As entrepreneurs, we have a natural tendency to compare ourselves to our competitors; but we do this based on a biased perception of what we think they provide. In reality, only a thorough and concrete analysis of the competitive landscape – one in which you compare yourself based on real, concrete attributes of your product or service – can give you insightful information.
Building a strong competition map is an integral step of Bridge for Billions’ online incubation program. Today, we’ve decided to share with you some of the actionable advice of our methodology. To get started, you will need to analyze four different aspects of your business so that you are able to position yourself at the most suitable place in relation to your competitors.
1) Single out Your Attributes
You must be able to identify the strengths that your product or service has. First, you must focus on your product’s strengths from an internal perspective. What are its positive attributes? Is it easy to use, colorful, intuitive?
Once you know the attributes of your product/service, you must look at it from an external perspective. How does your product improve upon your competitors’ products? What makes it better? What would your potential customers like most about it?
All of these questions are essential to your understanding of your business. Without being able to clearly see its strengths, it will be much harder to design your marketing and branding in a unique manner.
Knowing your strengths compared to your competitors is also important to ensure you can sell your product to investors, and convince them of the merits of your products or service.
2) Identify what your Product Lacks
In comparison to your competitors, which attributes is your product missing? Identifying its weaknesses is as important as identifying its strengths. No product is perfect, and it could always be improved – knowing exactly how is extremely helpful. You can start by identifying the areas in which your competitors beat you.
Not only will this help you to decide how you can improve your products, but investors will appreciate that you’re aware of the improvements needed and that you’re committed to actually implement them. Even if you can’t for now, it’s important that you have knowledge of them: you’ll still be able to plan for the future and have a clear vision of a product roadmap, or how your service should be developed.
3) Explore your Competitive Landscape’s Opportunities
It’s important to know your competitive landscape, and how you sit within it. Start by finding out who are your direct competitors, meaning companies that offer similar products to yours – products your customers could potentially prefer. For example, direct competitors to a car company would be other car companies like Honda, Ford, Acura…
Once you’ve found them, you need to map out your indirect competitors. These are competitors who fulfill the same needs that you, but that don’t necessarily provide the same product or service. Car companies answer people’s need to get around, but so do bikes and metro. This makes bike companies and public transportation their indirect competitors. As a consequence, car companies need to take them into account when building their strategy – and so should you.
4) See How You Compare to Your Competitors
Last but not least is seeing how you match up to your competitors. Taking into consideration both your direct and indirect competitors, you need to be able to see where you’re doing better and where you’re doing worse.
Mapping your competition definitely brings to light invaluable information about your business. It helps you build a stronger product, improve your marketing, and prevent possible catastrophes. You must have a clear vision of what your competition offers to your clients, and how you stack up in comparison.
Again, investors are always interested in knowing if you can clearly draw your competitive landscape and explain your product advantages and weaknesses, and how to improve upon your product – all which becomes obvious through a competition map.
At Bridge, we’ve transformed all this actionable advice into an intuitive online tool, which allows you to visually position yourself in comparison to your competitors: the Competition Map. We aim to guide you through your competition landscape, and help you analyze your position in relation to your competitors, with the help of our community of mentors.
Want to find out about the other tools from our program? Download the Full Program Description or take a look at our website.