Ok, you’re almost ready for your practice challenge. Here’s a few tips on what separates the best competitive analyses from the ones that are just good:
1. Pick the right competitors. This is not always as easy as it sounds. For example, if you are the product manager for Uber, who are your competitors? The obvious answer might be Lyft and other ride-sharing companies. But if you think from a customer’s perspective, their goal is to get from one location to another as quickly as possible. In their minds, the alternatives to Uber might also be walking or riding a bike or taking the subway. When picking your competitor set, focus on the next best alternatives that a customer would consider.
2. Get the right level of breadth and depth. When doing your competitive analysis, you need to figure out how “wide” and “deep” to go with your analysis. If you pick too few competitors, you won’t get enough insights, if you pick too many, you’ll drown in information overload. I recommend doing a quick scan of a broad range of competitors for your competitive landscape and positioning and then picking a few of the most relevant ones for a deeper dive comparison.
3. Be data-driven and generate insights that go beyond the obvious. Getting quantitative data points for key areas that are important for your product is always helpful. What metrics demonstrate traction? What have competitors done that is unique? What can you learn or bring back to your team that they might not have thought of?
4. Visuals and presentation matter. The best competitive analyses figure out a way to sum up the industry in a way that makes it obvious where the gaps are. Figuring out a good way to visually represent your industry landscape and to categorize groups of competitors in a logical way can really help to take your research to the next level. And if you can present it in a well-formed presentation, even better!
5. Answer the question. One common mistake I see new PMs make is that they focus a lot on doing the research or putting together the doc, but they forget to reflect on the “so what.” When most product teams are looking to do competitor research, the real question they’re usually trying to answer is “How can we differentiate our product in the market?” Make sure you know the question you’re trying to answer and then once the analysis is complete, provide a few recommendations of opportunities or gaps in the market where your product can stand out. For example: “Based on this analysis, I see 3 gaps in the market: XXXX, YYYY, and ZZZZ.”
