Competitive Benchmarking Strategies for an Automaker
About the Client
For over 7 years, the client has been a leading automotive manufacturer serving customers throughout the Western United States. With a workforce of 470+, the company was looking to expand its access to new market segments.
The Business Challenge
Companies in the US automotive industry are facing a period of rapid competition and capital spending in their effort to compete with other automakers from across the globe. Moreover, with autonomous technology entering the market, automotive manufacturers are facing safety issues, fierce competition, and a shift in their business models. This coupled with the adoption of autonomous technology by top competitors has increased the pressure on automakers to innovate, understand competitors’ key strategies, and develop a competitive benchmarking strategy to accomplish their business goals.
The business case: Infiniti Research was approached by a major automotive manufacturer who was looking to gain a fair perspective on how well they performed compared to other organizations in the automotive industry. In addition, the company encountered a decline in its sales rate for its automotive products and wanted to improve its market share by understanding the potential game-changing efforts and initiatives undertaken by its competitors.
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Top Challenges Faced by Automotive Manufacturer
Problem Statement 1: Revenue loss
The client’s unstructured approach to competitive benchmarking and their failure to identify competitors key marketing strategies resulted in revenue losses for the company, leading to a sharp decline in their market position. With the help of Infiniti’s competitive benchmarking solution, the client wanted to continuously improve the quality of their products and services by scrupulously monitoring the initiatives undertaken by their competitors.
Problem Statement 2: Retaining profitability
Owing to commodity price shifts and dynamism in the market, the automotive manufacturer found it challenging to retain their profit margins. By leveraging competitive benchmarking practices, they wanted to develop a standardized set of processes and competitive benchmarking metrics.
Problem Statement 3: Increasing productivity
By analyzing the sales rate of competitors, the client realized that implementing the latest automotive technologies was the key to success. Hence, by leveraging a competitive benchmarking strategy, the client wanted to gain valuable data on the current technologies and processes followed in the business environment for increasing productivity, while reducing costs.
Problem Statement 4: Identifying performance gaps
With the aid of Infiniti’s competitive benchmarking analysis, the client wanted to drill down into performance gaps to identify areas for improvement.
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Solutions Delivered and Value Offered
By analyzing the industry challenges and requirements of the client, the experts at Infiniti Research developed a plan for effective competitive benchmarking analysis. The competitive benchmarking process revolved around the following phases:
The initial phase of the competitive benchmarking process involved conducting extensive researches to gain an understanding of the key competitors of the client.
The second phase revolved around categorizing the key competitors based on competition – direct, indirect, and substitute competitors.
Direct competitors – Companies that offered the same portfolio of services and products to the same target region as the client
Indirect competitors – Companies that targeted different clientele within the same business space
Substitute competitors – Companies that offer different products and services to the same target customers as the client
The third phase after categorization of the key competitors involved analyzing common marketing patterns and competitors’ weaknesses to help the client differentiate themselves by offering products and services that fill gaps that their competitors have not addressed.
By leveraging market information and data obtained from competitors, a competitive benchmarking framework was devised, which included detailed company profiles and analysis of current activities and future industry developments of all the top competitors.
The competitive benchmarking framework helped the client to analyze competitors in terms of market penetration, product and market development, and clearly illustrated their market positioning in the target markets.
With the help of a comprehensive competitive benchmarking process, the experts at Infiniti Research helped the client assess the market opportunities in the focus geographies. The further helped them reveal all hidden opportunities in the market. Infiniti’s competitive benchmarking analysis also helped the client differentiate their business from other players in the automotive market. Moreover, recognizing a competitive advantage further helped them create a new marketing strategy and brand image by relying on the key differentiators.
The competitive benchmarking process also helped the client to:
- Improve the quality of their services and products.
- Increase productivity while reducing cost
- Prioritize the areas of improvement
- Improve their performance standards to stay relevant in the market
Lack of competitive benchmarking strategies can result in huge losses in sales, leading to a sharp decline in your market position! Well, look no further, Request for a FREE proposal today!
What is Competitive Benchmarking?
Competitive benchmarking is the process of analyzing a company’s performance with that of its competitors in the industry using a set collection of metrics. Using competitive benchmarking analysis, not only can firms get an organized overview of their company and how it performs on different levels, benchmarking can systematically reveal performance gaps and improvement opportunities and highlight competitor strategies that need to be countered. Competitive benchmarking is a common practice to establish baselines, define best practices, identify improvement opportunities and create a competitive environment within the organizations.
What are the steps in a competitive benchmarking process?
For companies looking to build a robust competitive benchmarking framework, here are certain steps that you must follow:
Set clear goals – Businesses need to make smart decisions about their business goals.
Identify the data source – Businesses must identify the sources for the data that they want to gather for competitive benchmarking. It is vital to keep the data consistent. While choosing external sources of data for the competitive benchmarking framework it must be ensured that the data is consistent.
Set regular intervals of measurement – The time intervals at which an organization must undertake competitive benchmarking solely depend on the activities and benchmarks that they are focusing on. It is up to the organization to determine what the most appropriate interval is for the benchmark and for the business.
Implement plans and monitor results – The final step in establishing a robust competitive benchmarking framework is to execute the set processes of measuring performance and identify the deviations.
Benchmarking competitors remain to be a major challenge faced by players in the automotive sector. Our competitive benchmarking solutions simplify the entire process. CONTACT US to know more about our services.