Boosting E-Commerce Performance with Competitor Analysis

Most of us buy something online every week. Most businesses that provide services or sell products today do so, at least partly online. To say that e-commerce has revolutionized the exchange of goods and services is the same as to say snow is white. Online stores are amazingly convenient and provide many features physical stores can’t. Features users come to expect, like personalized marketing and on-demand support. Of course, some items you want to see and feel physically before buying, but even then, an online store often serves as a convenient catalog you can browse anywhere, anytime. Entrepreneurs benefit greatly from e-stores, considering the comparative fractional cost they need to keep running compared to maintaining and managing physical facilities.

However, being successful in e-commerce is becoming increasingly difficult due to astonishingly fierce competition. In today’s market, having a good product won’t get you very far if your competitors are better at using data-driven technology. Data to e-commerce stores is like oil to cars. It allows entrepreneurs to perform a highly detailed competitor analysis: tracking competitor pricing, product offerings, and marketing strategies. And that is precisely what this article will be about leveraging technology to enhance one’s e-commerce performance with competitor analysis. As data is a prerequisite to employing these strategies, we will explore the most common data collection methods and why businesses often use a proxy service. If You are interested in e-commerce, keep reading, this will be informative and interesting.

Data Gathering Techniques

Competitor analysis requires a wide array of different types of data, like product price, stock, listings, and customer sentiment. The most common way to gather this data is web scraping. As it’s running, however, it generates a lot of traffic. To avoid this problem, a proxy service is often used, allowing scrapers to bypass various IP-based restrictions like blocks or CPATCHAS. This is a program that simply extracts and systemizes data from websites. You can think of many employees entering a website and then writing down product prices, listings, and other information based on a set of guidelines. Of course, no humans can approach the data extraction speed that scrapers can. They can run endlessly, providing a continuous stream of real-time data.

APIs are another common way of getting data. Especially useful for smaller businesses who can’t yet afford to build their own data extraction tools. Application program interface (API) acts like an intermediary, allowing different software systems to communicate, making data integration easier. Many e-commerce platforms provide APIs that enable businesses to pull data about product prices, stock levels, and item listings directly from their systems. Pulling data is a good way of streamlining the data collection process without having to make your own tools; however, they won’t be as tailored and won’t provide as big of a variety of data as you might need. A proxy service might also be handy when pulling data from APIs, for example, if an API is region-locked.

Competitor analysis

Competitive analysis is a vital point of consideration when making strategic business decisions. Now that we covered the main ways how data is gathered, let’s take a look at some techniques businesses use to get a competitive edge.

Product Pricing

Competing on price is the most fundamental way to gain an advantage. However, it has a few caveats. For products that are very niche or are targeted at an audience that does not consider price as one of the primary factors for buying something, it can take a back foot. However, most consumer products must strike a good balance of price and quality to be considered a good product. E-commerce stores are able to continuously monitor and adjust prices. Multiple stores selling similar or even the same items will usually stay within a very close price range on those items, making continuous micro-adjustments based on their competitor’s moves. Of course, price is rarely considered just on its own. If an e-store has some desirable extra features, like a deal with courier service that makes shipping faster or cheaper, better customer service, or better-personalized marketing, higher prices on the same product can be warranted. That is why product price, while being important, is not the only variable to consider.

Product Offerings

Several substantial advantages can be gained by analyzing your competitor’s inventory. This allows you to profit from potential mistakes or shortcomings your competitor might have. For example, you might notice a product your competitor doesn’t yet have and be the first to sell it. Similarly, you can find products you don’t but should have, thus minimizing the need for your customers to browse elsewhere. Monitoring your competitor’s stock amount is also advantageous. You can ensure you always have the product in stock, again minimizing the need for your customer to go elsewhere. Monitoring inventory levels also enables automated price adjustments based on supply, if your competitors don’t have the product, you can increase the price.

Market Strategies

Another critical point to analyze is your competitors’ market strategies. Market strategies encompass everything from promotional tactics and branding to customer engagement and loyalty programs.

Promotions are one of the most direct ways to attract and retain customers. By tracking how and when competitors offer discounts, deals, and special offers, you can adjust your promotional strategies to counteract or “jump on the bandwagon” when it makes strategic sense.

Advertising strategies can be amazingly diverse. It is, however, difficult to follow your competitors. Generally, it’s a good idea to track your competitors across different channels, like search engines, social media, search engines, email marketing, and even traditional media. You can even judge their success by scraping social media platforms to see the general opinion on the campaign. This information is invaluable. Following your competitor’s advertising strategy opens up great opportunities to counter and in rare occasions, deal a critical blow to their brand image.

Conclusion

In conclusion, leveraging technology and data-driven strategies is essential for gaining a competitive edge in e-commerce. Competitor analysis, powered by data gathered through methods like web scraping and APIs, often helped by a proxy service, allows businesses to fine-tune pricing, expand product offerings, and optimize marketing strategies. While the competition is fierce, those who effectively harness data and adapt to market trends will be better positioned to keep growing, especially if you have a mature e-customer base.