I recently did a Competitive Landscape analysis for NewEgg. The Executive Summary is below, and I think it is a pretty good read if you have ever been a NewEgg, Amazon, or eBay customer. If you are interesting in how to performance the analysis in detail, shoot me an email at: mario dot j dot campos at gmail dot com
Short Executive Summary
Analyzing one’s competitors is both a beneficial and necessary part of business. Electronic businesses are no exception, and evaluating their online presence in relation to competition can reveal startling truths about what battles you are fighting and where you are fighting them. This report profiles the e-commerce company Newegg, which sells a wide variety of electronics while emphasizing their personal computer component roots.
Newegg’s top ten competitors are analyzed, and their relation to the company may be surprising to a reader that assumes Newegg is still primarily competing with computer component e-tailers. In fact, besides mainstream desktop and laptop manufacturers, Newegg has no major competitor that focuses on the PC component market. Their competition is as diverse as Ebay to Wal-Mart and many companies in between.
Three chief findings are available from this competitive landscape profile. The first is that Ebay is Newegg’s top competitor, beating out a host of other companies, even Amazon.com. Second, Newegg is no longer a boutique PC component seller. It is a fully-fledged electronic e-commerce website. Lastly, Newegg’s web traffic comes almost entirely outside of its competition and so cannot merely ‘soak up’ the traffic from users that are unsure of which to choose. Newegg is the undisputed underdog in its competitive field.
To respond to the threats in this landscape, Newegg should instigate a three-pronged approach to defending its territory, expanding its user base, and increasing its profitability. First, Newegg should launch an e-marketing campaign aimed to boost it over Ebay in terms of safety, security, warranty, refunds, and customer service. Second, its mainstream non-PC component electronics should be advertised to purchasers of such products as DVD players, digital cameras, and TVs. Finally, Newegg should launch an online music and DVD distribution service to get a cut of the lucrative downloadable content marketplace. By establishing itself as an early key player, Newegg will be ready as consumers keep steadily switching to digital media.
These findings and recommendations are available to make Newegg more competitive and better able to defend its territory against in-roads from its competition. Newegg has the ability to continue to expand, both in terms of profitability and consumer demographics. The three recommended initiatives will set Newegg up for future long-term growth options while retaining their core spirit of enthusiast personal computer components.
References
Alexa. (2008). Retrieved April 13, 2008, from http://www.alexa.com.
Newegg. (2008). Retrieved April 13, 2008, from http://www.newegg.com.
