How to Complete a Comprehensive Competitive Analysis

Contents

You will learn how to conduct a competitive analysis by reading this guide, which includes the following steps: understanding market trends; identifying your competitors; evaluating opportunities; analyzing threats to your organization; and adjusting your go-to-market strategy and positioning strategy accordingly.

Introduction

The Foundations of Market Research and Analysis, Part 1
What exactly is an analysis of the competition?
Why Should You Conduct an Analysis of the Competitive Landscape?
The Improper Application of a Competitive Analysis
How to Pick Out Competitors for an Evaluation is Covered in Part 2
Methods for Choosing Which Competitors to Analyze
How to Carry Out an Examination of the Competition (Part 3)
An Overview of the Company
Analysis of Going to Market (Customer Acquisition Analysis)
Product Presentation and Pricing Model Channel Customer Experience and Successful Business Relationships with Customers
The Instruments, Sources, and Methods Available
Part 4: The Steps That Come Next
Summary
Check out my training on how to successfully conduct interviews with customers.

Introduction

It’s not just you if you feel that everything in the SaaS world is a jumble these days. The number of products and services that are provided via SaaS has increased. There is now more competition within each product category. Many of its features and functionalities have begun to be redundant with one another. The economy based on subscriptions has made it simpler to switch to items offered by competing companies. The business environment has evolved into one in which “the winner takes all” and fierce competition are the norm.

Every day, new product categories are introduced, and the distinctions between more traditional categories and labels are starting to lose significance in the eyes of consumers who are primarily motivated by the need to find a solution to a problem. Because consumers now have access to a wider range of options than at any other time in history, it has become much more challenging to maintain a lasting edge in the market.

As of the year 2017, there are more than 5,000 goods in the martech sector alone that are competing for business in ways that are convoluted and overlapping. Certain businesses expand into new markets by utilizing their existing expertise and resources. Consider Salesforce as a good example; just look at all of the many martech categories in which it is included. Because there is so much competition, software as a service (SaaS) providers cannot succeed just based on the characteristics of their products; rather, they need to succeed based on their brands and the experiences they provide their customers.

It has also become exceptionally challenging to differentiate between direct competitors and indirect threats; when this distinction is made, one discovers that rivalry frequently arises from unexpected quarters. In point of fact, indirect competitors are becoming an increasingly significant source of competition in the software as a service (SaaS) and technology industries. These firms’ fundamental technologies allow them to expand into neighboring verticals and industries.

Amazon was brought up by senior executives on earnings calls at a rate that was over three times higher than that of any other company between the years 2016 and 2017. It should come as no surprise that top executives at publicly traded companies are fixated on the retail titan. Even the possibility of Amazon entering the market might cause a dramatic upheaval in the industry, which would immediately put them out of business. To put it another way, the world of SaaS advances at a rapid pace, and the only way to keep up is to stay one step ahead of it.

How to Complete a Comprehensive Competitive Analysis

An effective plan for going to market can benefit greatly from the following intelligence in the following ways:

Conducting research can assist in guiding your company in the direction it should go in the market.
Conducting research can assist you in determining the most direct way to move forward.
Through research, you may be able to discover openings and gaps that have been neglected.
The Foundations of Market Research and Analysis, Part 1

1. What exactly is meant by the term “competitive analysis”?

A competitive analysis is the process of identifying your competitors and assessing their methods to evaluate their strengths and weaknesses in relation to your own company, product, and service. This is done as part of the process of determining who your competitors are. The purpose of doing a competitive analysis is to obtain the essential intelligence in order to discover a strategy of attack and establish a plan for entering the market.

2. The Reasons Behind Why You Should Execute a Market Analysis

There’s a proverb that goes, “Keep your friends near, but keep your enemies even closer.” You’ve probably heard this one. That is not the whole story when it comes to performing a comparative analysis of SaaS providers, though.

Keeping your adversary near by in the software as a service industry will not protect you from being ambushed. There are instances when you are not even aware of who your adversaries are. After all, your “rival” could be bought out by Amazon at any moment, putting you out of business immediately. Alternately, Google might decide to enter your industry with a product that competes with yours.

The following are some of the reasons why you should perform a SaaS competitive analysis, sometimes known as “studying the opponent.” Researching the “enemy” can assist one gain a better understanding of the battleground. It might assist you in determining where your “enemies” are located and how they approach the business from their perspective. It has the potential to assist you in locating key critical areas in which you can place yourself in a winning position.

