Making sure that your product has a competitive edge.
One of the most important steps when you are starting up or developing a new product or service is to find out how much you weigh against the competition. We all know how important it is to have a competitive advantage in order to increase the chances of your products or services success.
So how do you evaluate competitive edge? By running an effective competitive analysis.
Competitive analysis means:
“Identifying your competitors and evaluating their strategies to determine their strengths and weaknesses relative to those of your own product or service.”
Define the Problem and Find Competitors’ Products to Analyze
Once you have identified a problem you think you may be able to develop into a business opportunity, your first step is to research what products or services your target customers are currently using to solve the same problem. Is there an equivalent product or service out there? What are the alternatives people are using at the moment and how effective are they?
You can start your competitive analysis by identifying the top 3 to 5 competitors and figure out what it is that they are doing right. How well is the service designed or product integrated with its UX? Most of the times, it’s not about how the UX is designed, but how the entire service is designed is something which makes or breaks a product.
Once you have identified your top competitors, start organizing the list of competitors into a table:
A typical competitor table contains the following:
- Competitor’s name
- Competitor’s URL
- The number of users/downloads — mainly to identify the effectiveness of the platform
- Number of years the platform or product has been in use (optional)
- The main features being offered by competitors
- Cost of product or the service
- Any additional note
Here are a few steps to follow while running a competitive analysis:
1. Understand/Research the Competition
Every company starts with a purpose of solving a problem, but the companies which sustain are the companies which can constantly improve their offerings, their user experience and their overall process.
An effective research can be carried out by asking three things: the whys, the whats, and the hows behind your competitors’ products.