Keep An Eye On The Competition – The Discourse #22
Keep An Eye On The Competition – The Discourse #22
Be aware of the competition, but don’t obsess over their every move
In today’s edition of The Discourse, we’re going to look outwards — towards the competition. What’s the point of doing competitor research? How do we tend to mess it up, and how to do it right?
Before we start, if you’re new here, please subscribe and get insights about product, design, no-code delivered to your inbox every week.
What’s the point of doing competitor research?
When you're working on a new product or feature, you need to get a sense of the competitive landscape. Here’s why:
Features are a proxy for needs
It helps you understand what features competitors offer. Features are nothing but a proxy for customer needs, meaning, when you look at each feature, you try to understand what problem does it solve or what need does it fulfill. This leads us to identify customer needs.
Positioning
Competitor analysis also allows you to identify whitespace in the competitive landscape. You can’t do everything for everyone. But you need to find your niche and your target market.
Positioning is important. April Dunford talks about positioning in her book ‘Obviously Awesome’.
Positioning is the act of deliberately defining how you are the best at something that a defined market cares a lot about.
Investors
The competition research can provide inputs to create a 2-2 comparison chart in an investor deck.
Anecdotal, but I've realized that investors spend more time on the competition slide. This is particularly true if the investors are not aware of the space fully.
What are the drawbacks?
Feature Usage
You might be under the false impression that a particular feature launched by a competitor is what users actually wanted. You don’t know how much the feature is being used.
Start obsessing over the competition
Sometimes you start obsessing so much about what the competition is doing that you lose focus on what you're doing. In fact, according to YC, startups are rarely killed by competition. And the top reason why startups die is a lack of market need.
You will be better placed if you focus on the customer while keeping an eye out for the competition — rather than the other way around.
How to do it better?
It's important to look at both direct competitors and indirect competitors.
Porter’s Five Forces talks about competitive rivalry, the threat of new entrants, and the threat of substitutes.
In business school, I was taught about this Harvard Case Study that talked about diminishing airline profitability in the 1980s. There was no direct competition or new entrants that caused this.
It was the humble fax machine that started getting popular at the same time. It replaced snail mail, priority mail, and in some cases UPS.
Now with the internet, everything online competes with something offline. Zoom's biggest competitor pre-covid was business travel. Look, how the tables have turned!
So, keep a larger net when you think of who the competitors are.
Look through a variety of sources:
Search online resources to get a broader look at your competition:
Crunchbase and Owler (for funding information)
Stackshare (for the tech stack they’re using)
Product Hunt (for launch reception and questions from early adopters)
Landing Page (for positioning and feature set)
App/Play Store reviews (for average customer reception)
Keep a template
Select criteria that will provide you with more context around what they’re building, who they’re building it for, and how they’re reaching users through marketing and design. Here’s a Google Sheets template that I’ve created, which you can duplicate and use.
Company
Funding
Investors
Customers
Target market
Product
Features
Integrations
Security
Where and how can you differentiate? - in context
Marketing
Target market
Landing page positioning
Emails that they send
Resources - Blogs, Case Studies, Testimonials, Podcasts
Social Media presence
Listing and performance on places like Product Hunt
Community - new but growing importance
Where and how can you differentiate? - in context
Once the first version is created, make sure to keep it up-to-date regularly so that you're always aware of what the competition is doing. But remember not to fixate on it 😃
That's it for today. Let me know how you liked this article. Comment on this and I would love to discuss it with you!
Talk to you soon!
— Kavir
P.S. Hit the subscribe button if you liked it! You’ll get insightful posts like this directly in your email inbox every week.