Competitive Products to Sell
Yet another way market data helps you is in spotting less competitive products to sell. When a new product enters the market, competitive intelligence tools can help you spot an opportunity where few competitors are selling a product.
In this case, you should stock up and begin advertising this new product to interested buyers ahead of your competitors.
Winning the Market with Competitive Intelligence
Using competitive intelligence in your retail business can drive market insights, growth, conversions, and more for your store. Competitive intelligence involves studying the competition and keeping tabs on what they are doing that is working. Far from being a theoretical exercise, the data you gather can be used directly in growing your retail business. You can apply this data and insights practically in your ad campaigns, product pricing, and in finding new products to sell.