In a world of data-driven decision-making, it’s essential to factor in what’s happening in the rest of the market. Your customers and prospects don’t live in a vacuum, nor can your product strategy. Implementing competitive intelligence as a strategy helps uncover future opportunities and risks. Harnessing a constellation of data from numerous sources and making sense of it all is integral to both short- and long-term success.
What is competitive intelligence?
Product teams typically focus their competitive intelligence on features and functionality. What do the other companies have that we don’t have? And what do we have that they don’t have, and where do we overlap?
But competitive intelligence spans much further than battle cards and feature sets. Competitive intelligence gives you a complete understanding of a competitor’s customers. Moreover, it provides insight into their ecosystem of suppliers and distributors. You can utilize this information to help decipher their messaging and sales tactics, and their pricing.
You’ll know which verticals, industries, and geographies they’re currently in and targeting next. And you’ll get a sense of their revenues, financial stability, leadership team, board members, and any future acquisition activity.
When properly synthesized and analyzed, these anecdotes and findings provide a fuller picture of the competitive landscape. Moreover, it helps define key competitors’ strategies. By understanding their product strategy, hopefully, some inspiration for how your product offering can outcompete them.
Competitive intelligence for product management
There are two broad types of competitive intelligence. Tactical intelligence focused on near-term market share capture and revenue generation. In contrast, strategic intelligence takes a longer-term view more concerned with risks and opportunities. It not only considers its current competition but whom it may battle in future markets.
Different stakeholders will want different types of competitive intelligence. The sales team wants the nitty-gritty details of a competitor’s pricing and terms (tactical), whereas finance needs to understand the total projected market size over the next five years (strategic) to triangulate revenue forecasts shared with investors. Product sits at the nexus and must be fluent in tactical and strategic competitive intelligence.
The product team will tap more tactical research when working with sales and marketing to build out battle cards or hone their messaging. Product will lean more heavily on strategic intelligence when roadmapping to ensure their products are built for tomorrow and beyond versus today.
8 Steps to implementing competitive intelligence
With a clear need for reliable, accurate competitive intelligence, the next hurdle is creating a scalable, sustainable approach to collecting and making good use of it. Luckily, keeping an eye on the competition isn’t a recent invention. For this reason, there are plenty of tried-and-true tricks of the trade to rely upon. Here are some pointers on making the most of your team’s efforts.
Build some consensus around the basics
Who are our competitors? What are our target markets? What verticals are we considering entering next?
These fundamental questions underpin your entire competitive intelligence initiative. Yet, you might find that if you asked everyone on the management team—let alone every employee—those same questions, you’d get different answers.
So instead of trying to answer these questions within the product team, practice a little stakeholder alignment and find some commonalities around these foundational elements. The exercise itself may illuminate and flesh out the broader competitive landscape.
Take stock and assess
There’s no lack of information out there. Savvy product teams will choose precisely the type of information they want. But this requires some intentional thinking and foresight.
Consider your current sources and their current value. If you’re putting that info to use, keep utilizing it. But if not, discard it because it’s just adding noise and no value.
Next, think about the information you or your colleagues in the organization would love to have. And not just as juicy gossip, but because it will help them do their job better.
By identifying these gaps, you can determine how to acquire further information. Some might just be a Google search away, so it’s about operationalizing that collection in those cases. But you might need to spend some money if it isn’t just sitting on the Internet.
Before investing too much time and energy finding, collating, and managing this information, find out who else in the organization collects or utilizes competitive intelligence. While the business may lack a dedicated team for this, someone in finance may collect competitor financial information or a sales enablement colleague maintaining a win/loss log containing clues on important missing capabilities or common frustration points.
Join forces with these colleagues to avoid reinventing the wheel and duplicating effort. Consider meeting quarterly to share intel and collaborate on mutual competitive intelligence needs. Furthermore, you can create a shared repository and communication mechanism for this info.
Map the product development lifecycle to implement competitive intelligence
Specific insights and analysis help inform competitive intelligence.
Look across the product development lifecycle and determine what’s needed in each phase. Marry this process with a calendar to ensure the information is ready without any last-minute scrambling.
This process is also a good check on defining what information you need. If data is being collected without ever getting used, maybe you don’t need to bother with that data at all.
Define roles and responsibilities
With a grasp on what’s needed, we must determine who does what. For small teams, this may sit with a junior product manager. Product operations is also well suited to own competitive intelligence collection and management.
What about the competitive analysis? This is where context is king. Getting that info to someone that can assess its impact on the business or product requires domain expertise.
But even a new feature offered by a competitor—which might seem like it falls under the product team’s purview—can also benefit from the context of a sales rep who recalls that a prospect told them it was must-have functionality. So while one party might make the initial judgment, aggregating input from across the team also has value.
Think beyond the feature set
Your competitor’s products and features are not the only things you should pay attention to. How a company tells its story, defines its audience, and differentiates its products will provide a sense of who they want to be and where they think they are going.
An announcement that a new head of sales with deep expertise in manufacturing may tell you something about the verticals your competition is prioritizing. A flurry of new job postings for engineers with expertise in Google cloud when their current solution runs only in AWS may give you a heads-up before the next sales encounter. You can leverage financial statements as a source of strategic information. Furthermore, presentations at financial analyst events are typically submitted to the SEC and posted on EDGAR.
Don’t overlook customers and prospects
Customers and prospects provide competitive intelligence on multiple levels. First, they tell you what features they need, what they wish they had, what they think they might need in the future, and what challenges they face and how they address them today.
Additionally, new customers just finished evaluating your competition’s offerings, and prospects are in the process of doing so. In deft and diplomatic hands, win-loss analysis can uncover valuable intel; for example, vendors failed to get a proof of concept integrated with a prospect’s key system.
Think creatively but mindfully about other sources
Beyond scouring your competition’s websites for details, product teams have plenty of avenues to research their competitors. Google alerts, LinkedIn groups, social media, industry trade groups and publications, industry blogs, and news sites provide a steady stream of updates.
Real-world activities also play a role, including conferences, trade shows, industry gatherings, and networking events. No blog post or LinkedIn update can hold a candle to a chat with the salesperson who just left your top competitor that you happened to run into at an industry meetup.
Market research companies may be worth considering if you’ve got some budget to play with. The players vary, but most industries get coverage from some sort of third-party research company.
For example, IDC, Gartner, and Forrester are three larger firms covering the technology products and services space, while a bevy of boutique firms focus on more specific niches and markets. Research firm analysts also frequently meet with players in their coverage area and can give feedback on how they perceive you. Proactively getting on analysts’ radar pays dividends both ways—they get to know another player in their space, and you get some insight along the way.
Handle with care
Regardless of how you implement your competitive intelligence information, you remain responsible for how you or your team use this information. A tidbit gleaned from a user group message board alone should probably not drive company strategy. Still, when that tidbit confirms some feedback from the latest round of customer satisfaction surveys, it may be worth a closer look. And while an optimistic third-party market forecast looks excellent in an investor deck, it won’t help you determine if your own revenue targets are realistic.
To ensure competitive intelligence efforts lead to better decision making. They don’t just create distractions, be careful not to open the floodgates and bombard everyone with headlines and rumors whenever they come across your desk. As with most things in life, less is more when implementing competitive intelligence, and a healthy dose of context should be doled out with every serving.