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Tear Apart Your Competition

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Competitive Analysis remains an underleveraged - yet - powerful tool in the product strategist's arsenal. Most companies know who their competitors are. Yet competitive analysis is rarely done in an …

Competitive Analysis remains an underleveraged - yet - powerful tool in the product strategist's arsenal. Most companies know who their competitors are. Yet competitive analysis is rarely done in an in-depth manner and usually only covers feature checklists of similar products. This presentation will cover how to examine every aspect of your competition so that winning strategic plans can be put in place. This includes a four-step process for developing competitive analysis for both internal and external audiences and topics such as SWOT analysis, Porter's five forces, channel, team/company, product features, funding and others.

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  • 1. How to Tear Apart Your Competition Brian Lawley CEO & Founder 280 Group, LLC 1 ©2010 280 Group LLC
  • 2. Agenda A d • About Brian & 280 Group • Special offers • Value of competitive intelligence • Four step process for full analysis • Sources of competitive information • Delivering the results and selling tools • Summary Slides at: www.280group.com/tear.pdf 2 ©2010 280 Group LLC
  • 3. About Me • 280 Group LLC President & Founder • Whistle Communications Director of Product Management & Product Marketing • Symantec Director of Java and C++ tools • Apple Computer Senior Product Manager, MacOS • Claris Corporation (FileMaker, Inc.) Marketing Specialist • Digidesign, Inc. (division of Avid) Manager of US channel sales and marketing • Awards, SVPMA, interviews, books, etc. 3 ©2010 280 Group LLC
  • 4. 280 Group p The Product Marketing & Product Management Experts™ • Consulting & Contractors • Toolkits & PM Office™ (Product Manager’s, Roadmaps, Launches, Beta, Reviews, Competitive Analysis) • Training: public & private – PM Fast Track™ – Agile Excellence for Product Managers™ – Customer & Market Research – Effective Decision Making – Interactivity & Communication – Market Value Pricing – Personal Strategic Plans For PMs. – Time Management & Productivity – GREAT Demos! • Certifications: C tifi ti – Self-Study & In-Person Courses – Agile Certified Product Manager™ – Certified Product Manager™ – Certified Product M k i M C ifi d P d Marketing Manager™ ™ – Blackblot Product Management Professional 4 ©2010 280 Group LLC
  • 5. Special Offers • $20 off Competitive Analysis Toolkit • $100 off – Certified Product Manager (CPM) Self-Study Course & Exam – Agile Certified Product Manager (ACPM) Self-Study Course & Exam • $300 off – PM Fast Track 4 day course (NY Feb 22nd-26th) – Agile Product Management Excellence & Exam (Feb 27th) • Email therese@aipmm.com for discount codes 5 ©2010 280 Group LLC
  • 6. Value of Competitive Intelligence • To gain a thorough understanding of your industry • Identify key competitors and understand how the compete • Compare your product’s attributes to the competition • Make informed decisions on product planning and development 6 ©2010 280 Group LLC
  • 7. Four Step Process • Identify relevant competitors • Do in-depth research p • Create competitive analysis for internal use • Create competitive analysis & selling tools for p y g external use 7 ©2010 280 Group LLC
  • 8. Identify your key competitors • Only most relevant • Usually only 2 or 3 y y • Early markets may have up to 10 • 90/10 rule 8 ©2010 280 Group LLC
  • 9. Criteria for Choosing Competitors • Market share • p y Press/publicity • Mentions by prospects • Strength of solution g • Appearance in sales deals 9 ©2010 280 Group LLC
  • 10. Four Step Process • Identify relevant competitors • Do in-depth research p • Create competitive analysis for internal use • Create competitive analysis & selling tools for p y g external use 10 ©2010 280 Group LLC
  • 11. 9 Research Components • External Performance • Funding & Spending • Management • Attitude • Products • Positioning • Marketing • Distribution Channels • Market Share 11 ©2010 280 Group LLC
  • 12. Sources of Competitive Information • Obviously, publicly held companies will have more information available via newswires and financial statements • By nature, privately held companies may pose some diffi lt when searching f difficulty h hi for competitive information 12 ©2010 280 Group LLC
  • 13. Sources • Product reviews • Press articles • Financial statements “Risks and issues” sections • Press releases • Past versions of their website (Wayback Machine http://www.archive.org) • Specific/obscure/advanced searches: http://www.googleguide.com • Information on the sites of theirVCs • The company’s website: management, board, funding, # customers, • Interview current customers. • Analysts and market research reports: IDC Gartner etc IDC, Gartner, etc. • Hoovers http://www.hoovers.com • Silicon Valley startups: www.linksv.com • Company profile at www linkedin com www.linkedin.com • Dun and Bradstreet http://www.dnb.com. 13 ©2010 280 Group LLC
  • 14. Funding • Identify key sources of funding your industry • Compare and evaluate y p your competitors’ p sources of funding • Valuations • Burn rate/runway 14 ©2010 280 Group LLC
