Mitigating measurement myopia: The renewed importance of competitive intelligence 

DMPG managing director James Wawne urges for marketers to take a look beyond the boardroom for a more rounded strategy.

There can be few people left in marketing who are not tired of hearing about the pandemic, the impact it has had on business, and the changes in consumer behaviour as a result.

However, there has been limited discussion around one particular pandemic hangover that will remain with us for some time to come: the intractable problem of performance measurement in the wake of COVID-19.  

Year-on-year comparisons for internal key performance indicators (KPIs) have long been a mainstay of performance evaluation for product owners, analysts, and marketers. But, against a backdrop of volatility and changes in underlying dynamics, they can prove problematic at best and misleading at worst. 

As data-driven decision makers scramble to gauge their performance across sales and marketing, they are in desperate need of additional context to answer the key question of what ‘good’ looks like now. 

This can only be answered by introducing external comparators and creating a wider frame of reference to benchmark themselves against. It’s essential for companies to go beyond navel-gazing in first-party data and begin to overlay relative performance comparisons which incorporate competitive intelligence data.

Competitive intelligence can be defined broadly as any activity that gathers, analyses, extracts and distributes insights relating to the external competitive environment a business operates in; including competitors, products/services, and consumers.  

There are three broad areas within competitive intelligence which the majority of research seeks to measure and understand: 

  1. Direct competitor performance and industry trends
  2. Indirect and potential competitor performance and adjacent industry trends 
  3. Consumer behaviours and trends 

In the context of digital and marketing, competitive intelligence can include a vast array of data sources and toolsets. High-level KPIs might include engagement metrics, conversion rates and repeat visitation or wider-lens measures such as share of market, audience overlap. Lower-level KPIs can include traffic geo split, page or section popularity and acquisition channel composition to name a few. While many of the metrics will be familiar, it is worth reiterating that these are taken and used alongside first-party data. 

Competitive intelligence data provides an unflinching view of how you ‘stack up, and provides perspective when internal metrics are skewed by unprecedented events or rapid change.  

Take a look at a couple of real-world examples. The first illustrates the importance of understanding relative performance in high-level KPIs. A recent performance analysis of a company within the retail sector revealed that their headline year on year traffic growth was 23%. On the face of it, you could be forgiven for thinking that this performance is pretty strong. However, when comparing the growth rate with its nearest rival using data from a competitive intelligence solution, a different picture emerged. 

24 months of data taken from a leading competitive intelligence platform shows (left to right) 1. Absolute traffic volumes 2. Relative YOY growth index 3. client share of traffic. [click to enlarge]

These three charts show that the growth of both companies is trending up (left) but the competitor grew faster (middle-orange) achieving 52% growth in the same period. The client has been losing ground in real terms (right) with the trend showing no sign of abating. So despite having ‘record growth’ in the wake of COVID, the analysis reveals that the client needs to quickly dig deeper to understand the main drivers, and take corrective action.  

A second example comes from the financial services sector. There are few better examples for the importance of monitoring adjacent industry trends and shifts in consumer behavior than the recent meteoric growth in buy now, pay later (BNPL) that caught many traditional players in the financial services sector by surprise. 

A revealing analysis published by leading competitive intelligence platform Similarweb showed how the top four Australian banks offering credit cards saw signup volume decline slightly between 2020 and 2021 (-2.6%) as compared to the top four BNPL players who achieved +20.5% growth. The research went on to reveal that 31.5% of the BNPL growth was driven by fashion and apparel sites and furthermore, millennials accounted for a third of that traffic. 

For retail e-commerce, this example highlights the importance of understanding adjacent industry trends (in this case, payments) along with the associated shift in consumer behaviours where uptake among particular demographics may deliver disproportionate business value. Retailers targeting millennials should, for example, include a range of BNPL options in checkout to avoid leaving money on the table.  

The bottom line: marketing leaders need to ensure that they do not focus overly on internal performance measures or they risk missing important signals that demand action. Ongoing investment is required too, beyond tools and data, to support marketers in producing and driving competitor and consumer insights into business decisions. Proactive education of stakeholders outside of marketing and digital is needed across organisations to expose the value potential of competitive intelligence in mitigating measurement myopia. 


James Wawne is the managing director of DMPG.


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