Consider that you are developing a new feature for your business and are quite confident that it will address a significant issue for your users. The catch is that you’re not playing this game by yourself. Your rivals are also vying for attention by developing features, launching marketing campaigns, and contacting the same clients you are attempting to attract. Knowing more than just their names or product attributes is not enough to win this race; you also need to be aware of their tactics, advantages, disadvantages, and maybe even potential weak points. Analyzing competitors is useful in this situation.
Think of competitor analysis as preparing for a game of chess: you don’t just focus on your next move; you anticipate your opponent’s too. It’s about understanding the moves on both sides of the board so you can plan strategically, respond effectively, and stay a step ahead. Let’s walk through how competitor analysis works.
What Exactly is Competitor Analysis?
Competitor analysis is like detective work for business. It’s a deep dive into understanding your rivals’ strategies—uncovering how they’re reaching customers, pricing their products, leveraging their strengths, and where they’re falling short. This knowledge equips you to enhance your own strengths, fill in gaps, and strategically position yourself in the market.
Here’s a simple breakdown of what competitor analysis entails for a B2B SaaS company:
- Direct Competitors: Companies offering similar products to your audience (think Salesforce vs. HubSpot CRM).
- Indirect Competitors: Those providing alternative solutions that meet the same needs but in different ways (like a CRM software competing with an all-in-one business management tool).
Competitor analysis focuses primarily on direct competitors but keeps an eye on indirect players who could pivot into direct competition territory.
Also Read: Understanding How Competitor Analysis and Risk Assessment Can Make or Break Your GTM Strategy
Why Bother?
Why is competitor analysis such a game-changer for SaaS companies? Consider these benefits:
- Strategic Planning on a Higher Level
Competitor analysis acts like a flashlight, illuminating the most strategic paths based on what’s already proven effective (or ineffective). It shows you where competitors succeed and fail, guiding you to adjust your strategy in ways that yield stronger results. - Launching Products with a Competitive Edge
A well-prepared competitor analysis ensures you know the script your rivals are following, allowing you to bring something fresh that captures attention. By understanding the landscape, you can tailor a launch that’s distinctive and avoids common pitfalls. - Repositioning and Brand Reinforcement
If you see that competitors are consistently engaging a specific audience or using a resonant theme, you can determine whether to differentiate or refine your brand positioning accordingly, allowing for a more strategic connection with your target market.
Conducting a Competitive Analysis:
Let’s explore each step in conducting a thorough competitor analysis for a B2B SaaS business.
Step 1: Identify Your Competitors
Finding competitors might seem straightforward, but it’s more complex than glancing at who’s around. Here’s how to tackle it:
- Conduct Market Research: Search for your service category online, scan industry forums, and explore niche platforms to find players you might have missed.
- Engage with Your Customers: Ask them what alternatives they’d consider if your solution wasn’t an option. They might reveal insights about unexpected competitors.
- Segment Competitors: Define direct competitors (offering a similar product to your target audience) and indirect competitors (offering alternative solutions to the same audience).
Step 2: Organize Your Findings Using a Competitor Matrix
To make sense of the data, you’ll need a Competitor Matrix—a structured table where you can lay out key metrics across competitors. Here’s an example format:
| Competitor | Product Features | Pricing Model | Promotion Channels | Customer Reviews | Target Audience |
| Competitor A | Comprehensive CRM | Subscription | Social media, email | Positive, consistent | SMBs |
| Competitor B | Advanced analytics | One-time purchase | Content marketing | Mixed, feature requests | Large enterprises |
This matrix serves as a visual representation of your findings and enables you to compare different strategies at a glance.
Step 3: Research Competitors Using the 4Ps of Marketing
To dig deep, we’ll use the 4Ps model—a tried-and-true method for organizing market research. This will ensure you cover each critical element of competitors’ strategies.
1. Product
Begin by investigating your competitors’ products like you’re analyzing a mystery case. Some questions to guide you:
2. Price
Pricing strategies in SaaS vary, from tiered subscriptions to pay-as-you-go. Here’s what to explore:
3. Place
Think of “place” as the distribution channels your competitors use. In SaaS, this usually includes digital channels but can vary widely.
4. Promotion
Finally, dive into how competitors get their product out there.
Step 4: Identify Their Target Audience
It’s crucial to know who competitors are targeting since it often overlaps with your own audience. Examine their social media followers, messaging, and customer interactions:
- What age groups, industries, or company sizes do they engage most with?
- Are there audience segments they’re missing that you could address?
Step 5: Perform a Competitor SWOT Analysis
Now that you’ve gathered the data, it’s time to make sense of it. A SWOT analysis (Strengths, Weaknesses, Opportunities, Threats) provides a structured way to assess each competitor.
For example, if you see a competitor excelling in customer support, consider how you can match or exceed that value in your service. If they have limited features, this could be an opportunity to enhance your product offering to fill that gap.
Step 6: Conduct a SWOT Analysis for Your Own Brand
Competitor analysis isn’t just about understanding others; it’s about seeing how you measure up. Once you’ve identified competitors’ strengths and weaknesses, turn that lens inward.
- Strengths: What aspects of your product stand out? Do you have a niche feature or exceptional service that resonates with customers?
- Weaknesses: Where are you falling short compared to competitors?
- Opportunities: Are there market gaps you could fill? Is there an underserved segment?
- Threats: What market changes, competitor movements, or emerging technologies could challenge your position?
This reflection will allow you to create a strategy that leverages your unique position in the market.
Step 7: Refine Your Strategy
Armed with this data, you’re ready to update your game plan. Adjust your marketing, product development, and even customer support strategies based on what you’ve learned. Competitor analysis is an ongoing process that should be repeated as markets change, new players enter, or industry trends shift.
Also Read: This playbook can increase your chances of marketing success by 674%
Final Thoughts
A strong competition analysis is your opportunity to remain proactive and flexible in a changing market, not just a static research study. You may modify your approach to take advantage of opportunities, reduce risks, and remain ahead of the competition by having a detailed grasp of them. Consider it a behind-the-scenes look into your rivals’ strategy, providing you with information that helps you make better decisions and maintain your SaaS solution not only competitive but at the forefront of the market.