You won’t gain any insight from doing a competitive analysis into important business decisions, such as which product feature to develop next. Never imitate your rivals just for the purpose of imitating them; they could be completely winging it! In addition, if you are at the forefront of your sector, the usefulness of conducting an analysis of your competitors is diminished because you are the one driving the pack into unexplored ground.

However, it will assist you in developing a go-to-market (GTM) plan that has a significant impact.

Get a grasp on the current market conditions.
It is unusual for a company to compete against just one other company. In point of fact, in many instances, the most significant level of competition in the software as a service (SaaS) and technology industries comes from indirect competitors. These rivals have achieved a dominant position in their primary market, which has enabled them to broaden their operations into a variety of verticals and industries. Who could have predicted that Uber and Google would become two of the most formidable competitors in the market for autonomous cars? It is quite difficult to differentiate between direct and indirect competitors in the sales enablement and acceleration industry, as I mentioned earlier in my analysis of the market for these services. Everyone competes with everyone else in many different SaaS categories.

Identify Strengths and Weaknesses

Your company’s advantages and disadvantages in contrast to the other options can be more easily identified with the assistance of a thorough competitive study.

You need to have a solid understanding of both your ideal consumer and the market before you launch your product in order for it to be positioned appropriately in the ecosystem of all other products and services. In light of the fact that competition might arise from any source, you need to make a list of your advantages and disadvantages in comparison to both direct and indirect category leaders (i.e., those adjacent to your core business).

Design / Adjust Strategy for Going to Market (GTM)
A comprehensive knowledge of your ideal customer, the market, and your competitors, as well as the product offering and price, as well as the channels that are required to reach your clients, is vital for an efficient GTM strategy. An understanding of the dynamics of the market, gained from doing a competitive study, enables you to locate the most effective means of communicating with the consumers you wish to serve. Your company and your product’s place in the current environment can be better understood after conducting research on both the market and the competition in that market.

3. The Improper Application of a Competitive Analysis

A competitor’s approach is not something that can ever be fully comprehended or replicated by you. An investigation of the competition is only one component of your growth strategy, and it is a relatively minor one at that. You shouldn’t seek to your rivals for inspiration regarding their marketing strategies. Even if they are spending thousands of dollars on Facebook ads, that does not indicate that the strategy is successful.

You should also avoid releasing a brand-new feature for the sole purpose of maintaining parity with a rival. You might be astonished to learn that many product decisions are made based on petty internal politics or the opinion of the highest paid person in the company, which is referred to as a HiPPO (Highest Paid Person’s Opinion).

You shouldn’t base your judgments on what to construct next on an examination of the competition. Your business rivals are not going to be the source of your next brilliant idea. It ought to originate from comments left by customers, conversations with potential customers, and ideas that employees within your organization are exchanging with one another.

Research about the industry should be avoided. The bottom of the market is typically not on the radar of industry analysts, therefore they are not very effective at anticipating innovative companies or cutting-edge trends. This is because such developments occur at the lowest point of the market. The consensus of the industry is provided by research giants such as Forrester and Gartner after significant developments have already taken place. In addition, they obtain their study by examining major firms, which means that startups will not discover the information that they are seeking for in this location.

You shouldn’t spend an excessive amount of time on it. Consider your analysis of the competitive landscape to be a secondary effort. It shouldn’t take up an excessive amount of your time or other resources. Pay attention to what your customers are saying you, whether it be through comments, interviews, or even their behavior when using the app. They are always going to be the most reliable source of data and insights for you.

How to Pick Out Competitors for an Evaluation is Covered in Part 2

4. How to Identify and Choose Which Competitors to Analyze

An procedure known as competitive analysis involves comparing your company’s products and services to those of other businesses in order to identify areas of overlap and differentiation. The most important step in getting started with a competitive analysis is picking the correct companies to examine as your competitors. If you do not do this, you will waste a lot of time conducting research on your competitors while gaining very little insight as a result. In other words, the competitors you choose to evaluate will impact how you think of your own firm as well as the outcome of the comparison.

