Last updated on
2024年8月22日
How do you conduct competitive analysis and benchmarking for your product?
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The first step is to define your product category and the scope of your analysis. What is the problem you are solving and who are your target customers? What are the main features and benefits of your product? How do you position your product in the market? These questions will help you narrow down your product category and the relevant competitors to compare.
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Always start with where the audience is. Don't assume you can bring the audience to your website, or service, or download the app. Make sure you understand where the audience is, and what are they looking for, and try to disrupt it. I have always made it simple with a simple table of What, Why, Who, Where, When, and How.
The next step is to identify your direct and indirect competitors. Direct competitors are those who offer similar products or solutions to the same customer segment and problem. Indirect competitors are those who offer different products or solutions but still compete for the same customer needs or budget. You can use various sources to find your competitors, such as online research, customer feedback, industry reports, or referrals.
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Look beyond players in your immediate space. This narrow view can be misleading and create blind spots. Imagine music genres: where do you place a band that blends rock with indigenous percussion? The lines blur—contemporary, jazz, fusion? Here's a twist: forget about customers. Who are your non-customers? Why? Someone has this need (right now), and someone else is fulfilling it (somehow). Competition isn't just those in the perceived markets. It's about who's capturing the mindshare (and wallets) of your target audience. In music, podcasts are potential substitutes for your audience's attention. By looking beyond and understanding the choices of non-customers, one can outline strategies that resonate with a broader market and stay ahead.
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Identifying accounts or users within your current customer base who switched from a competitor (especially recent wins) can be a valuable way to gain insight into specific differentiators for those segments. Interviewing these customers will highlight the pain points (eg, poor customer experience, a missing feature, pricing, etc.) they experienced with the competitor, and how your product or solution solved these for them. Extrapolating these into Product Marketing messaging and targeted campaigns can help capture market share from competitors, and improve your win rate in head-to-heads when prospects are evaluating competing solutions.
The third step is to analyze your competitors using a SWOT analysis. SWOT stands for strengths, weaknesses, opportunities, and threats. For each competitor, you should evaluate their product features, pricing, marketing, customer service, reputation, and performance. You should also identify their unique selling points, value proposition, and competitive advantage. This will help you understand their positioning, strategy, and goals.
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Spot on. Just make sure we choose the right competitors. No point of choosing competitors that are considered small or irrelevant just to make things look better. Focus on competitors that are bigger and have a larger market share. Try to find tools and services that can provide an apple to apple. Avoid mixing tools so as to make sure the data is consistent.
The fourth step is to benchmark your product against your competitors using a competitive matrix. A competitive matrix is a table that compares your product with your competitors on key attributes or criteria. You can use a rating scale, such as 1 to 5, to indicate how well each product performs on each attribute. You can also use colors, icons, or symbols to highlight the differences. This will help you visualize your strengths and gaps, and identify areas for improvement.
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Benchmarking strategies : 1. Direct competitor exists : Rating w.r.t. to the key competitors and identifying the lead area. This helps in gauging and marking the differentiation strategy. 2. Breakthrough product (no direct competition): Defining the right basket of competition attribute by attribute is essential
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To benchmark the product it is important to become a user or interact with user who is extensively using our product and competitor products too. To benchmark a product as per industry standards prepare a list of checklist which are as below: Must have features; - features 1 - our product, competitor product - feature 2 - our product, competitor product Good to have features; - features 1 - our product, competitor product - feature 2 - our product, competitor product Value addition features; - features 1 - our product, competitor product - feature 2 - our product, competitor product Price point comparison; - features 1 - our product, competitor product - feature 2 - our product, competitor product
The fifth step is to define your differentiation strategy based on your competitive analysis and benchmarking. Your differentiation strategy is how you plan to stand out from your competitors and attract your target customers. You should focus on your unique value proposition, which is the main benefit or outcome that your product delivers to your customers. You should also consider your positioning statement, which is how you communicate your value proposition to your market.
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Competitive analysis starts with identifying direct, indirect & probable emerging competitors, analyzing their product features, pricing, and positioning. Benchmark key metrics, conduct SWOT analysis, and use insights to differentiate your product and prioritize improvements. Regular monitoring and strategic adjustments ensure you stay ahead in the market.
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Differentiation techniques act as a solid foundation for Unique selling proposition creation ! Furthermore if a differentiated positioning when derived out of unsaid needs is a sure-shot winning proposition!
The final step is to validate and update your analysis regularly. You should test your assumptions and hypotheses with your customers and potential customers using surveys, interviews, or experiments. You should also monitor your competitors and the market trends using tools, such as Google Alerts, social media, or newsletters. You should update your analysis and strategy accordingly to keep up with the changes and maintain your competitive edge.
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Validating your analysis through customer feedback will be the biggest differentiator in having a successful product or not. This needs to be done ideally quickly and depending on the product life cycle, you'll be able to address the biggest customer pain points in current product or the next launch.
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It is important to have opinions from other stakeholders when doing the competitive analysis. Do take the lead in putting the strategy and the structure (What, Who, Why, Where, When and How) but don't assume you can get the data on your own. Get the digital marketing, technical, creative, and content teams involved. Their insights will add data points to help build up a better insight.
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In addition , we must Keep an eye on emerging competitors and disruptive technologies that may impact your market position and Monitor industry trends, regulatory changes, and macroeconomic factors that could influence competitive dynamics.
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