  • 15. Spending • What are they spending on? – Talent, marketing, facilities, manufacturing, R&D, etc. • Look for trends in competitors’ spending habits h bit • A high growth company in a new industry is going to spend differently than an established company in a low growth industry 15 ©2010 280 Group LLC
  • 16. External Performance • Obtain key quantitative performance indicators about your competitors • S l Sales, net i t income (l (loss), annual growth, fi ) l th financial i l ratios (i.e. assets to liabilities), inventory turnover • Identify trends about external performance • Public company: 10-K or quarterly release Balance Sheet and Income Statement • Private companies: press release on stage of funding 16 ©2010 280 Group LLC
  • 17. Management • Importance of identifying leadership within an organization – Example: Is the competitor founded by a group of engineers that do not have marketing experience? • Id tif i th management structure of a Identifying the t t t f company helps you learn who the decision makers are • Find out how well-connected company heads are within the industry/business world 17 ©2010 280 Group LLC
  • 18. Attitude • Goal is to find out how your competitors view the market • Aggressively expanding, conservative gg y p g, actions, risk taking strategies, etc. • Use a performance g to help identify the p grid p y current state of a company • Plot external performance indicators against various components of organizational health • Helps provide a sense of the type of company you are competing against 18 ©2010 280 Group LLC
  • 19. ce ternal Performanc The Performance G id Th P f Grid Troubled Successful Company Firm Crisis Complacent Low Company Ext Low High g Organizational Health 19 ©2010 280 Group LLC
  • 20. Products • Compare key product attributes across the competitive field • Answer important internal/external questions pertaining to your product • Identify what is important to the market and how your product compares to competitors • Use a BCG matrix to communicate product performance in terms of market share and growth rate 20 ©2010 280 Group LLC
  • 21. Example Product Comparison Template Level of importance to Feature Product 1 Product 2 the customer 21 ©2010 280 Group LLC
  • 22. BCG Matrix rowth Rate High H Stars Question Marks rket Gr ow Lo Mar Cash Cows Dogs High Low Market Share 22 ©2010 280 Group LLC
  • 23. Determine Competitive Positioning • Use data from their marketing & website • Brainstorm possible axes for chart p • Try multiple combinations 23 ©2010 280 Group LLC
  • 24. XY Axis Positioning Matrix Competitor Tag line supporting positioning goes here. 1 dvantag 2 Product ge Name Main Ad Competitor 2 Competitor 3 Main Advantage 1 M i Ad t 24 ©2010 280 Group LLC
  • 25. Four Quadrant Positioning Matrix Tag line supporting Competitor 2 positioning goes here. Product Name Competitor 3 Competitor Competitor 4 1 25 ©2010 280 Group LLC
  • 26. Marketing • Is their marketing effective? • How much are they spending? y p g • Do they have a strong brand? • Are they marketing or technology focused? y g gy • What tactics are they using? – SEO, PPC, white papers, ads, PR, etc. , , p p , , , 26 ©2010 280 Group LLC
  • 27. Marketing Research • Research on a competitor’s marketing efforts is different than other types • Look for marketing activity, financial statements, press releases • In addition, identify the marketing team, web offers • Use AdWords and SEO as tools 27 ©2010 280 Group LLC
  • 28. Distribution Channels • What channels do they use? – Direct, VARs, Web, Distribution, Partners • How strong is their presence? • Are there flaws in their channels of distribution? 28 ©2010 280 Group LLC
  • 29. Market Share • Identify the market size for your product • Who are the key players in y yp y your p product’s market? • How do you compare to others within your industry 29 ©2010 280 Group LLC
  • 30. Four Step Process • Identify relevant competitors • Do in-depth research p • Summarize competitive analysis for internal use • Create competitive analysis & selling tools for external use 30 ©2010 280 Group LLC
  • 31. Internal delivery: what’s included • Industry analysis • Life cycle position y p • SWOT analysis • Competitive Scope/Differentiation p p • Likely Moves • Market & Strategy Tools • Remember: Added security for sensitive information abou you p oduc /co pa y o a o about your product/company 31 ©2010 280 Group LLC
  • 32. Industry Specific Analyses • Use tools that can help communicate important components of your industry • Porter’s 5-Force Model – Include information on Barriers to Entry, Competitors, S C tit Suppliers, C t li Customers, and d Substitutes • Industry Life-Cycle Model – Help generalize direction of your industry 32 ©2010 280 Group LLC
  • 33. Porter s Porter’s Competitive Forces 33 ©2010 280 Group LLC
  • 34. Industry Life Cycle Model • Identify where your industry is • Review t e ds t at are co s ste t with industries in e e trends that a e consistent t dust es your stage 34 ©2010 280 Group LLC
  • 35. SWOT (Strengths Weaknesses Opportunities Threats) • Perform a SWOT analysis for each major competitor • Make a list of each of the following: – Strengths: internal things about your company and its market position that help your chances of success – Weaknesses: internal things about your company and its market position that weaken your chances of success – Opportunities: external things that help your chances of success – Threats: external things that weaken your chances of success • Fill in the SWOT matrix with strategies based on these factors 35 ©2010 280 Group LLC
