Competitive Analysis: Digging for Info

By Jacques Murphy August 15, 2007

from PRODUCT MANAGEMENT CHALLENGES
A Weekly Newsletter of Tips For Companies that Develop Software.

Product Managers are often called upon to analyze the competition, perhaps with an eye to positioning the product to sell better, or as a way of determining which features to add in order to better compete in the market. In the two previous topics, we covered competitive analysis as a general topic in Competitive Analysis: Ready When They Are and specifically for sales in Competitive Analysis for Sales.

This article continues the discussion with some miscellaneous tactics and techniques, detailed below, to point you in the right direction when you are called upon to analyze the competition.

The Wonders of Automation

Monitoring competitors requires a lot of time going around to their web sites to stay up to date on changes in their organization and product. As often happens, such time consuming duties are neglected in favor of more pressing tasks.

One way to help yourself perform the equivalent of regular, proactive monitoring is to sign up with newswire services to receive press releases and other information on all competitors you wish to track. Places such as Business Wire let you specify ticker symbols or company names, as well as other key words, so that you can receive daily or weekly news items and press releases.

By getting information on competitors when it is as fresh as possible, you get the most out of it.

Pieces in the Puzzle

Because of time constraints, you usually won't have the time to devote to a full-blown information gathering project on a single competitor, let alone more than one. Instead, realize that the effort to gather information has a longer term goal.

Your effort to gather information is going to be like putting together pieces of a puzzle. You will get the pieces one at a time, from comments by coworkers, news items you read, and discussion with analysts or prospects.

Each time a piece of the puzzle comes in, add it to your materials, and spend a little time (just a little) thinking about how it all fits together into a bigger picture. Then jot down any insight you have about the bigger picture onto a separate page reserved for analysis. You'd be surprised at how soon you have a reasonably complete picture from which to answer questions and provide advice.

Information Vs. Analysis

You can spend a lot of time gathering information, but it won't be very helpful to your coworkers unless it's accompanied by your analysis and advice. It took me a long time to realize that my ability to read through information and quickly draw connections and conclusions was not something that most other people shared. Be sure to write down your analysis (no matter how minor) so that everyone can benefit from it. Your coworkers may not necessarily make those conclusions when they read through the materials.

For example, something may jump out at you when you read a long press release. 'I notice they don't have any quotes from customers about this new feature. Maybe nobody is actually using it yet.' That's a great sentence to add to an analysis page, so that when sales reps are sifting through information on that competitor, they take note of this and ask probing questions in accounts where the competitor is selling against them.

Without the succinct analysis that gets to the heart of the matter, you risk having sales reps and others ignore the raw information you collect.

If you gather lots of information on a competitor into a single document, available on the intranet for example, make sure that the analysis is on the first page.

Noting the Unusual

One of the problems I have seen with competitive analysis projects at smaller companies is that they can get bogged down in an attempt at compiling comprehensive information on each competitor. If you have the time, it's a nice idea. But if you don't, try to ignore the routine information and note only what's unusual.

For example, you may choose not to put together information on each competitor's sales force. But you would note that Competitor X operates entirely through indirect sales that happen through partnerships. The assumption is that other competitors have a direct sales force unless otherwise noted.

If all your competitors but one are breakeven or profitable, only note down that Competitor Y is funded through venture capital. You note it because it's the exception, and you limit your description of all the other competitors to information that is truly noteworthy.

Looking for Cause and Effect

Your sales reps and other teammates can quickly pick up factoids on a company by scanning its web site or collateral. It's easy to find 'stationary' facts, that don't explain anything in the context of time or of cause and effect.

You can add valuable insight to the mix by providing a simple chronology, or explaining what caused a development to occur.

For example, a potential competitor appears to have moved into your space, competing directly with you in your core business domain. A press release indicates that a large customer has bought a new module that is positioned to compete directly against you.

But upon further investigation (say, by looking at prior press releases and articles, or putting two and two together), you realize that the customer mentioned for the product was an existing customer of the earlier functionality, which did not compete directly with your product. It's important to point out to the management team or your sales reps that even though the product now appears to compete directly with your own, the company hasn't been successful selling the new functionality on its own merits, at least not yet. The new functionality has so far only been successful in conjunction with the other capabilities that do not compete with yours.

This is an important distinction. It means that while this product may compete with yours soon, it doesn't yet. Your company has some time to plan its response to the new development, with no need to panic, and no need to act prematurely.

This kind of cause and effect or timeline information is something that your teammates won't have time to put together on their own.

Email Dispatches

As significant new pieces of information come in, you build them into the overall competitive picture, adding them to files out on the intranet. But a lot of the time your audience is going to be too lazy to go to those files and pore over everything.

So, when you add a piece to the puzzle, send out an email (to Sales or the management team, as appropriate). This ensures that the information gets out to the field as soon as you receive it.

This also keeps competitive analysis at the top of everyone's mind. Because your teammates see that you are spreading the word as soon as you have significant intel or analysis, they are encouraged to send you info that they run across.

Don't Require them to Read What You've Written

A competitive analysis project tends to be very focused on a written deliverable. Which is great, if only you could make people read it. But most people won't make the effort.

So be prepared to field questions directly, even if you already put it down in writing. Encourage these requests by providing answers promptly. Take the time to walk people through what you know, what you think, and what materials are out there that they can read in more detail should the mood strike them.

You save your company a significant cost in terms of coworkers' time by providing such a verbal explanation whenever needed.

Copyright (c) 2002-2004 Jacques Murphy. All rights reserved.

Categories: Go-to-Market Strategy Leadership
Jacques Murphy

Jacques Murphy

Jacques Murphy is a consultant who helps software companies develop their products faster. He does this using a focused process which quickly develops product requirements. Contact him at www.ProductManagementChallenges.com.

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