How to identify which competitor to watch and analyze
Last week, I had the opportunity to give a presentation at Berkeley Skydeck on how to conduct competitive analysis.
One of the questions that came up was: “Who are my competitors?”
It’s a great question—and one that every founder and product manager needs to answer, especially when pitching to investors or carving out your position in the market.
In some industries, like marketing automation or CRM, you might have hundreds of competitors.
But here’s the thing: Do you need to track every single one?
The short answer is no. Instead, focus on a select few.
Who Should You Track?
In general, I recommend focusing on 2-3 competitors who:
• Consistently show up in conversations with your target customers.
• Represent the biggest threats or opportunities in your space.
And don’t forget to keep an eye on emerging or upstart competitors—new players can disrupt the landscape quickly.
How to Identify Your Competitors
To determine who to track, I use a simple but effective framework created by Myk Pono:
Here’s how it breaks down:
- Direct Competitors:
These companies:
• Solve the same problem,
• Target the same customer type,
• Offer a similar solution.
These are the competitors you need to analyze closely. If there are more than five, narrow it down to the three that show up most often in your sales conversations.
Example:
• Trello: Targets teams looking for collaborative task management with a visual board-based approach (like Asana).
• ClickUp: A feature-rich project management tool also aimed at businesses seeking team collaboration and workflow management.
- Adjacent Competitors: Different Problem
These companies:
• Target the same customer type,
• Offer a similar product,
• Solve a different problem.
They may not seem like a direct threat today, but if they’re well-funded, they could expand their offerings and encroach on your space.
Example:
• Slack: While not a direct project management tool, Slack targets the same customer base (teams needing collaboration) but focuses on communication rather than task management.
- Notion: Offers flexible tools for documentation, note-taking, and knowledge management, which may overlap with project management but isn’t its core focus.
Why Keep an Eye on Them: If these companies decide to expand their offerings (e.g., Slack adding task management features), they could become direct competitors.
- Different Customers, Same Problem:
These competitors:
• Solve the same problem,
• Offer a similar solution,
• Target a completely different customer base.
You’re unlikely to compete with them directly—unless they expand into your market.
Example:
• Wrike: While it’s also a project management tool, Wrike primarily focuses on enterprise-level customers with complex workflows and integrations, as opposed to small and medium-sized businesses.
• TeamGantt: Solves the problem of task and project management but caters to smaller teams or freelancers looking for Gantt chart-specific solutions.
Why Watch Them: If these competitors decide to expand their market to include your target audience, they could disrupt your space, especially if they bring established enterprise resources or niche expertise.
- Inferior Solutions, Same Market:
These companies:
• Target the same customer,
• Solve the same problem,
• Use a less effective or outdated solution.
These competitors present an opportunity. If your solution is superior—faster, easier, more scalable—use them as a frame of reference to highlight your strengths.
Pro tip: Some companies in category #1 might also belong here if your product significantly outperforms theirs.
Example:
• Microsoft Project: While widely known, Microsoft Project is often seen as clunky, overly complex, and outdated compared to modern project management tools like Asana.
• Basecamp: Offers basic project management features, but its simplicity and lack of customization might not meet the needs of more sophisticated teams.
Why Leverage Them: These competitors are an opportunity to differentiate. Highlight how your product is easier to use, more modern, or better aligned with your customers’ needs.
Example in Action
Here’s how this framework could look when applied to a real-world example:
By categorizing competitors into these groups, you can decide who to focus on and how to differentiate yourself effectively.
Presenting Competitors in a Pitch Deck
Once you’ve identified your competitors, the next step is presenting them to investors. There are two common methods:
- The Two-Axes Method:
This is a popular choice because it’s simple and visually intuitive.
• Choose two axes that represent the key value propositions where your product excels.
• Make sure these axes are highly relevant to your target customers.
It looks like this.
-
- The Matrix Method:
While this method provides more detail, it can overwhelm your audience. Stick with the two-axes approach unless you have a very compelling reason to go deeper.
It looks like this
Don’t confuse this with the matrix you typically see in industry reports such as G2. They are more representing the landscape overall without getting into differences.
Conclusion
If you’re unsure about which competitors to focus on, try using the Myk Pono framework to gain clarity.
Competitive analysis doesn’t have to be overwhelming—just strategic.
What frameworks or methods do you use to analyze your competitors? I’d love to hear about them in the comments!
Read more : Source of competitive analysis
