Conducting a competitor analysis can be highly valuable and should come early in a project. It will keep you focused on your goals, help you know your market and allow you to develop a viable product. Here are five steps to help you complete your competitor analysis.
1. List your goals
Your goals need to be clear and specific. I find that listing them in question form helps me get straight to the needs of the analysis quickly. Let’s say you are building a website for a home catering business, for example.
Why are you conducting this competitor analysis?
- The catering business is entering a new local market. We need to know as much as possible about local home catering companies and national brands in order to find gaps in the market and build attractive and competitive product features that will help us reach new local clients.
What do you hope to achieve?
- Refining our data to produce a clear list of other successful home catering companies and their particular features. This will help us create accurate user personas, user flows and competitive price points.
Will this research impact UX decisions?
- The client is launching a new business and a new website, so this data will directly impact the first design of the site and iterations going forward.
Keep your goals in front of you — print them out — while conducting your analysis so you can always refer to them quickly.
2. List 5–10 direct and indirect competitors
Direct competitors are businesses that offer the same products or service that yours does and target the same audience. Indirect competitors offer something within the same market, but vary from the main products services yours does. Examples:
- Direct Competitor: The Peppered Chef, offering affordable meal preparation for everyone in the Burlington, VT area. Personal chefs can prepare a meal of choice in the client’s own kitchen or can make multiple meals to store.
- Indirect Competitor: Honey & Olive, a restaurant offering order-ahead take out, cooking classes and event catering.
3. List similarities of competitors
When looking for similarities, it is a good idea to keep track of actions users can perform, paying special attention to the user journey of competitor products and services. Using a spreadsheet will help streamline the process.
Things to consider:
- What are the strongest features? The weakest?
- What do users mention in their reviews that might help in your research?
- Site design and aesthetic
- Tone and copy
4. Summarize your key findings
Now that you have your spreadsheet filled out, you can see what data seems most relevant. Write up a summary of strengths and successes in the market as well as gaps in the direct competition. Some of the criteria results can be translated into summary charts and graphs to better illustrate the information.
5. Present your UX competitor analysis
Compiling research will be useless if it isn’t translated to the right audience — your stakeholders and colleagues. You need to prepare a presentation, maybe including the ROI of your UX research.
Your presentation must be backed up with evidence. Show how your findings will impact the product through actionable items.
Take time to learn how to use your UX analytics effectively. In this article, Jennifer Cardello says that a common downfall with analytics is that it can become a “distracting black hole of “interesting” data without actionable insights.” Your evaluation and presentation of information will determine how valuable it is.