  • 36. SWOT Analysis Strengths Weaknesses Strategies the company Strategies the company must deal with to take Opportunities nal can exploit to take advantage of advantage of opportunities Extern opportunities t iti Strategies the company Strategies the company Threats can use to defend itself must deal with to defend from threats itself from threats Internal 36 ©2010 280 Group LLC
  • 37. Competitive Scope/Differentiation • Review scope of the customer base – Broad vs. narrow (focused) scope of customers • Differentiation scale of the company’s products – Low and High Differentiation • Compare generic strategies of the products and th i owners using a matrix d their i ti 37 ©2010 280 Group LLC
  • 38. Competitive Scope and Differentiation Matrix Competitive Advantage p g Lower Cost Differentiation Broad Target 1. Cost Leadership 2. Differentiation Competitive Scope Narrow 3B. Differentiation 3A. Cost Focus g Target Focus 38 ©2010 280 Group LLC
  • 39. Likely moves • Draw conclusions about likely moves competitors will make • Discover how a product may likely evolve over a period of time • Use a matrix to compare markets and product development strategies • Use a roadmap to help visualize the industry landscape in the near to long-term 39 ©2010 280 Group LLC
  • 40. Market & Strategy Roadmap Your Competitor Competitor Competitor company 1 2 3 Markets Partner Build In- House Acquire 40 ©2010 280 Group LLC
  • 41. 2 Year Competitive, Market p , & Tech Trends Roadmap 2009 2010 * Competitor 1 expected release Competitive * Competitor 2 expected release Early Adopter Phase Market Widespread adoption Wid d d ti * New technology available to leverage gy g Tech * New technology available to leverage Trends * New technology available to leverage 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 41 ©2010 280 Group LLC
  • 42. 4 Year Competitive, Market p , & Tech Trends Roadmap * Competitor 1 expected release Competitive * Competitor 2 expected release Early Adopter Phase Market Widespread adoption * New technology available to leverage Tech * New technology available to leverage Trends * New technology available to leverage 2009 2010 2011 2012 42 ©2010 280 Group LLC
  • 43. Delivering the results • Choose a target audience for your findings • Relevant/sensitive information may be better y suited for a company executive instead of a potential investor • Condense your presentations for your target • Use what you learn to develop competitive selling tools for your sales force 43 ©2010 280 Group LLC
  • 44. Strategy for success • Develop an executive summary of your findings • Based on internal presentation • Convey what you need to do to win • Use this to gain funding & resources 44 ©2010 280 Group LLC
  • 45. Four Step Process • Identify relevant competitors • Do in-depth research p • Summarize competitive analysis for internal use • Create competitive analysis & selling tools for external use 45 ©2010 280 Group LLC
  • 46. External delivery • Added value for your customer (organize into a matrix) – Identify 7 key added values that your company can give to a customer – Identify 3 sources of the added value • Use a side by side Competitive Product Comparison with your most important competitor – Include a checklist, most important features listed , p first 46 ©2010 280 Group LLC
  • 47. Added Value Comparison Matrix [Your Industry] LEGEND [Your ■ YES □ NO ■ UNKNOWN Company] [Competitor 1] [Competitor 2] [Competitor 3] Added Value Category One Item 1 Item 2 Item 3 Added Value Category Two Item 1 Item 2 Item 3 Added Value Category Three Item 1 Item 2 Item 3 47 ©2010 280 Group LLC
  • 48. Competitive Feature Checklist/Comparison [Product name] [Main Competitor] Feature 1 Feature 2 Feature 3 Feature 4 Feature N • R Remember t i l d your U i b to include Unique S lli P Selling Proposition iti • Explain the benefits of your top features • This list can include as many features as you want 48 ©2010 280 Group LLC
  • 49. Deliver Effective Selling Tools • Competitive comparisons • FAQ for difficult questions q • White paper(s) on technical superiority • Talking p g points about each competitor p • Success stories/testimonials of customers who switched to your product y p 49 ©2010 280 Group LLC
  • 50. Summary • Value of competitive intelligence • Four step process for full analysis – Identify relevant competitors – Do in-depth research – Summarize competitive analysis for internal use p y – Create competitive analysis & selling tools for external use • Sources of competitive information – 9 research components h t • Delivering the results and effective selling tools 50 ©2010 280 Group LLC
  • 51. Special Offers • $20 off Competitive Analysis Toolkit • $100 off – Certified Product Manager (CPM) Self-Study Course & Exam – Agile Certified Product Manager (ACPM) Self-Study Course & Exam • $300 off – PM Fast Track 4 day course (NY Feb 22nd-26th) – Agile Product Management Excellence & Exam (Feb 27th) • Email therese@aipmm.com for discount codes 51 ©2010 280 Group LLC
  • 52. 280 Group Resources • Free templates and white papers • 2009 Product Management Survey Results • PM Job listing sites • 280 Group Product Management 2.0 Newsletter • 280 LinkedIn Group • Product Management 2.0 Blog • Books • PMA listings Go to www.280group.com in the “Resources” section. 52 ©2010 280 Group LLC
  • 53. Brian Lawley brian@280group.com www.280group.com www 280group com (408) 834-7518 53 ©2010 280 Group LLC

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