Business Coaching Blog
A tool for competitor analysis
Monday, September 29th, 2014
A business coaching client of mine has been doing some competitor analysis. He is planning to launch a new product so he had his marketing person look at the competition.
The results were useful but unstructured – along the lines of “..well we think our function x is a bit better than competitor A’s function x…” and “…we don’t think competitor B’s website is very user-friendly…”.
Firstly, well done to my client for even embarking on competitor analysis. Most small businesses don’t bother and then wonder why their marketing doesn’t work.
However, the only point of doing this is to form basis for action – to do something different or better as a result. In order to be useful the information has to be structured around your business plan hypothesis; what niche are you serving, what is their pain and how are you better able to fix it? The research should be aimed at understanding a) the dimensions along which your competitors are competing (price, functionality, availability for example) and b) identifying areas where you can create new competitive dimensions (colour, terms, mobility for example).
I suggested my client use a Strategy Canvas to map this out for his new product. This approach is described in Blue Ocean Strategy by W. Chan Kim and Renee Mauborgne. It’s a really simple but effective way to turn unstructured information into a competitive map of the industry. It also forces you to examine your own marketing strategy – if you have one, that is.