Competitive Analysis for B2B product managers (Part 1)

Importance of being competitive aware and the types of intel to gather

Part 1

The common adage for B2B SAAS (or any business for that matter) is not to care about your competitors. Legendary companies like Apple and Amazon have said that they are relentlessly focused on the customer. If you are customer obsessed you will be ahead.

That’s very true and one should not take the eye off customer obsession. However, your competitors are likely doing the same. And in a battle of words and positioning and imaging, it’s critical to know how your competitors are attacking the market where you are playing. You can be completely customer focused just like your competitor, but somehow they may be able to find an angle of entry that gets them more wins.

In the first part of this competitive intel series, we will discuss the importance of competitive analysis and what type of intel you need to gather.

In the second part, we will discuss the sources of gathering competitive intel.

I recently heard a term from April Dunford who says “Be customer focused, but be competitor aware”. That is a good way to sequence how one thinks of competition.

Does it mean you need to copy your competitor. Absolutely not. In fact, competitor aware means you understand the positioning, segmenting, pricing and other go to market aspects your competitors are using. Your product and how it adds value to your customers is your secret sauce based on your own discovery and validation. There is no need to change or copy your competitor. More important is to understand how they are entering the mindset of your targets.

Competitive analysis is akin to the pre-game preparation of a basketball team. Just like athletes meticulously study their opponents' playing styles, strengths, and weaknesses, B2B product managers delve into a thorough analysis of their competitors. By scouting rivals, product managers gain valuable insights into market trends, customer preferences, and emerging technologies. This knowledge equips them with the strategic playbook necessary to outmaneuver their competitors and win in the highly competitive business arena.

Do you need to follow and track all your competitors?

That depends on your industry and the specific use case you are trying to solve for. But in general, I recommend focussing on 2-3 competitors who always show up in your target prospects. And always be on watch for new and upstart competitors.

What to look for in a competitive analysis?

As a B2B product manager, there are three categories to look for in your competition.

Product Capabilities

Conducting a thorough competitive analysis is a standard practice for product managers, and one of its key areas is understanding the product capabilities of your competitors. While it's relatively easy to gather a list of features by exploring their websites, support documentation, and even product demonstration videos, the real value lies in interpreting these capabilities and identifying the pain points they address—or fail to address.

When examining your competitors' offerings, pay close attention to areas where they fall short. For example, if you provide intuitive reports and dashboards that outshine your competitors, leverage this advantage in your messaging. Similarly, consider the target personas your product caters to. If your competitors neglect specific personas, such as executives, emphasize how your solution empowers them to gain a comprehensive understanding of the big picture of the business. If your target is enterprise, then check how your competitors address enterprise needs.

Equally important is uncovering the "secret sauce" of your competitors—the unique selling proposition that sets them apart in their customer communication. By understanding their key messaging points, you can position your own unique value proposition in a way that outshines the competition. This knowledge ensures you are not caught off guard and allows you to effectively differentiate and highlight the strengths of your own offering.

In summary, analyzing the product capabilities of your competitors goes beyond simply listing features. It involves assessing how well they address customer pain points, identifying areas of advantage, targeting underserved personas, and positioning your own "secret sauce" for maximum impact. By gaining a deep understanding of your competitors' strengths and weaknesses, you can refine your own products position.

Product Positioning

Analyzing a competitor's product positioning is essential for a B2B product manager to understand the landscape. When examining a competitor's positioning, consider the following points:

1. Vision and Mission: Start by understanding your competitor's vision and mission statements. These provide insight into their long-term goals, their intended market positioning, and the problem they aim to solve. By aligning their vision with their product features and messaging, you can gain a deeper understanding of their strategic direction.

2. Target Market Segment: Identify the specific segments that your competitor primarily focuses on. Analyze whether they prioritize specific geographical regions, target particular industries, or cater to specific types of companies. Understanding their primary market segment allows you to evaluate their level of specialization and identify potential opportunities in other underserved segments.

3. Highlighted Advantages: Determine the advantages your competitor emphasizes in their product messaging and marketing materials. Look for features, functionalities, or value propositions that they consistently promote as their unique selling points. This analysis helps you identify their perceived strengths and areas where they aim to differentiate themselves from competitors.

4. Unhighlighted Advantages: Identify advantages or key value propositions of your own product that your competitor may not be highlighting. This can be a valuable opportunity to differentiate yourself. For example, if your product excels in data security, but your competitor does not emphasize this aspect, you can leverage it as a key selling point to position yourself as the preferred choice for security-conscious customers.

5. Messaging and Positioning Tactics: Assess the language, tone, and style your competitor employs in their messaging. Consider the key pain points they address and how they position their product as the solution. Evaluate their marketing channels, content strategy, and customer communication to gain insights into their overall positioning tactics. This analysis helps you understand their messaging approach and can inform your own positioning strategy.

