3 sources for competitive analysis

As software product managers, understanding your competition needs to be a very important ingredient of our work DNA. We must gather as much information as possible on our competition so that we know what they are upto both strategically and tactically. It will also help us understand what moves we can make so that the competitor can be forced to make a reactive move on their part – a move that could be favorable to us and unfavorable to them.

There are so many ways in which you can gather intel on your competitors. Here are 3 sources that I have used very successfully.

1) Competitor’s website: Sounds obvious, but as a software product manager, have you read through all the content that is on your competitor’s website? For example, do you know:

  1. The terms and conditions that they offer their customers on a product sale. For example, if you are in the eCommerce space, do you know what your competitor’s return policy is? What exactly is included in your competitor’s offering of 30-day free trial? Does the customer need to input a credit card to sign up for the free trial?
  2. How much money does your competitor (a publicly traded company) have in the bank? What is their cash flow situation? If the cash situation is dire for your competitor, can you hasten their exit via a move that will force them to spend more money (for example a discounted pricing promotion?)
  3. Who is on their management team and their board? What expertise and connections do they bring to the table? For example, if their CEO or an investor has prior employment relationship with amazon.com or Google, what does that mean to the business and in turn any possible impact on you? Do their investors have prior experience in your industry that may open doors for your competitors for potential sales?
  4. What jobs is your competitor hiring for? This will help you understand where your competitor wants to go because hiring reflects plans for growth. Or has a key employee left the company? If yes, what could this mean? Hiring to replace a key employee is always a setback to any business – there is never a case where a replacement can be done without missing a heartbeat.
  5. How is your competitor getting the word of their products into the market? Where are they advertising? What promotions are they running? Does the customer have a referral program? How does the referral program work?

2) Your “human” network: No matter how much easier competitive analysis has become because of the internet, it is still not a substitute to the stuff you can find via the good old way of tapping into your “human” network. You may be able to gather information from people in your network via face to face meetings because they can share it off the record without having to put it in an email or other digital media. Here are some specific networks you need to look into:

  1. Former employees: Do former employees of your competitors belong in your LinkedIn network? If yes, what can you find out about your competitors through them? (However, I want you to caution on legal ramifications here as well. Never ever put your contact or yourself at legal risk by asking for confidential information such as documents etc. Even if this is offered to you, refuse – a lawsuit from your competitor will be far more damaging than not having a piece of competitive intel. Getting the name of the internal champion your competitor has at a prospective customer account is one thing, but holding a piece of confidential document from your competitor is a completely different thing – you should never get into a legal situation where you can go out of business because of breach of confidentiality.)
  2. Venture capitalists: If you are a VC funded company or if you have friends in the VC community, can they help you get competitive intelligence? For example, is your competitor looking for another round of funding and approaching VCs? Believe me, the VC community is a big boy’s network and a closely knit one too – tapping into this judiciously can help you gather competitive intel.
  3. Your new customers: If you won an account against your competition, what can this new customer tell you about the competitors who lost out? What tricks did the competitor bring to the table to win the account? Did they offer any creative or discounted pricing? What did this new customer learn from the references the competitor may have provided during the sales process? Can you get the information on these references so that you can talk to them?
  4. Supply chain: Does anyone know people in your competitor’s supply chain – for example, system integrators in the case of an enterprise implementation. How do they view your competitor? How do they like (or dislike) working with them? Unless there is an exclusivity with your competitor, these folks are always looking for more business including yours and would be willing to share more information on industry and competitive trends with you, depending on the strength of your relationship with them.

3) Competitor’s digital network: What are people saying about you and your competitors on the Internet whether it is in forums, product reviews or social networks. The fastest way to keep on top of this is to set up a google alert on each of your competitors both by company name and the product(s) name. Have google alerts deliver a daily digest into your inbox so that keeping an eye on your competition becomes part of your DNA. Granted that google alerts will pick up a lot of duplicates when it comes to things like press releases, but I would rather get duplicate information than none at all. Plus it only takes a few seconds to check the google alert emails that it is not a big chore.

What do you think? Do you have other sources you have successfully used to gather competitive intel? Please share via comments.

4 thoughts on “3 sources for competitive analysis”

  1. The web-site, human-network and digital-network refer to different type of information *sources* that are sometimes more reliable and sometimes less. for example – marketing statements in the web site usually tell what the company aims at doing, but not necessarily what it *is* doing.
    In that perspective – case studies are a more reliable source of information than unsupported statements.

    I think that it is also important to carefully review additional aspects in the business environment:

    The distribution channel/partners and customers – this information can be usually taken from the web-site (distributors, case-studies), and shows where the company really is and not where it wants to be. distributors of the company would sometimes be willing to tell you the strength and weaknesses of the company they represent.

    The partner ecosystem – this facet enables understanding the real location of the companies part in the ecosystem puzzle and its power in approaching specific verticals of the market.

    The technology core – based on analysis of the product and R&D expertise – this facet enables understanding core features of the product, including cost/price constraints. a change in technology would usually take a lot of time if done organically, and would not be possible without substantial investment.

  2. Excellent post as usual. One another source of gleaning product information is competitor’s corporate blogs.

  3. Well written article.

    One source which you could have included is Industry / Sector analysts. This generally gets covered in your relationship with one or more analysts which cover your company in their reports. But what about analysts who don’t include you? It is worth talking to them.

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