Competitive Analysis: Old Skool vs New Thinking

The rules of the game have changed when it comes to competitive analysis.

Traditionally competitive analysis involved a deep dive into every player in the market, and feature by feature comparisons drawn up on a spreadsheet. But in today's hyper-competitive, global tech marketplace, this approach is as outdated as a dial-up modem.

The reality is, you can't possibly identify every competitor. And more importantly, you don't need to.

The secret to meaningful competitor analysis lies in understanding your best customers’ perspectives - what they believe to be their alternatives to your solution. And trust us, your customers aren't comparing every feature in a spreadsheet. They're evaluating options: do nothing, do it themselves, or choose a solution. These are the real competitors you need to focus on.

Let's start with what is often the toughest competitor of all: inaction. Especially during tough economic times, the desire to avoid risk and save money makes maintaining the status quo appealing if the cost of inaction and the value of change isn’t communicated strongly enough: 

The risks of doing nothing include: 

1. Unmet needs and lost opportunities.
   Problems persist, inefficiencies grow, and potential revenue is left on the table.

2. Competitive disadvantage.
   Technology is moving so fast that standing still actually means falling behind.

3. Hidden costs.
   Outdated systems, silos and manual processes drain resources and hinder growth.

4. Eroding customer satisfaction.
   Customers expect action, so inaction can lead to frustration and churn.

Now, let’s break down the new way to approach competitive analysis.

1. Identify the alternatives.
   Most tech markets have a predictable set of customer choices: 

• Around 2-4 main competitors: These are the ones your customers compare you to, their names come up time and time again, the ones you lose deals, RFPs to or staff to. 

• Inaction or "doing nothing": This could be due to lack of budget, inability to make a decision or the perceived risk of change) 

• "DIY" - building it themselves, solutioning with in-house resource or hiring additional resource

2. Understand your value.
   How does your solution stack up against these alternatives? What unique value do you bring to the table? 

3. Deposition against the competition.
   Position your offering as the superior choice compared to the alternatives. This is where you truly differentiate yourself and articulate your value.

By understanding the alternatives and positioning your solution as the answer, you can create a compelling case for change.

The results of this approach speak for themselves. We helped one particular client, who was expanding into Australia, hone in on their customers' perceived alternatives and define their strategic positioning. By understanding who and what they were up against, their sales team had much more confident and targeted value-based conversations with prospects. The result? They smashed their full-year pipeline target in the first quarter! That's the power of understanding your customers.

By shifting your focus to understanding your customer's perspective and the alternatives they consider, you can dramatically improve your competitive positioning and sales effectiveness. This customer-centric approach empowers you to pinpoint your distinct value and strengths, craft compelling messages, and confidently address customer objections. It's a strategic shift that can drive significant growth and market share.

Ready to apply this thinking to your business? Get in touch, and let’s start a conversation.  We're here to help Kiwi tech businesses grow.