As a Product Strategist, there is one thing I have to always be blunt about. If you tell me “I’ve got no competition”, I’m going to tell you to be realistic.
Everyone has competition in one form or another. If a consumer has some sort of choice, then there is definitely competition. This is especially important if you’re raising funds. It shows you’ve done your due diligence and are realistic about the challenges ahead. To rapidly validate your competition, I suggest you create a value matrix. It will help you understand where you stand in the market and what makes you different.
To start off, grab a whiteboard or some sticky notes and sit down with your team or people you trust. Together, come up with every way to describe the product, just brainstorm words. For instance, let’s say you’re making a digital pet tracker app. Once you’ve got a big list, start googling different phrases, as well as things like “Pet Tracker” or “Fitbit for dogs”.
Open up all the results in browser tabs and read all of the pages. Knowing your enemy is important! Usually they have a features page. Open an excel document, or on your whiteboard write out the following. On the vertical axis, write “features”; and on the horizontal axis, write “competitors”.
On each features page, add the feature to that part of your matrix. Go through every result in Google and see what other companies’ value propositions are. Once you feel you’ve run out of logical competitors, add your product in. See if you overlap with anyone and see if you can see a gap in the value propositions. You should very easily be able to see patterns in the value propositions – you’ll be able to ensure you’re differentiated and not identical to another competitor. If you are identical, you need to be able to justify how you will do it better or execute it differently.
The earlier you run this, the better prepared you will be when you enter development. This also fits really nicely into your pitch deck and shows you’ve done some great research and your due diligence.
BONUS POINTS: To differentiate your competitors by segment instead of value proposition, you can present them on a market map like the one below. You could split it by expense along the axis or by sector focus.
This is the fastest way to run a competitive analysis. Doing this early on will help you develop a better product and position you for better execution.