“When you are content to be simply yourself and don’t compare or compete, everybody will respect you.” –Lao Tzu, founder of philosophical Taoism
While this is advice to consider from a personal perspective, performing regular competitive comparisons is a common and necessary business practice. Successful businesses regularly evaluate their business performance, including product and service performance, to that of their competition to identify areas of strength and improvement as well as future opportunities. This competitor comparison includes obtaining critical feedback from customers and, in many cases, other business stakeholders, often through formal customer experience measurement.
But what is the best approach to compare your brand or company with another?
I recently had this conversation with a health insurance client for which we conduct business performance research among a variety of customer and stakeholder types. For the purposes of this discussion I’ll call them Company Y. In the research, we ask customers to rate two insurance companies they have experience with (Company Y and a competitor they also currently do business with), thereby providing the ability to compare performance.
In reviewing comparative results, Company Y wanted to know if they should use aggregate ratings of their company when comparing to each competitor or if they should carve out and compare only those customers that rated both companies (a series of distinct respondent sets and analyses, one for each paired comparison).
The answer is: “it depends on the breadth of the customer or stakeholder’s experience.” When considering this type of analysis, you should ask yourself the following:
Depending on the context that the customer or stakeholder is operating in, the audiences included in the analysis should be considered and adjusted to match that particular experience. If the respondent is likely to have a broader view of the competition, use an aggregate approach to your analysis; if the respondent has a limited view, use a carve-out approach.