The Saassy guide to competitive analysis for new product bets

A lot has been written about establishing competitive intelligence programs and putting in place frameworks for monitoring your key competitors. But how do you approach competitive research when you are deciding about brand new areas of product investment?

In this blog, we will look at how to conduct and leverage competitive research when deciding where to place your new bets and what new solutions to launch.

How are new bets different from traditional competitive programs?

Analysing competition for brand new product areas differs from your well-established competitive program in four key ways: you focus on a different scope of competitors, you analyse them in a different level of detail, you use different tactics, and your goals differ too.

Now let’s deep dive into how you approach competitive analysis for new investments.

Why should you care about competition for new investments?

You have to cover a lot of ground when deciding where to make your next product bet - from market sizing to extensive user research to analysing how the solution may fit into your existing portfolio. Looking into the competitive landscape provides you with insights that have bearing on several different aspects of the overall market assessment. In general, you use the competitive analysis across two stages.

Stage 1: What is the market opportunity?

Is there a market at all?

During the discovery stage, one of your key questions is whether there is a market opportunity at all - the existence of a buyer with a pain point who is willing to pay for your solution. Discovering a competitor may be a blessing in disguise because it indicates a market potential for the solution you have in mind. 

Are you too late to the game?

On the other hand, if you find too many competitors of a decent size, the barrier to entry into the market may be too big. Either you decide not to invest, or you need to be more strategic about how you enter the market.

Do you compete for the same budget?

Competing for the same budget is evident when it comes to direct competitors. But it is as important to look at adjacent and indirect competitors. For example, at Oracle, I worked on the launch of a solution offering customer engagement for households with solar power. We realised that many utilities had one budget for renewable energy software solutions in general, so we competed for the same bucket of money with many different solutions, some of which were very indirect.

Stage 2: What’s your go-to-market and positioning?

Once you’ve made the bet, you have to hone in on your go-to-market strategy and positioning. This is where competitive intel comes handy again. How do your competitors position, what is their messaging, who do they target exactly? Looking at your competition at this stage will help you figure out: (1) what competitive differentiators you should highlight, (2) what your overall positioning is; and (3) what the first market segment you want to go after is.

What competitors should you look at?

For well-established competitive programs, you want to focus on direct competition only. But when it comes to exploring new product opportunities, you want to be as broad and creative as possible. These are the categories of competitors you want to look at:

Your existing competitors

You want to start with your existing competitors - both direct and indirect - and check out their presence in the new solution area, or whether there are any signs they may be moving in. You may also consider how expanding into the new area would help you in positioning against your existing direct competitors.

New direct competitors

Expanding into a new area will likely introduce you to a few new competitors. You want to have a good idea about their solution, SWOT, and positioning, and how you would stack against them - both in the new area and across your whole portfolio.

In-house alternatives

A frequently overlooked yet tough-to-beat competition comes from in-house. If there are no options in the market, potential users solve their problem themselves. In-house solutions range from anything as simple as a google or excel sheet to complex software built by the in-house engineering team. Ironically, this may be one of the toughest competitors because of the sunk costs or habits of the buyer.

Adjacent & indirect solutions

Adjacent solutions either partially address the pain point you are exploring, or they exist within the same area you are exploring. You care about these solutions for two reasons. Firstly, they may solve a key aspect of the pain point, limiting the market potential of your idea. Secondly, you may compete for the same budget.

How do you uncover new competitors?

Looking into a brand new area and figuring out who the competitors are can be tough. Where do you start?

Ask the right questions in user interviews

User interviews remain one of the most powerful tactics in market research. There are two questions to ask will help you discover existing competitors.

Q1: How are you currently solving this pain point?

Q2: Have you ever looked into using a different solution to solve this pain point?

Imagine you are a potential user

Does Google ever not have an answer? The second method is putting yourself into the shoes of a potential user. Imagine you have the pain point and you are trying to find solutions for it. Think about the key search terms, and try a few different angles. This should typically give you a good idea about the solutions out there.

Use associations and forums

There are increasingly more digital associations gathering people of the same professions, interests, or backgrounds. Use them! Imagine that your target market are product marketers. Then going into the Slack group of the Product Marketing Alliance, and posting “Anyone has a solution for this pain point?” in one of the public channels offers another avenue for insights.

What is the B2C or B2B equivalent?

This is a bit of a stretch but looking at the B2B or B2C equivalent of the solution you are considering may give you ideas about the benefits that users care about and positioning that may work. Yes, of course, you need to adapt it to the B2B or B2C world, but if you are just gathering ideas or broadening your creativity, don’t discount the other side.

What’s next?

Once you have made the bet and launched the solution, you are getting into the familiar territory: your traditional competitive program to monitor your direct competitors. For a new solution area, you need to be more attentive and broader at first. You need time to figure out who your key competitors are. But after a few months, a few heads-to-heads with your new competitors, and a few win-loss calls, you will get a good idea and you will be able to move to the traditional monitoring of your key enemies.

(Front photo by B. Bailey from Pexels)