Remember that landscape map of the martech industry with almost 5,000 companies? Nearly every type of product has at least a dozen separate companies that compete in the market for it. You cannot realistically expect to examine each and every one of them. You are exempt from doing so as well. An optimal examination of your business’s competitors would contain between three and five of the organizations that pose the greatest danger to your company. (If you’re competing in a saturated market, you should stick with five.)

But how can you create a list that accurately portrays the companies that are truly in your field of competition? First and foremost, here is what you need your organization to be in agreement on:

1. The Consumer (WHO)
Who are your ideal clients (both individuals and businesses)?

2. Problem (WHAT) What fundamental problem does your product address for the people who are likely to buy it?

3. Product Category (HOW) What are some possible solutions to this issue? Are you resolving this issue with a method or technology that has not been seen before?

Direct rivals are businesses who sell to the same clients and solve the same problem by employing the same or a solution that is comparable to their own (technology). The following diagram illustrates how the Customer, the Problem, and the Solution all overlap and compete with one another.

Direct competitors offer identical solutions to the problem that they both tackle for their shared consumer base. When I talk about a solution, I’m referring to a similar technology or strategy to the issue at hand, namely one that the consumer won’t be able to tell apart. As an illustration, Uber and Lyft are examples of direct rivals.

Direct competition equals the same client with the same issue being addressed by the same or a comparable solution.

Some of our rivals sell to the same consumer using the same (or a similar) technology, yet they address an entirely different issue. For instance, UberEats sells to the same clients as Uber but solves a different problem: delivering food rather than providing transportation services. DoorDash and GrubHub are two companies that come to mind when thinking about direct competitors to UberEats.

Different Problem = same customer + different problem + same/similar solution

Some of our rivals offer solutions to the same problem utilizing the same technology, but they target our customers in a different way. Zum, for instance, offers schoolchildren rides to school, so resolving a problem of transportation for both the children and their parents. Zum also addresses a somewhat distinct issue, namely one of safety. When it comes to their children riding bikes or scooters to and from school, parents’ top concern is always their children’s safety. Despite this, it ultimately relies on the same technology as Uber does.

A New Customer Equals an Existing Customer With the Same or a Similar Problem and the Same or a Similar Solution

Some businesses find a solution to the same problem for the same consumer by employing an alternative course of action. It’s possible that the technology or the procedure will be different. For instance, Chariot is a company that offers group transportation services for commuting employees and commuters. In order to solve the same difficulty that taxis face with their clientele, Chariot takes a completely different strategy.

Different Solution = same customer + similar problem + different solution

The following table provides a concise summary of how to analyze organizations for the selection of competitive analyses. This strategy is not ideal, and it is possible that it will not be successful for some businesses due to the fact that each company runs in its own unique and complex ecosystem. However, it offers a fundamental structure for choosing amongst competitors.

If you restrict your company to dealing solely with direct competitors, you may end up with an extremely limited perspective of the market. Utilizing this framework, you will be able to evaluate businesses that are not just your direct competitors but also businesses that have the potential to quickly migrate into your territory. You should think about doing business with companies who aren’t currently operating in your category but that might be able to use their product or technology in your sector in the future.

The most hazardous competitors, other than those that directly compete with you for customers, are those who sell to the same demographic of consumers as you. These businesses already have access to clients, making it much simpler for them to supply goods or services that resolve an additional issue for the same customers.

Alternatives

The functionality of alternatives can be radically different, but they can nevertheless suit customers’ comparable or related needs. It is crucial to have this knowledge so that you are aware of what you are up against and can position yourself appropriately. For instance, walking, taking a taxi, or riding a bike are all viable choices that can be made in lieu of using Uber. Learn more about the available options.

Size of the Company

It is a fallacy to believe that you should only examine competitors whose companies are of a comparable size to your own.
The idea of relativity is shown in Dan Ariely’s book “Predictably Irrational” through the usage of the image that can be found further down on this page.

Competitive-analysis.001

It should be brought to your attention that the red circle on the left appears to be significantly larger than the red circle on the right. The two red circles, despite what our intuition was telling us, are the same size. When compared to the other, smaller circles that surround it, the one on the left appears to be the largest. In comparison to the other circles, the red circle on the right appears to be less significant.

This optical illusion helps to highlight how crucial it is to take into account your relative position in comparison to that of your competitors. When compared to companies with a lesser market share, your business may appear to be larger and further ahead of the pack, while appearing to be unfairly smaller and further behind when compared to companies with a greater market share.