6. Pricing and Packaging: Explore how your competitor structures their pricing and packaging models. Analyze their pricing tiers, contract terms, and any bundled offerings. Understanding their pricing strategy can help you assess their target market segment and potential pricing advantages or gaps that you can leverage to position your product effectively.

By thoroughly analyzing your competitor's product positioning, including their vision, target market segment, highlighted advantages, and unhighlighted advantages, you can gain valuable insights into their strategy and identify areas where you can differentiate yourself. This knowledge allows you to refine your own product positioning, messaging, and marketing tactics, positioning your solution as a compelling choice for customers in the competitive B2B market.

GTM Execution

In the B2B realm, prioritizing the overall customer experience holds more significance than solely relying on product features. Even if you have a superior product with impressive technical capabilities, if your competitor excels in areas such as support, customer success, training, documentation, change management, or migration, you may find yourself at a disadvantage. Therefore, analyzing your competitor's GTM execution is crucial for product managers. Consider the following points to gain insights into their customer experience strategy:

1. Sales Model: How do your competitors sell? Is it sales led or product led, or something else. Where do they promote their products - on social, on ads? What key messages are they highlighting.

2. Support and Customer Success: Evaluate how your competitor handles customer support and customer success initiatives. Assess their responsiveness, availability of support channels, and proactive engagement with customers. Look for indicators of strong customer relationships, such as personalized assistance, dedicated account managers, and effective issue resolution processes. Understanding their approach to support and customer success will help you identify areas of improvement for your own organization.

3. Training and Documentation: Examine the training programs and documentation provided by your competitor. Assess the comprehensiveness, accessibility, and clarity of their training materials and documentation. Look for self-service resources, user guides, tutorials, and knowledge bases that empower customers to maximize their usage of their products. Analyze the quality of their training programs, including webinars, workshops, or certification programs, to determine how well they equip customers to succeed with their product.

4. Change Management and Migration: Consider how your competitor addresses change management and migration processes. Evaluate their approach to onboarding new customers, managing software updates, and assisting with data migration from legacy systems. Look for indicators of seamless transitions, clear communication, and effective change management practices that minimize disruption and ensure a smooth customer experience during implementation.

5. Overall Customer Experience: Consider the broader customer experience beyond the product itself. Assess how your competitor fosters long-term relationships and builds customer loyalty. Look for initiatives such as user communities, feedback loops, user conferences, and customer advisory boards that demonstrate a commitment to customer engagement and satisfaction. Additionally, analyze their post-sales support, account management practices, and strategies for gathering and incorporating customer feedback into product development.

Remember, in the B2B landscape, customers often prioritize a holistic and positive experience over purely technical features. By thoroughly examining your competitor's GTM execution, focusing on areas such as support, customer success, training, documentation, change management, and migration, you can identify gaps or areas of improvement within your own organization. This analysis enables you to enhance the overall customer experience, positioning your product as a compelling choice for customers seeking not only advanced features but also exceptional support and a seamless journey with your solution.

Whose job is it to gather competitive information?

Most organizations would have their product marketing functions do the competitive analyses. But it should be a team effort. Foster collaboration among different teams within your organization, such as marketing, product management, customer success, and engineering. Encourage open discussions about competitive insights and encourage team members to share their observations and experiences. By leveraging the collective knowledge and expertise of your teams, you can develop a comprehensive understanding of the competitive landscape and identify opportunities to win.

Gathering competitive analysis is not a one time activity. It’s an ongoing task as competitors also evolve. Once you have the analysis, use it in your marketing and positioning. Highlight areas where you are strong but no other competitor is close. If your competition is strong in an area, then highlight your own strong points and why they are more important.

Sometimes it is not even necessary to add a feature to be at par with your competition. For example, a competitor may be promoting a new AI tool to help solve a problem. Your product likely solves that problem, and you can mention your product is better because of your unique way that has higher accuracy. Or some other benefit of your solution. The key idea you are trying to put in your target’s mind is your solution is already better.

Having said that, in some cases you probably will want to add features you are lacking that your competitors have. You cannot escape that. Imagine you and your competitor equally solve a key pain point for a given segment of customers. But they have HIPAA compliance baked in. It’s natural they will have an edge in sales, and you will have no choice but to add the same feature for HIPAA compliance. Nothing wrong with that. There will be gaps in your product that you will want to address in your roadmap. Consider these gaps as part of your backlog and prioritize per your strategy. You will face pressure from sales to add features to combat competition. Do consider and listen to them. When and how you address these gaps is based on your product sense.

Thee key message here is not to copy your competition but be aware of them in the market.

In the second part, we will discuss where and how to gather competitive information.

To be continued…..