Competitive Analysis is something that every organization carries out either formally or informally. As a Product Manager, the information gathered during the process of carrying out competitor analysis is vital to successfully carrying out your brief.
Competitive analysis concerns itself with analysing your business, its product and product lines versus those of your competitors and potential competitors in the market place.
Before you get started on fresh analysis, it is important to find out what your organization’s position is on competitive analysis. At larger organizations, you might even find out that there are one or two departments already tasked with this data gathering. If there are, make sure that you interact with them and obtain as much of their data as possible. You may even be able to get access to their libraries of industry subscriptions (electronic and paper).
If there is no formal competitive analysis carried out or it is not updated or reliable, then you need to put your own process in place. It can be as simple as a spreadsheet with ancillary evidence.
You are basically going to build a profile for each of your competitors which you will compare to a profile of your own organization. This will help you to monitor all sorts of data such as your products performance versus theirs; your market share versus theirs; your products features versus theirs and so on.
You will also carry out a SWOT analysis to determine your respective strengths, weaknesses, opportunities and threats.
How to Perform Competitive Analysis
So where are you going to get all of this information from? First, identify all of your current competitors and any potential ones on the horizon. Armed with this information you then need to:
Talk to the members of your cross-functional product team they will be able to fill in all sorts of gaps in your data because they interact with the product, customers and competitors from different perspectives than you do. For example, the development team will probably be able to shed light on technical data; customer services may have information about their customer service/customer satisfaction levels and finance may already have an insight into their financial data and industry standard ratios.
There is a vast array of competitive intelligence all around you from media scanning, networking at various events, going out and looking at the products in action, speaking to customers, and speaking to suppliers. You can ascertain all sorts of information from these areas. Information like marketing budgets, target markets, market segmentation and pricing strategies.
Publicly available information is a great resource. From their annual accounts, you can determine their profitability, their staffing levels, their cash flow, and many other details of their operations. You can also obtain additional data from regulatory or governmental reports if you are in a regulated industry.
One word of caution is that you make sure that all information that you obtain is obtained ethically. Information is so readily available that there is absolutely no need for underhand tactics. You will just end up damaging the reputation of the organization that you work for and the product.