If you look at market leaders, which are typically larger organizations, as well as smaller companies that are frequently more agile and younger companies, you can establish a perspective that is much more balanced.

Because of this, you are able to calibrate exactly where you are on the spectrum. Are you expanding at a rate that is quicker than average for a firm your size and age? Do you do roughly as well as a market leader that used to be a smaller business when you compare your results to theirs?

When determining which businesses to include in your competitive study, having this background information available will be beneficial. If you have a more thorough picture of the competitive landscape, then you will be able to spot prospective prospects for your organization in a more efficient manner.

How to Carry Out an Examination of the Competition (Part 3)
You are now prepared to start the actual work because you have completed and finalized your list of potential competitors. When beginning an examination of a rival, it is best to begin by gathering fundamental information and work your way deeper from there.

5. An Overview of the Company

Why is it necessary to keep track of the starting date, number of rounds of fundraising, and personnel count of your competitors? Therefore, you will be able to compare it to your own progress and utilize it as a benchmark. How quickly did your competition expand when it was at the same stage as your company? If your business has been operating for a year. What kind of income did it bring in each month? How many clients did it have at that time?

You may use this information to develop yearly goals and projections for your company if you’re a start-up competing against an established industry leader. Websites such as Crunchbase, LinkedIn, Owler, and AngelList all have information that might be considered the “biography” of a particular business.

Count of Employees
If you are unable to locate information regarding a company’s sales on the internet, Jason Lemkin of SaaStr provides a straightforward formula that can be utilized to derive a rough estimate of such revenues. This formula is simply based on the total number of employees at the company (read more). In most cases, LinkedIn is the greatest source to use when looking for an active employee count.

The Year of Inception
When conducting an overall analysis, having the starting year of a company at your disposal helps put everything into perspective. You will find it valuable as you chart their prior growth over the years; it will serve as a helpful reference as you define the goals for your own firm.

Investors
In order to prevent their investments from being cannibalized, venture capitalists typically place only one bet within a certain product category. You have either invested in Uber or Lyft, but not both. The majority of people in the Valley share this point of view. If you notice that a venture capitalist’s name is absent from the category in which you are competing, you may consider approaching them about fundraising opportunities. They had the opportunity to invest in one of your competitors, but they chose not to. Now, however, they have the possibility to collaborate with you.

The total amount of Clients
It is highly improbable that you will find an accurate count of the customers that your competition has. However, if you have a relative sense of where each rival is in the hierarchy, a good guess is all you need as long as that is the only thing you have to rely on.

When conducting research on press releases, you might frequently find some hints. When a company reaches a certain milestone in terms of revenue or client count, they frequently make a point of bragging about it. You may find out the number of websites that feature your competitor’s product tag by using technological tools such as Datanyze. Product review websites like G2Crowd, for example, can also be of assistance.

Combinations, or Mergers and Acquisitions
One of the simplest methods for businesses to enter a new market or eliminate a competition is to join forces with another company or acquire them. When a corporation that specializes in web analytics purchases a company that monitors mobile applications, the signs are all there for you to see. It’s about to make its debut in a different market. Conduct research into the mergers and acquisitions (M&A) history of your competitor to gain insight into the path it is taking.

Share of the Market Information on market share is not simple to get by. The majority of software as a service (SaaS) organizations do not have the resources that large corporations do to research market share, which can cost millions of dollars. Conducting a survey with a sample size of between 200 and 300 respondents and asking those respondents what tools and solutions they are utilizing is the most efficient short cut. In most cases, this amount of information is sufficient to obtain a rough estimate of market share in the SaaS industry.

The Strengths and Weaknesses of the Organization
It is important to gain a knowledge of what it is about the organization of your rival that sets them apart from you before we move on to discussing the advantages and disadvantages of the products they offer.

Is the Chief Executive Officer, for instance, an example of an influential industry figure? Does he or she have a sizeable following on the various social media platforms? This is a vital point to keep in mind, as this is a distinctive advantage that cannot be readily duplicated by another person.

You should also think about the ways in which the company culture and the internal processes effect the bottom line of the corporation. Netflix has garnered a lot of praise for its “no brilliant jerks” policy, which is enforced within the corporation. This is only one of several elements that makes it easier for it to attract and keep the best employees year after year.

This goes back to the very foundation of the company, and it is a strength that cannot simply be replicated.

