You may not have to be that much better

Posted by Dave CollinsDigital Marketing

Why do Google keep updating Analytics on an ongoing basis?

It’s not just about keeping up with new technology, and it certainly goes a lot further than cosmetic changes.

So why do they invest an immense number of developer hours into something that is not only free, but has almost no competition?

It’s all about tiers.

Every market has different levels of competition, ranging from the “King of all they survey” all the way down to the “Why do they bother” at the bottom of the barrel.

Tier 1 – basic competition

In some markets this may be the most crowded level. Lots of products all jostling for space. To all intents and purposes they don’t really compete, they just exist.

Tier 2 – better

These are the products that compete with the others on one main factor. For example they may be cheaper, faster, smarter, lighter than the masses below them.

Tier 3 – better than most

The products that are better than their closest rivals on more than one level. They may, for example, be cheaper and easier to use, or lighter and stronger than the lower tier.

Tier 4 – significantly better than most

Products that are significantly better than almost all of their competition at almost everything. Products in this category may be cheaper, faster, better quality, more reliable and more desirable than their competitors.

Tier 5 – the best

This product (or occasionally products) will usually be much better than all of their competition in almost every way. In a sense they have no real competition.

Any products or services you can think of will fit this model – foods, text editors, power tools, electronic hardware, phones, accountants, paint, paper, wine, batteries and more. All of them have their earned and just place in their market.

To some extent, there is movement between the tiers, but the higher the tier, the more difficult it is to ascend. So jumping from the first to the second tier could be as simple as being cheaper, or more efficient for example. The other side of the coin is that there may be one single differentiator means that the tier two product could quickly find themselves sliding back down.

Make the transition from tier one to three, however, and not only will the product face less competition, but their place will be more secure.

It only really starts to get interesting at the highest levels. Many markets will see one single product or company in the top tier, and the chance of a tier 4 product taking their place is incredibly slim. Not impossible, but unlikely.

Yet in order to maintain their position at the top, the tier 5 company only needs to keep the gap between them and tier 4 wide enough so that no-one can cross it, and no more. In other words the company at the very top needs to make sure that they are massively better than any of their real competition. But there’s nothing to gain beyond a certain point. Far enough that they can’t make the leap is far enough.

Going back to Google Analytics, there are of course many alternatives, but how many of them are free, easy to use, scalable, reliable, require no expertise to install, work on all platforms and can be used by almost anyone anywhere?

So what would it take to compete with all of the above? More than any company can justify investing; for now.

As long as Google keep the gap between Analytics and their competition long and deep enough, and maintain it so that it just works, nothing will change anytime soon either.