How to Use Competitive Benchmarking to Your Advantage
Competition is one of the biggest motivators for online retailers, especially as e-commerce sales keep climbing. Regardless of whether another company offers the exact same products you do, there are hundreds of thousands of other companies competing for your target market’s attention and money as well as training your customers on what to expect. That’s why it’s so important to have competitive edge.
Some companies aim to gain a competitive edge through pricing, some through convenience, and some through brand personality. However, more and more e-commerce companies are competing on customer experience (CX). They understand that their competitors are constantly setting and raising expectations for consumers.
Today's consumers have more power than ever before. With online product reviews, social media recommendations and chat support at their fingertips, smart shoppers know that they don’t have to settle for a company that provides a lousy experience. If customer support staff are rude or unhelpful, if a website doesn’t work properly on the device of their choice, or if they can’t quite find what they’re looking for, the competition is just a click or tap away.
At the beginning of 2015, Gartner predicted that customer experience would be the new battlefield for otherwise equal companies. Businesses that go out of their way to help each customer will earn more respect, loyalty and revenue than their competitors.
Investing in improving your CX is a huge key to success. If your customers think you’re providing an excellent experience, you’re already ahead of 99 percent of other companies, according to Forrester.
But how do you actually know if you’re providing an excellent experience? And what about your competitors? The way to answer these questions is through competitive benchmarking.
Competitive benchmarking allows you to track your progress on certain criteria over time in comparison with your top competitors. You can use customer satisfaction surveys or user research studies to measure and benchmark your CX.
A few key areas to evaluate include the following:
- ease of use of website;
- company credibility;
- aesthetics and brand appeal;
- speed of website and service; and
- overall customer satisfaction.
Have a sampling of customers evaluate your company on its performance in each of the areas you choose. The average of these ratings will be your initial benchmark. Then, pick one or two top competitors and have the same number of customers evaluate them on the same areas. It’s important to keep the questions and the number of participants standard.
In order to track progress over time, you’ll need to run the same research every month or quarter. The key is to set a schedule and stick with it, and to make sure not to change any of the questions in the survey or study.
The results will show trends you can track at a glance. If your company or a competitor makes any major changes that impact the customer experience, you can examine how that change impacts overall customer opinions of the company. You can also share results with stakeholders in your company to gain support for proposed CX improvements.
Tracking changes in your CX over time will help you determine whether your improvements are effective and set a plan to surpass your competitors. By paying attention to what works and what doesn’t as you implement CX fixes, you can identify new opportunities to earn customers’ business and loyalty.
The majority of retailers haven’t quite figured out the secret to providing an excellent customer experience. That means now is the right time to start getting ahead of your competitors on the customer experience front. By measuring your customer experience now and making incremental improvements over time, you're making an investment in your company’s success for years to come. Keep track of the score and you’ll be able to tell whether your company is winning.
Maggie Young is the vice president of customer success at UserTesting, a user experience testing platform..