I really can’t help but bring up Travis Kalanick, who, in my opinion, has always been both Uber’s greatest strength and its worst vulnerability. You would have a hard time seeing a person of any other personality starting a once-in-a-generation company in the transportation industry due to the industry’s intricate ecosystem. Do you really believe that? In his book “Upstarts,” Brad Stone discusses the early days of the company Uber.

Glassdoor’s database of employee reviews surprisingly contains a wealth of information that might be put to good use. The fact that employees can provide feedback while remaining anonymous allows them to speak their minds about the aspects of their employer that they enjoy (and dislike). You can often uncover characteristics of an organization’s culture by reading how employees feel about senior leadership and whether or not they love working there. This will tell you whether or not employees enjoy working there.

company-specific

A review of the following questions:

How many people are working for your competition across the board?
Are their operations getting larger or smaller than before?
How long has your rival been in business?
Where exactly do they have their presence in the market?
How much have your rivals’ fundraising efforts brought in so far?
Who are the investors backing your competition?
How many customers does your primary competition have?
Are you able to provide an estimate of the growth rate or revenue of your competitor?
Have your competitors bought companies? If yes, in what types of businesses?
What percentage of the market does your main competition hold?
What do you see to be the primary organizational strengths and shortcomings of your primary competitor?
6. An analysis of going to market (Customer Acquisition Analysis)
After you have finished gathering corporate information about your rivals, it is time to investigate the go-to-market strategy and customer acquisition plan that they employ.

Keep in mind that a grasp of the following five components is necessary for an efficient GTM strategy:

Messages geared toward specific customers and strategic objectives
Pricing and availability of products on the market
Channel Customer acquisition approach
While you are conducting your research, you will need to find answers to a variety of questions, including the following:

Who are the perfect customers for each of your competitors, and what are their features and requirements?
What strategies does each competition employ to bring in new customers?
What kinds of articles do they publish, and what subjects do they mostly focus on?
What is their sales process, how long does it take, what channels are engaged, and how involved is their sales team?
How simple is it for clients to transfer over to your business from one of your rivals?
Where can I find information on the entry requirements for the industry, as well as those for each competitor?

6.1 The intended clientele

When discussing business-to-business transactions, the term “target customer” (also known as “ideal customer profile”) refers to both the firm and the decision maker profiles. If we don’t consider the decision maker’s organization and the people who have a stake in it, we won’t have a complete understanding of the difficulties and pressures they face. Larger corporations have the financial resources to throw at challenges in greater quantities than smaller, more nimble businesses. Depending on the size of their firm, even decision makers with the same title, similar aims, and same issues could have different priorities and stakeholders to convince.

Put yourself in the position of your rivals and have an understanding of the customers they serve:

Which types of businesses do your competitors sell to, and how big are they, in terms of revenue?
Who is the major decision maker and buyer in terms of the economy?
What are the most important priorities for the customer of your competitor?
What kinds of things do your competitor’s customers do on a daily basis? What kinds of successes do they measure? What kinds of difficulties do they face?
Which organizational functions are taken into consideration while making a purchase decision?
Here are a few locations where you can look for more information about this topic.

Website belonging to a competitor
On their websites, the vast majority of businesses feature customer logos and case studies. Look for recurring trends in the different sorts of consumers that they highlight, paying attention to aspects such as the company’s size, location, industry, and revenue. These will provide you with some very solid indicators as to the types of clients that they are aiming to attract.

Product offering for data analytics and enrichment
Do you want to learn more about the technology stack that your competitors are utilizing? Datanyze is an excellent tool for gathering information. It examines millions of websites in order to locate fragments of code that reveal the integrations, platforms, and plugins that are powering a company’s offering.

Evaluations of products
Your objective is not, as is only natural to assume, to develop a list of the clients of your competition. You need to be on the lookout for trends that can illuminate the reasons why your customers prefer your competitors’ products or services.

Mining product evaluations enables you to obtain crucial voice-of-customer data, such as the difficulties and problems that customers experience, which you may then utilize to design your own strategy.

Customer reviews are a fantastic resource for discovering the “trigger events” that motivate customers to search for other methods of resolving their problems with an existing product or service.

For instance, when a firm opens a new office, it needs services that will help identify a new office, set it up, and transport furnishings to the new location. These services are provided by companies who specialize in these areas. As a result, the opening of a new office may serve as a catalyst for the search for a solution that enables businesses to receive assistance in completing this procedure.

