Allume Group

Think you know your brand’s competitors online?

I consistently hear large, established consumer brands refer to other large, established consumer brands as their biggest online competitors. However, the data shows the opposite – the in-store leading brands aren’t always the leading brands online. Instead, eCommerce provides a favorable battleground for insurgent brands.

These disruptive brands start small and grow large. They’re nimble. As I’ve written before, they understand the value of product reviews, SEO content, advanced digital advertising strategies, and social media. They’re solving consumer problems in new ways. They’re gaining customer loyalty in a time when brand loyalty is at its lowest ever.

As our retail consumption environment is rapidly changing, we’re seeing  significant shifts from brick and mortar to eCommerce. What’s more, to really understand these shifts, you must also recognize how to define “like” products on Amazon. How is the customer searching for your products on Amazon, and what products are presented to them?

Consumers’ Definitions Matter

 How do you define a product category in eCommerce? How do you define a brand in the digital environment? In a world where categories follow the customer and dynamically adapt, and brands are defined by reviews, a new approach is necessary for survival.

According to Jeriad Zoghby, Global Lead of Digital Marketplace Services at Accenture, “The strategy of digitizing the physical shelf is dead. The category now continually adapts to match the customer’s evolving needs.”

If you’re still looking at traditional brick and mortar categories, market share, and established brands as competitors and measurements of your business, you’ll be left in the dust.

 Scared yet? Leading brands should be, and here’s why:

Categories are dead, long live e-Categories

 In current marketplaces, categories are dead, or at least, they don’t look how you’d think. A recent search for “peanut butter” on Amazon yields 48 search results, half of which are either not peanut butter (crackers, cookies, candy, etc.) or are not nationally known brands.

If you think these out-of-category and category-adjacent products aren’t your competition, think again. Amazon’s algorithms surface products most likely to win conversions. You need a means to define and measure your “e-Category”. Identifying a collection of search terms that map to your products, finding a means to measure your performance across that set of terms in search results, and benchmark against your e-Category peers will help you successfully compete for share of wallet.

For example: if you sell organic peanut butter, perhaps your search group contains the terms “natural peanut butter”, “natural crunchy peanut butter”, “organic peanut butter”, and “organic crunchy peanut butter”. These terms make up your e-category. Next, identify the key competitors based on who turns up in search results – including out-of-category and category-adjacent brands. These are your search competitors. Lastly, search strategies (paid and organic) to continue to win a greater percentage of the search results and track your progress over time.

Reviews often matter more than brand loyalty.

54% of online buyers read reviews before purchasing. Despite some fake reviews on Amazon, customers shop by review counts and star ratings…often secondarily to brand recognition or affinity. When seeking curation online, customers now turn to social and influencers.

If you’re counting on years of building your brand equity to carry you through on marketplaces, you’ll need a new strategy.

The customer shops differently online (they search, they don’t browse).

Customers don’t shop by category on eCommerce marketplaces the way they do in brick and mortar stores. Instead, they browse for products online. 87% of shoppers now begin with online search, vs. navigating a site by product category. 75% of people never scroll past the first page of search results, typically buying from what’s presented to them.

For this reason, your “search peers” are your new competition. Finding ways to measure performance in search relative to your competition is critical to brand survival. 

Key takeaways

In conclusion, it’s time to let go of outdated thinking that’s based on how customers shop in brick and mortar stores. Your competition, customers and sales are being defined through search. Online marketplaces are creating new metrics and better ways to identify, reach and convert. Brands that ignore this new reality do so at their own risk.