ì  Competition Analysis A  Best  Prac+ce  Guide  For  Your  Marke+ng  Strategy  Process  

By:  Wayne  E.  Chen  

©  2011  –  Wayne  Chen  

Learning  Objective  

ì  Understand  the  compe++on  landscape  

ì  What  is  S.W.O.T.  

ì  Develop  internal  and  external  analysis  

ì  S.W.O.T.  results  and  ac+ons  

ì  Market  share  research  

ì  Product  posi+oning  &  map  

©  2011  –  Wayne  Chen  

Competition  Analysis  

ì  Develop  a  plan  to  beat  your  compe++on  ì  Reduce  expenses  ì  Get  crea+ve  ì  Deliver  customer  service  

ì  Developing  A  SWOT  Chart  ì  Self  vs.  Compe+tors  

 

 

©  2011  –  Wayne  Chen  

S.W.O.T.  Chart  

Strengthens   Weakness  

Opportuni+es   Threats  

©  2011  –  Wayne  Chen  

S.W.O.T.  COMPARISON  

ì  What  is  our  place  in  the  market  place?  ì  Market  size  and  whole  ì  Financial  posi+on  ì  Historical  performance  and  

reputa+on  

ì  Resource  comparison  ì  Human  Capital  /  Sales  ì  Technology  capability  ì  Research  &  Development  ì  Legal  /  Poli+cal  

©  2011  –  Wayne  Chen  

Identify  Strengthens  

ì  What  are  your  assets?  

ì  Which  asset  is  the  strongest?  

ì  What  makes  you  different?  

ì  Do  you  have  talented  teammates?  

ì  Do  you  have  a  broad  customer  base?  Is  it  growing?  

ì  What  unique  resources  do  you  have  in  your  arsenal?  

ì  Are  you  debt  free?  

ì  Do  you  have  strong  partners  and  supporters?  

ì  Will  you  be  cash  posi+ve  in  the  short-­‐term?  

ì  Do  you  have  specific  sales,  technical  or  marke+ng  exper+se?  

ì  Is  your  business,  product  or  service  scalable?  

ì  Can  you  capitalize  on  economies  of  scale?  

©  2011  –  Wayne  Chen  

Identify  Weaknesses  

ì  What  can  you  improve?  How  quickly?  

ì  What  necessary  exper+se,  or  technology  do  you  lack?  

ì  Do  you  have  adequate  cash  flow  to  sustain  you  for  3-­‐6-­‐12  months?  

ì  What  is  your  current  burn-­‐rate?  

ì  Do  you  have  outdated  technology  or  service?  

ì  Do  you  have  strong  profit  levels?  

ì  Do  you  have  a  well  of  new  ideas?  

ì  Can  you  execute  your  new  ideas  quickly  and  cost-­‐effec+vely?  

ì  What  is  your  marke+ng  and  opera+ng  cost  structure?  

ì  Do  you  have  too  much  debt?  

ì  Are  you  overinvested?  

 

©  2011  –  Wayne  Chen  

Identify  Opportunities  

ì  What  external  changes  present  interes+ng  opportuni+es?  

ì  What  trends  might  impact  your  industry?  

ì  Is  there  new  talent  and  where?  

ì  Can  repurposing  your  product  extract  new  value?    

ì  Can  you  reduce  your  service  or  product  offering  with  new  product  or  cost  models?  

ì  Can  you  fill  the  gap  of  your  compe+tors?  

ì  What  partnerships  can  be  formed?  

ì  Are  there  trends  emerging  that  you  can  profitably  service?  

ì  Can  you  reach  new  markets?  

ì  Can  you  capitalize  on  your  consumer  needs?  

©  2011  –  Wayne  Chen  

Identify  Threats  

ì  Is  there  a  be^er  equipped  compe+tor  in  your  market?  

ì  How  strong  is  their  execu+ve  team?  

ì  How  happy  is  your  staff?  

ì  What  if  your  customers  don’t  pay?  

ì  How  much  run-­‐way  do  you  have?  

ì  Is  your  IP  properly  secured?  

ì  Do  you  have  a  strong  customer  base?  

ì  What  is  your  cash  to  debt  ra+o?  

ì  What  if  your  service  or  product  is  pirated  or  hacked?  

ì  Are  you  dependent  on  key  suppliers?    