Customers are typically glad to provide this information in their reviews since they understand its significance as a component of the purchasing process.

6.2 Messages of a strategic nature

The most noticeable aspect of your marketing is your strategic messaging, which includes both your copy and your brand. Due to the fact that it is so easy to observe, companies frequently engage in full-scale messaging battles against one another. You make a change to the headline message that appears on your homepage, and your rival immediately responds with a new message of their own.

The process of developing strategic messaging is not the same as developing a brand or working on a copywriting job; rather, it goes beyond merely communicating feelings and emotions.

The use of strategic messaging, which is a value-based communication strategy, is something that businesses do in every encounter they have with stakeholders, including interactions with employees, prospects, customers, partners, and investors.

The value of a product can be communicated through strategic messaging in a way that is meaningful to all of the stakeholders engaged in the purchasing journey.

Read the press releases of your competitors, investigate their websites (especially the about us page), and read their content to gain an understanding of the following:

What is the narrative that your competitors are selling to their customers?
What kind of a position does your rival take with their product?
How does your rival explain the value proposition of their product and the benefits it offers?
What expressions does your rival use to explain their business, the product they sell, and the value they provide?
What does one statement say about the business model of one of your competitors?
Positioning of the product
Products in the software industry can contain a large number of features and address a variety of issues. However, what issues does the solution that your rival offers focus on the most?

Look for patterns that bring attention to the products that your rival focuses on.

Approach to Content Strategy

What subjects do the articles of your rivals cover?
Which subjects are discussed on the company blog, as well as in the whitepapers, studies, films, and podcasts produced by the company and other resources?
How do potential customers and clients react to the content that your competitors produce? Do they like it, share it, or remark on it?
company-customer

7. The Availability of Products and Their Prices

After you have gained an understanding of the customers and message used by your rival, you can move on to evaluating the product offering that they have. To begin, make a list of the capabilities and limitations of the product offered by your main competition.

Analysis of the Product’s Various Features
Make a list of all of the features that your rival provides, and then describe the value that each item gives to the customers. Construct a diagram illustrating your company’s traits and values, and indicate where they coincide with those of your competitors.

Which of your rivals’ products are notable for their most distinguishing qualities?
What aspects of your product set it apart from those offered by your rivals?
How do the features of your product stack up against those of your competitor’s product with the same features?
Does your competition support numerous environments (e.g., web, iOS, Android)?
Pricing, as well as the Typical Retail Price (ASP)

What is the lowest price that your primary competition offers for their products?
What exactly is an ASP?
What are the most important aspects that determine the pricing (such as the number of seats, the volume, etc.)?
Comparison of the Product’s Strengths and Weaknesses

What are some of the advantages offered by the product that your rival sells?
What are some of the drawbacks of the product that your rival sells?
How do customers feel about the product design, quality, and price offered by your main competitor?

7.1 Customer Acquisition Model

The process through which a company attracts prospects and turns them into customers is described in a customer acquisition plan.

What kind of marketing strategy does your competition use for their product?
Is there a free trial or freemium option available through your competitor’s website?
How challenging is it to make the transition away from your main rival?
The expenses of switching
The rise of software as a service (SaaS) has significantly cut down on the costs associated with switching. On-premises solutions included the purchase of pricey equipment and software in addition to an onboarding process that was frequently tedious. Changing from one SaaS solution to another is a lot simpler today than it was in the past.

However, there is still the issue of switching costs, which refer to the expenses incurred by a consumer as a result of moving product providers. Increased switching costs can also be caused by technological factors. When a product is integrated with several different systems and application programming interfaces (APIs), it becomes progressively difficult to move to another product. A change like this will typically result in the interruption of operations as well as the requirement to retrain workers, among other unwanted impacts.

Because the costs of switching are such a substantial impediment to switching to a new product, your competitive study should place a significant emphasis on this factor.

Unique Barriers to Entry
Barriers to entry can take the form of high costs or other impediments that make it difficult for new rivals to enter a particular market or sector of the business world.

Tom Tunguz brought to our attention three obstacles that prohibit businesses from entering a competitive market: the data network impact, network effects, and ecosystem development (read more). Do any of these fundamental hurdles to entry exist for your competitors’ businesses?

