Obtaining Information on Competition

What you’ll learn to do: Evaluate the elements of a competitive analysis

Competitive analysis is an integral part of developing an organization’s marketing strategy. It is done by identifying competitors, then evaluating their strategies for strengths and weaknesses relative to your own. When done effectively, competitive analysis helps you understand your competitors’ capabilities, which will inform you how they go to market and what they prioritize in their operations.

“A horse never runs so fast as when he has other horses to catch up and outpace.”  

—Ovid

Retail is a competitive business. Nowhere is this more true than in food retailing, where channel expansion, concentration of sales, e-commerce, and changing consumer behavior have converged to alter the industry dramatically. Moreover, change will continue, driven by many of these same forces. Thus, it’s important for retail leaders to understand ways to assess their competition to ensure that they have a good understanding of the strategic strengths and weaknesses other retailers bring to the market. In doing so, they will ensure that they are able to pursue higher levels of performance.

Understanding the competition and its strengths and weaknesses through an analysis of the industry and competing forces gives a company a competitive edge. Competitive intelligence  is the collection of that information from the marketplace. A company’s position must be examined to determine if it matches with the needs of the customers.

This competitive intelligence may be related to any of the marketing mix elements: product, price, distribution, or promotion. Checking prices of competitors’ products to make sure a company’s pricing is competitive, conducting a promotional audit to verify reach of the messages, or examining the competitive industry’s distribution channels may allow the company to identify a new location, and all help to make the company more educated on future decisions. When in a competitive space, why do customers choose the competitor over the company’s products? Marketing research can come in many forms and helps managers to make data-driven decisions. Once this data is collected, it becomes part of the business or organization’s internal data cache.

Fortunately, there are many ways for one to collect information on the industry and its players:

• Industry
  • Government reports
  • White papers
  • Industry publications

• Specific competitors
  • Press releases / company websites
  • Financial reporting
  • Weekly circulars
  • Store visits

Sources of information specific to the cannabis industry are evolving. Publications like MJBizDaily, Cannabis Business Times, Green Market Report, and the National Cannabis Industry Association are great resources for following the national industry. For updates on New York’s cannabis industry, Syracuse.com publishes a weekly feature called NY Cannabis Insider’s Week.

If you’re looking for information on specific cannabis growers, processors, or retailers, you can set up Google Alerts to track their coverage and press releases. Furthermore, company websites and social media channels provide information on their promotional activity, store schedules, and other important topics. For additional information, consider reviewing the financial reports that publicly traded companies publish quarterly (10-Q) and annually (10-K and Annual Reports). These filings provide comprehensive information on operations, including sales revenue, operating expenses, profit, and other factors. In addition, the filings also include forward-looking statements from company leadership that reflect priorities. These documents provide a great deal of information about how firms operate.

Incumbent with this, it’s important to spend time visiting competitive retailers. This might provide insight on store layout, including how much space is dedicated to specific departments or categories, staffing levels, promotion and display activity, merchandising tactics, and pricing without promotion. Please note that the importance of store visits cannot be over-emphasized. They are critical in providing a hands-on experience of the competitive retail environment.

Regardless of whether you’re interested in macro industry trends, the performance of rivals at the corporate level, or how well your local competition is pricing specific items, there are a number of ways to access information to support your competitive analysis.