©  2011  –  Wayne  Chen  

Types  of  Competitors  

You  

REPLACEMENT  

DIRECT  

POTENTIAL  INDIRECT  

REGULATORY  

©  2011  –  Wayne  Chen  

Direct  Competitor  

ì  Offer  the  same  products  with  the  same  game  

ì  Generate  the  same  revenue  and  have  the  same  channel  ì  Head-­‐to-­‐head  

ì  More  generic  =  for  everyone  

ì  Compe+ng  solely  on  price  

©  2011  –  Wayne  Chen  

Indirect  Competitor  

ì  Offer  the  same  products  but  have  a  different  goal  

ì  Does  not  drive  revenue  the  same  way  

ì  Content  marke+ng  ma^ers  ì  Strong  marke+ng  ì  Large  adver+sing  budgets  

 

©  2011  –  Wayne  Chen  

Replacement    Competitor  

ì  Consumer  can  choose  your  product  

ì  Same  resources  they  could  have  commi^ed  to  your  product  

ì  Must  listen  and  interview  consumers  to  gain  why  they  go  for  the  alterna+ve  

©  2011  –  Wayne  Chen  

Regulatory  Competitor  

ì  Local,  State  and  Federal  agency  

ì  Regula+ons  ì  Statutory  ì  Policy  ì  Alliance    

ì  Lobbyist  

ì  Poli+cal  

©  2011  –  Wayne  Chen  

Leverage    S.W.O.T.  Analysis    

ì  Take  ac+on  on  results  

ì  All  this  data  enables  you  to  do  the  following:  ì  Improve  your  strengths  ì  Eliminate  weaknesses  ì  Leverage  opportuni+es  ì  Defend  your  business  from  

threats  

©  2011  –  Wayne  Chen  

Take  Action  

ì  Guideline:  ì  What  can  I  do  to  make  my  

strengths  even  more  powerful?  

ì  What  do  I  need  to  change  to  eliminate  or  minimize  my  weaknesses?  

ì  How  can  I  use  the  opportuni+es  to  my  advantage?  

ì  What  should  I  do  to  protect  my  business  from  emerging  threats?  

ì  S.W.O.T.  Analysis  Trap  ì  Jus+fy  ac+ons  and  decisions  

ì  Objec+ve  on  ì  Previous  decisions  ì  Weaknesses  and  threats  ì  Internal  reflec+on  

©  2011  –  Wayne  Chen  

Potential  Competitor  

ì  Service  and  products  that  may  appear  at  some  point  in  the  future  ì  Direct  or  indirect  

ì  Can  impact  your  business    

ì  Monitor  purchasing  habits  

ì  Environmental  and  industry  changes  

ì  Ver+cal  growth  and  expansion  

©  2011  –  Wayne  Chen  

Market  Shares  -­‐  Players  

ì  Market  share  leverage  is  a  key  concept  to  consider  when  examining  market  shares  within  an  industry    

ì  The  bigger  the  pie,  the  bigger  the  profit  ì  Produc+on  costs  per  unit  

ì  Crea+vity  through  small  shares  

©  2011  –  Wayne  Chen  

Product  Perceptual  Map  

ì  A  graphic  way  to  view  and  compare  your  product  against  the  compe+tors’    

ì  Grid  by  Price  and  Quality    ì  Determining  known  

markets  and  un-­‐served  

ì  Percep+ons  importance  ì  Quality,  strengthen,  and  

appeal  

©  2011  –  Wayne  Chen  

Product  Positioning  

ì  Product  evolu+on  

ì  Unique  Selling  Proposi+on  (USP)    

ì  Product  Image  

ì  Product  Posi+oning  ì  The  importance  of  produc+on  

percep+on  vs.  physical  a^ributes  

©  2011  –  Wayne  Chen  

Ten  Ways  To  Conquer  Product  Positioning  

1.  Posi+oning  begins  with  the  name    2.  Unique  products  require  new  names  3.  Be  the  first  to  own  the  word  4.  Reinforce  the  original  concept  across  all  ac+vi+es  5.  Introduce  a  new  brand  not  blurring  the  original  6.  Establish  a  new  category  and  brands  that  are  tough  to  

beat  7.  Find  an  open  posi+on  in  the  consumer’s  mind  8.  Reposi+on  the  compe++on  to  undercut  leader’s  product  9.  Be  consistent  with  your  posi+on  always  

©  2011  –  Wayne  Chen