It is a wise decision to protect your corporation by utilizing one of the primary barriers. Nailing down two obstacles is even better. Slack is an excellent example of a firm that possesses a network effect since it has been able to successfully establish widespread demand by relying on word-of-mouth referrals and offering a product that is extremely engaging. In addition to this, it has put effort into establishing solid ties with developers. The company has been able to build a robust ecosystem around its product with the assistance of Slack’s developer platform roadmap and its dedication to providing openness for developers.

One of the numerous competitive advantages that Slack has intentionally built over time is the company’s large ecosystem, which is now available to users.

Business Models
It is worthwhile to undertake an examination of the sales models utilized by your competitors over the course of your competitive analysis. In his essay titled “Three SaaS Sales Models,” Joel York explains the three most prevalent sales models for software as a service (SaaS) based on the link between the price of the service and the complexity of the product being sold. Companies that sell products that are both inexpensive and straightforward need to prioritize the development of a self-service option in order to keep their customer acquisition cost (CAC) and customer lifetime value (CLV) ratios in a healthy balance (CLV). Slack, Trello, Dropbox, and GitHub are all examples of products that are both inexpensive and simple to use.

When it comes to acquiring new customers, a transactional sales strategy is preferable to a self-service approach when the product in question has a higher average selling price (ASP). Customers anticipate being able to view a demonstration or perhaps test out the goods. In point of fact, when clients pay more, they anticipate being guided through the process more carefully and attentively. In spite of the fact that this can result in increased organizational costs and complexity for a SaaS provider, it has the potential to generate substantial income and long-term customer loyalty. For this strategy, businesses need to optimize their sales, marketing, and support functions in a way that enables them to develop a connection with the customer over the course of the client’s whole engagement with the company. The vast majority of organizations that provide SaaS fall under this group.

The enterprise sales procedure is only used for products that are exceptionally complicated and expensive to purchase. Because enterprise products offer such a high level of value and prospects require more time to analyze the product, businesses are forced to implement more complicated sales processes and endure longer sales cycles. When you sell to large businesses with a high ASP, you are in direct competition with other businesses who use high-touch sales techniques.

If your rival is concentrating on a model in which customers take care of their own needs, you need to rethink how you market and sell your products in order to put more of an emphasis on the relationship you have with your customers. If you too rely on a model in which customers serve themselves, you will need to compete based on your brand or some other aspect. To put it another way, you won’t be able to compete on goods due to the ease with which customers can transfer providers.

If you are providing a high-priced and complicated product, you should direct your attention toward competitors who are vying for the same kind of enterprise clientele. However, keep in mind that competitors who offer self-service are always a risk, and because of this, you need to regularly monitor the features they roll out.

8. Channel

You and your competitors are vying for the attention of those who might become your clients. Because of this, it is beneficial to have an understanding of the social media channels and paid acquisition channels that your competitors use to communicate with their respective target audiences. In today’s market, digital channels are extremely important; nevertheless, you also need to pay attention to offline channels such as events, meetups, conferences, and direct mail. These are all examples of offline channels. This is the place where face-to-face contacts take place, which are typically the most important factor in forming connections and concluding business. You can typically obtain information about offline events by going to the “Events” section of the websites of your competitors and also by looking for their names in relation to conferences and other events on the wider web.

Where do some of your competitors place their advertisements?
Which keywords do they choose to purchase using AdWords?
Do they run advertisements on social media platforms such as YouTube, Facebook, Linkedin, and Twitter, among others?
Do the majority of your competitors’ sales efforts go toward a particular industry vertical?
This article introduces thirteen tools that can be utilized in the analysis of the marketing channels utilized by your competitors.

9. The Quality of the Customer Experience and the Success of the Business

It is important to gain an understanding of the level of contentment that customers have with a competitor’s goods. When it comes to determining the success of a business, nothing is more important than the experience that the client has. Review platforms are the most reliable sources for obtaining this information.

