When we get data back from the market place, we conduct the analysis and then put it into a format that is easy to see. This format is called a competitive profile.
Below is a study and a competitive profile from rural India on a fertilizer called urea. CO1 is your company and the other companies are shown as CO2, CO3, and CO5. We can compare CO1 (ourselves) to the industry. We usually prefer not to. Why? Because the industry includes us (and we do not need to nor want to compare ourselves to ourselves and the industry data includes us). So we compare ourselves to the other competitors (or others, which is the industry data without us). The ratio of CO1/competitors or CO1/others tells us how we rate versus competition. The competition’s score is the weighted average of the scores of CO2, CO3, and CO5.
But even more important, we can see how one of our competitors CO2 compares to its competition (which is the weighted average of ourselves (CO1), CO3 and CO5). This tells us more about CO2. This tells us how CO2 would look at the data had they commissioned the study, and so we know as much about them as they would, had they carried out a CVA study.
Next we can compare ourselves versus any of the competitors such as ourselves CO1 vs CO2, or CO1 to CO5. This is a one on one comparison.
The reds in the chart in the ratio ../competitors for CO1, means CO1 is worse. Under the column CO2, the reds mean CO2 is worse.
And in the last set of columns, it is CO1 versus CO2 or CO3 or CO5, and reds mean we are worse. The yellows mean we are about the same and the greens mean we are better.
Next you should notice that price is only 36% in importance, and image is 43%. Benefits are 20% and in the benefits the product itself has very little importance (3%). Remember that most product centric companies focus on the product even if it has low importance in the eyes of the Customer. Why is the importance of the product low? This is because the Customer sees very little difference between the competing products available to him.
The next chart shows how the image breaks up into the company image, trust in the company and the brand of the urea. The social status the brand gives the farmer also builds the image. You can readily see that the company image and trust make up 43% of the image and the brand only 25%. CO1 (ourselves) are worse than industry (we do not want to compare ourselves to industry but to competition). We are also worse than competition in image, CO3 and CO5 being superior to us.
You can see how powerful a Customer Value Added study can be. By using competitive profiles, you can study yourself against competition and to each of your competitors, or versus an individual competitor. You can see how a competitor would view itself if it had this data. Moreover, you can see what a competitor would opt to do or what strategy the competitor would adopt to improve, and you can pre-empt its moves. You can discover and decide what you would want to do. You will also note that what you might think is important may not be important to the Customer or vice versa. This will change your thinking radically.
Do it Yourself
Draw a competitive profile for your product/service. See where you stand and what is important to the Customer.
What would you do to improve? Whom do you want to compete with?
Is your thinking different from the Customers?