Any organisation that could draw customers away from your potential employer is a competitor.
Many graduates research the retailer they are going to an interview with, but retail recruiters often tell us that candidates don’t research the organisation’s competitors sufficiently. If you can show that you’re clued up on the company itself and its competition, you’ll stand out from applicants who cannot talk about where the retailer sits in the marketplace.
In some cases you’ll be asked about the employer’s competition at the application form stage. Otherwise – or in addition – you’ll probably be asked about the competition in an interview. This isn’t a question you can blag on the spot easily, so preparing ahead will allow you to give an insightful answer.
As a result of social distancing measures, you will be likely to conduct your research online rather than through store visits right now. However, this is unlikely to disadvantage you – particularly as other candidates will be in the same boat. You can use the increased news coverage of retailers as they struggle due to the pandemic – or adapt to meet the changing needs of customers – to bolster your research. Make sure you take a look at the social media feeds of competitors, too.
Identify the retailer’s competitors
You need to look at retail competitors on different levels. Firstly, look at the retailers as a whole:
- Identify the like-for-like competition: for example Marks and Spencer, John Lewis and House of Fraser are all large, high street department stores that have an online offering.
- Look at other types of retailers. high street stores and supermarkets offer similar products to the department stores. There are also numerous competitors online, including Amazon and eBay, as well as the product manufacturer’s own website. For example, Benefit Cosmetics' products, which are available in House of Fraser and on Amazon, are also sold on its own website.
Secondly, focus on the particular brands or product lines that you’ll be working with on the job. For instance, if you would be working with a department store’s own womenswear line, then also investigate the competitors’ own womenswear lines.
The types of competitors you choose to think about depends on the job you’re going for, but don’t restrict your analysis to like-for-like. Any organisation that could draw customers away from your potential employer is a competitor. You could research specific competitors for certain product ranges – particularly if you know those you’ll be working with. For instance, WHSmith and Paperchase are competitors when considering the stationary section of a supermarket.
In order to respond with thoughtful answers during an interview, it will help to have conducted in-depth research into four to six retailers.
Do your retailer research
First of all, check out competitors’ websites – both their online shop and their corporate webpages – and become familiar with what they say about their products and values. You can also read about what’s happening with companies on news websites and via their social media accounts. There are also trade press publications that are available in print and online, such as The Grocer and Retail Week, where you can read about topical issues for certain retailers.
If possible, visit the competitors' stores and observe the types of customer they attract, study the products and chat to employees. Ask yourself, ‘Would I buy something from these stores?’ If they sell online, compare your in-store experience with the retailer’s website. Ask family and friends too, especially if you don’t quite fit into the target market of the retailer you’re applying to or if you don’t usually shop in its stores.
Use competitor analysis tools: how to assess retailers using the SWOT technique
SWOT can be used to help guide your research, and draw out considerations that will be useful at interview. SWOT stands for Strengths, Weaknesses, Opportunities and Threats. For each competitor you research, make a few notes on each of the points and take them with you to the interview to re-read before you go in.
For example, if you were applying for a graduate scheme with a large, high street department store, you might ask yourself the following questions about competitors:
- Strengths: Does the retailer have a strong reputation? Does it strike the right balance between quality and price? Is there a strong warranty/returns policy?
- Weaknesses: Is the customer demographic too wide or too narrow? Are the prices being undercut elsewhere? Is the website poorly laid out?
- Opportunities: Could the retailer launch or improve an online store? Could it increase sales by widening the demographic or launching a new line? Could the retailer reach more customers by opening stores in new locations?
- Threats: Does the retailer have to compete with new online competitors? Has there been a decrease in footfall in store? Has the retailer’s reputation been hampered by a recent event in the news?
Click here for examples of retail commercial awareness interview questions and advice on how to answer them.
Use your analysis at interview
How you’ll make use of your research will depend on the question you are asked. Ensuring balance – such as by including both the strengths of competitors and some of the methods the retailer you’re applying to is using to maintain an advantage – might be a strong approach. You might also talk about an idea you have for how the retailer could improve its strategy (provided this is a specific and well-considered point) or how the weaknesses of the competitors could be turned into strengths for your chosen retailer. That doesn’t mean you should tell the CEO how to run the company; it’s about showing you understand the industry and the market and your potential employer’s position within that.