The product of your competition is liked by customers in what ways?
What exactly is it that they appreciate the most about your rival?
What aspects of your competitor do customers dislike the most (what are their top complaints)?
How do your competitors stack up in terms of their Net Promoter Score (NPS)?
How committed are people to purchasing the product of your rival?
What is the one thing that stands out the most in the customer case studies that have been conducted?
Do you receive complaints from clients about the quality of service or the products themselves?
When it comes to providing customer support on social media, how quickly do your competitors reply to questions?
G2 Crowd, Trust Radius, Capterra, Software Advice, GetApp, Founderkit, and Appbot are just few of the places online that are excellent resources for finding client feedback. You also have the option of conducting interviews with current and potential customers to find out how they feel about your product in comparison to that of a competitor.

competitive-analysis

10. Tools and Resources and Techniques

When you are conducting your study of the competition, you may make use of a wide variety of tools and strategies in order to get the work done successfully. I’ve touched on a few of these throughout the course of this tutorial, but here is a more comprehensive list of extra resources.

The techstack and technological advancement:

Datanyze is a program that, as was mentioned previously, examines millions of websites in order to locate bits of code that reveal what integrations, platforms, and plugins are powering a company’s offering.
Similartech is a service that is comparable to Datanyze.
Builtwith is a tool that will tell you what kinds of technologies various websites are utilizing.
Profiles of the Companies:

Discover the latest industry trends, investment opportunities, and news about your competition with Crunchbase.
You can get “biographical” information about a competitor via LinkedIn, which is an online professional network. In most cases, this is the best place to go for an active employee count.
Check out which startups are recruiting and for what positions by using the Angel.co website.
Comparable to Crunchbase in many ways.
DataFox is a tool whose database reveals which businesses make use of more than 14,000 different technological solutions. You can search this database using an algorithm called the Similar Company Algorithm.
See company profiles, important individuals, and growth indications related to your competition with Mattermark.
You can find slide presentations relating to competitor products or funding on Slideshare.
Evaluations of products:

G2Crowd is the most useful tool for discovering what customers think about your company’s products as well as those of your competitors.
GetApp is a platform that is analogous to G2Crowd.
Comparable to G2Crowd is the website TrustRadius.
Quora is a great place to look for questions or discussions about certain items or themes, which could prove useful in your analysis of the competition.
You can find product demonstrations as well as talks on YouTube.
Traffic on a website:

Web optimization and search engine marketing are abbreviated as SEO and SEM respectively.It’s quite unlikely that any prospective client or consumer reads your news releases with the same level of interest that your rivals do. Understanding the strategic emphasis of a corporation is facilitated by reading its press releases. Sometimes public relations will display the number of customers that your competitors have. The About part of a press release provides insight into the strategic messaging employed by your rival. Your competition wants their clients and prospects to have the same perception of the firm and the items that it offers as expressed in the next two to five sentences.

Understanding the marketplace and determining how you may separate yourself from other companies is the major objective of conducting a competitive study. When you have finished conducting a competitive analysis, you should make a battlecard for each of your competitors. The purpose of a competitive battlecard is to provide your sales and marketing team with a quick visual reference that will guide them as they position your organization in relation to other businesses in the industry.

battlecard

Comparison between PublishNOW and WordPress: a Sample Battlecard
The following is a fake battlecard that describes how a new product from PublishNOW will be positioned in competition with WordPress. It uses two real firms as its examples. PublishNOW is a content publishing platform that helps boost content engagement, content stickiness, and reach. Marketers and writers can use PublishNOW. WordPress is a platform for running blogs.

The battlecard provides sales with a tool to better grasp the advantages and disadvantages of WordPress, as well as strategies for gaining clients when competing with them.

battlecard-publishnow

Summary
You will be able to properly do a competitive analysis if you follow the steps provided in this tutorial, which are as follows:

Choose some competitors to analyze, and be sure to include both direct and indirect competition.
Acquire a general understanding of each of the competing companies.
Determine how each competitor enters the market and obtains customers.
Analyze the product offering, including its features, price, strengths, and flaws, as well as whether it is given as a freemium or free trial, and the overall business plan of the rival.
Determine the advertising and distribution methods that your competitors employ for their items.
Conduct research on the level of contentment experienced by clients of your competitors.
Put all of this knowledge to use by populating your competitive analysis framework and competitor battlecards with it.
Remember: The purpose of conducting a competitive study is not to fixate excessively on the rival companies but rather to gain an understanding of where your company is in the industry and to locate opportunities to differentiate itself further. At the end of the day, putting your company’s attention on the client rather than the competition will be of much more benefit to your business. When done correctly, a competitive analysis can assist you in identifying methods to gain an advantage over the competition by providing superior service to customers (both yours and theirs).