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Writing a Competitive Analysis

Overview

This document covers writing competitive analysis for consumption by sales people. Competitive analysis for product planning use will require the same research, but would be delivered in a different form.

Target Audience

Your sales staff is the target audience. If you have a direct sales force, they are generally willing to read through more information. However, if you sell through channels, your competitive analysis must be very short and to the point. Sales people generally don't have much time to pour over competitive information, but if you use sales engineers to help sell your product, they will need technical details on weaknesses of the competition. They need to quickly understand the weaknesses of a given competitor and how to position your products strengths against that competitor. Be sure to outline your target audience before starting so that you can review your materials with them in mind.

Where to get the Information

The most obvious place to get the information on competitors is from their web site. You can always find datasheet type information on the web site. Pay attention to what isn't listed in the datasheet. If it isn't listed as a feature, it may not be available from the vendor. Some vendors have manuals on their websites with release notes that are rich with strengths and weaknesses of the product. However, there is no better way to do competitive analysis than to buy the competitors' product and try it out yourself. Depending upon the price of the hardware/software product, this may not be very easy to do.

In addition to features of the product, you may want to include some information about the health of the competitor's company. Press releases will tell you if they are venture funded and when they raised the last round. Job listings will tell you if they are hiring and growing as an organization.

Using a consultant to pose as a prospect will also get you more information. A good con-artist can always make it through and get much information on strengths and weaknesses.

Format

There is no standard format that works for every company. A matrix is best for hardware products and sales channels. More complex products require an understanding of competitive strategies. Sales engineers want technical details and sales people want high-level, broad-brush positioning. The list below is comprehensive. You will need to include as much, or as little, of this information dependent upon your target audience. The only mandatory items are the first two.

  1. Confidential mark. You do not want this document in your competitors hands. Some companies print the information with serial numbers and on red paper to avoid duplication. Even if you do not go that far, a confidential mark at the bottom is not enough. Add a confidential banner in the background of the text. You may also want to avoid distributing the document in electronic form.
  2. Summary positioning. This is the bottom line for the sales person. You should have one paragraph for every competitor that sums up how your product's strengths should be positioned against the competition's weaknesses. This paragraph should be at the top of any competitive document since it may be the only thing a sales person has time to read before going on a call.
  3. Matrix. A matrix is very helpful for hardware products as well as for software products that are similar to the competition. A matrix lets you call out, in summary form, the major competitive advantages of your product next to one or more competitors. You should generally include specifications and pricing. The matrix does not work well when you have dissimilar competition. You need the strategies section below for dissimilar competition.
  4. Strategies. When you are competition against categories of products you will find that there are broad strategies appropriate for multiple competitors. Outline the strategies using bullets to drive home the important points.
  5. Summary of Strengths and Weaknesses. You may want to include bullet points explaining the strengths and weaknesses of the competition. Some people don't feel comfortable documenting a competitors' strengths and you certainly don't want a customer getting a hold of such a document. But this documentation will help sales people and systems engineers avoid being blind sighted by a competitor and allow them to be more prepared. If you include strengths, you may want to include a possible counter argument for the strength to give the sales person something to work from or, at least, make them look like they know what they are talking about.
  6. Other information. There may be more company information that you want to include such as the size and funding history of the company.

Delivery

An internal website is one method of delivery that companies use for this information. The risk is that a sales person may cut and paste directly from the site into an e-mail. The decision about how this very sensitive information is distributed should be made by the executives in your company.

Process

  1. Identify the top 3-6 competitors. Even if you have a bunch of competitive information, it is important to have the information on the top competitors in a handy, useful, up-to-date form.
  2. Start the research on the competitors in parallel. It may take you more time to get information on some competitors than others, so it is easy to start the process for the top competitors at the same time.
  3. Complete your research and build your analysis one competitor at a time.
  4. Review your materials with your target audience in mind. Have someone from your target audience review the materials before they are distributed.
  5. If you can, roll out the information as it is completed, one competitor at a time. It is much better for sales to get the information earlier rather than waiting until you present everything together. It also gives them some insight into what you are working on and they can help you prioritize the competitors as well as suggest additional information that they would like to see included in the analysis.
  6. Put together a reasonable schedule for updating the information. Schedule quarterly updates, for example, and work on one competitor at a time so that the information is complete and current.

By Infrasystems - Barbara Tallent

 

 
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