It's a critical step in business; you have to know what you're up against to chart a course to success. Yet every year, many new products miss the mark, while others in the same market seem to have runaway success. What is it that sets these products apart? Technical capability? Marketing magnificence? Unimaginable innovation?
In my experience, a fundamental flaw in any product that didn't meet expectations was a lack of grounding in the realities of the marketplace from the target customers' perspective. I recall many conversations with Product Managers overflowing with confidence in their new product concept. They were sure their features were unlike anything the competition could offer, and aggressive sales volumes were all but guaranteed. Despite this confidence, many products never became the success the Product Managers envisioned. In retrospect, there were two key areas of opportunity that could have improved the outcome – customer wants, and competitive assessment.
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First was clarifying customer targets and articulation of their wants and needs. Diligence in understanding who you are targeting and why they would "hire" your product to solve their problem or make their life better must become the benchmark for every decision you make in developing the product. If you ever find yourself with a product and you're not sure who the customer is for it, then you've missed this step.
The second was performing an effective competitive assessment. An excellent competitive assessment is the one that is conducted through the eyes of the target customer and how they would compare you against the competition. This is why having a strong understanding of your customer is so vital. Perhaps it was overconfidence, being too busy, or not using an effective technique. Regardless, one way or another, most Product Managers eventually find themselves wondering how they were beat out by a competitor.
The good news is that a highly effective competitive assessment is a simple concept, and the proper techniques and tools can make it easy to conduct. Start by taking that list of your target customer's wants and needs and listing them out in logical groupings. These will become your requirements which ultimately drive what features & benefits your product will have. You need to assess your competitors' products on each of these criteria, be it objective specifications like weight or highly subjective points like style.
Next, you have to identify your competitors, both direct and indirect. You need to be honest with yourself about who your competitors are and not let your personal point of view cause you to overlook specific competitors or indirect substitutes. Remember, you're looking at the competitive landscape through the eyes of your target customer, and you're looking for solutions to their problems. So, if you're looking to market a snowblower, you may find that an indirect competitor when targeting a young, new homeowner is actually a shovel, especially if the price is a significant factor for that customer.
Now that you have your list of competitors and your list of requirements/features, it's time to plot out your analysis. For objective data, it's straightforward, but for subjective criteria, you must be consistent in how you review each feature and then rate it on a scale of say 1-5. Next, you need to put some level of weighting on each criteria consistent with what you know is essential to your target customer.
At this point, most Product Managers will write up a formula to apply each feature's weighting to the specification of each competitor and create an overall score for each competitor, thus identifying the top competition. This can be a bit tricky and often inconsistent from one assessment to another. Besides, when you wish to add a feature or make another change, you'll have to rework the formula.
With Gocious, weighted scoring of your own products and your competitors' products is built right in, making competitive assessment and other Product Management activities a breeze. Plus, it scores across each and every product variant, increasing the accuracy of the score. It will also show you how the different attributes affect the overall score of the product so you can quickly zero in on what to improve, and what benefits you can boast about as superior to your competition.
Gocious is a purpose-built tool for Product Management that simplifies traditional methods and takes the detailed analysis of complex product plans to the next level.
You can learn more about Gocious competitive analysis solution here