Competitive Analysis to Competitive Intelligence: Evolving for Greater Product Management Impact

Introduction

To pay homage, yet modify a quote from football coaching legend Vince Lombardi, “Competing is not a sometime thing; it’s an all the time thing.” Unfortunately, when it comes to the competition, product managers often postpone this important work to be a “sometime thing.” Most product management exercises are little more than creating feature matrices—using columns and rows to compare products to that of their competitors. They read more like a Consumer Reports product review chart.

For product management to build a better product and market it more effectively, competitive analysis must be used throughout an organization and, more importantly, be viewed as a strategic activity. In product management terms, this means not being viewed as a one-off, pre-launch activity but rather embedded in the entire product lifecycle: idea to launch to withdrawal. In this article, I’ll present information on why competitive analysis is so important, and give you some questions and a tool to help you improve your efforts.

The Importance of Competitive Analysis

Like the Clifton Strengths (formerly StrengthsFinder) skills assessment for members of a team, but designed specifically for product managers, 280 Group launched its first-ever 2019 Product Management Skills – Benchmark Report. In this report, they covered the competitive analysis skill set (dimension), alongside 14 other product management skill sets (dimensions) required to succeed. Each of the 15 skill sets were comprised of individual skills.

Here are some of the report’s finding and highlights, specifically around the competitive skill set:

  • Three weakest skill sets: end of life (EOL), competitive analysis, and pricing.
  • Weakest specific individual skill (among 74 skills): “I predict a competitor’s response to my next product’s release, and work with sales and marketing to counteract such responses.”
  • Competitive Analysis was the third most valued skill set when transitioning to a director-level, leadership-oriented role.

Chart showing competitive analysis at a top skill set for PM Directors

The Benchmark results show how crucial Competitive Analysis is to being an effective Product Manager.

Great Process Leads to Even Greater Output

While training is important, implementing a methodical competitive intelligence process matters even more. Implementing proper analysis enables the transition from collecting of raw data to distributing actionable intelligence.

Most product managers are familiar with the Stage-Gate® process for new product development; competitive intelligence has its own process and respective cycle. If done correctly, this intelligence cycle leads to producing competitive intelligence, not competitive analysis. Intelligence always follows analysis.

Here’s the basis for each of the intelligence cycle phases:

  • Planning – analogous to the gathering of product requirements
  • Collection – getting primary and secondary source information
  • Analysis – examination of the data collected to create insight, with an opinion
  • Delivery – reporting and visualization of the findings (outputs include product roadmaps, battlecards, and customer profiles)

The single biggest thing an organization can do to dramatically increase the skill sets of its Product Management teams is to establish and follow a consistent, best-practices-based formal Product Management Process. In particular, the training & process combination provides a 27.5% improvement for the competitive analysis skill set.

Interdependencies: “Competitive Analysis” and “Strategy” Skill Set

One of the key foundations of strategy is competitive intelligence. The report labels “I understand and know how to use key strategic tools like SWOT, Porter’s Five Forces, and the Chasm model, and determine strategy based on the stage of the product’s lifecycle” as an advanced “strategy” skill; however, it could very well be a “competitive analysis” skill. The Academy of Competitive Intelligence and pioneer Ben Gilad states, “The ingredients for a superior strategy are simple, straightforward, and intuitively appealing. Without an understanding of what makes a strategy superior for your company in your industry, analysis is a meaningless exercise in ad hoc crack thinking. It can often do more harm than good, as a company can easily dilute its strengths on a million so-called ‘opportunities’.”

Competitive > Competitor

Product management folks often make the mistake of focusing on the competitor when doing their analysis. While necessary, it’s not enough. The competitor should be at the core, while the surrounding competitive environment should be the forces that act on that competitor. They include demographics, economy, alternative industries, technology, distributors, customers, substitutes, suppliers, government, and industry regulations.

To get started, you could review your copy of Porter’s 397-page Competitive Strategy: Techniques for Analyzing Industries and Competitors book. Sound a little daunting? Get a quicker start by reading 280 Group’s article on Competitive Analysis, using the questions below, and assess where you should improve your competitive skills with the Scorecard.

What Questions Should I Answer?

Part of the intelligence process for any competitive professional is to create key intelligence questions (KIQs) and gets answers to those questions. From the survey, here are four that you can use:

  • Which competitors are likely to threaten your product or business?
  • What benefits does your product offer that are superior (or inferior) to that of your competitors?
  • How do your competitors offer their products to your customers?
  • How can you be clearer about differentiating advantages in your marketing?

How Do You Fare?

To find out how you fare in your competitive efforts, I’ve created a scorecard. Click here to download the scorecard and assess your competitive chops.

Download the Product Management Skills – Benchmark Report

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Get the results from the largest study on Product Management skills to date. Over 1,650 Product Managers rated their skills in 15 dimensions. See what it takes for PMs to advance in their careers, and how PM leaders can transform their teams to grow their skills faster.

About the Author

Alok Vasudeva
Alok Vasudeva
Alok Vasudeva is a technology research expert and co-founder of the Competitive Marketing Summit. He can be reached at alok@alokvasudeva.com.

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