We all constantly make comparisons against our mental model; one might even claim that our day-to-day, moment-to-moment lives are dominated by our interpretation of our experiences, rather than some objective reality.
We all constantly make comparisons against our mental model; one might even claim that our day-to-day, moment-to-moment lives are dominated by our interpretation of our experiences, rather than some objective reality. Because of this, it is extremely easy--expected, really--to fall victim to confirmation bias and find oneself within an echo chamber.
In the business world this can be fatal, often leading to the dreaded “lack of Product-Market fit”. Established businesses are somewhat buffered by their size and longevity, with many perspectives available (even if they go generally unheeded). The picture is far worse for start-ups: with little customer history as guidance, a strong bias for action to “just get it done”, and the personal vision of a small team at its core, products can be conceived, built, and delivered without ever brushing up against reality.
What to do?
There are several recognized tools to sidestep bias and escape the echo chamber; in this post, I’ll discuss and give an overview of Mat3ra’s approach to the competitive analysis.
HubSpot defines the competitive analysis as “A strategy that involves researching major competitors to gain insight into their products, sales, and marketing tactics” which one pursues with the goals of “Implementing stronger business strategies, warding off competitors, and capturing market share”.
As the goal of this post isn't to publish a textbook, I’ll propose a slightly simpler take: “Our competitors are pretty smart, too. Let’s learn what they do (and why) to inform what we do (and why)”.
Equally important to what a competitive analysis does is what it does not do.
As with any initiative, the constraints we select will govern the effort and results. As a start-up with limited resources, we strive to make our analysis MAT: Measurable, Actionable, and Timely.
Next, we select competitors for analysis. This is largely an exercise in area expertise supplemented by keyword searching by relevant industry terms. We constrain our analysis to competitors with similar products and services.
Note: when appropriate, include your company as part of the analysis, adopting the perspective of an outside observer. In other words, how would you rank your own company if you were performing this analysis as a competitor?
A snapshot of our final competitive analysis is below. Note that the metrics (Row 1) are well-defined and quantitative. Additional subjective information (such as organizational strengths and weaknesses, product strengths and weaknesses, and messaging) are kept separate for subsequent analysis. Our analysis allows us to look at any given competitor to understand at a high level how they are similar to and how they differ from Mat3ra.
This is actionable at both the strategic and the tactical levels. Strategically, we can look at a given competitor’s focus and understand where Mat3ra should and should not seek to learn from their approach. For example, a customer focused on late-stage R&D will necessarily approach messaging on their website differently than Mat3ra should. Tactically, our external team is now armed with a powerful tool to quickly and consistently answer the question, “What makes you different from XYZ competitor?”.
Armed with an objective competitive analysis, we no longer must integrate competitor actions and messages into our mental model--an external, quantifiable set of metrics now exists and is always available. Furthermore, when considering customer conversations and choices, we may now recognize and categorize them based on our fit into the larger market, not simply how they fit into our assumed profile.
What does this really mean? Ideally, when faced with new customers, competitors, or product information, our intuition is supplemented--and the risk that the echo chamber governs our actions is reduced. We have striven to make our analysis actionable, but that still requires that action be taken.
More posts on this topic, further explaining our approach to follow soon! Reach out to us if you are interested in the landscape of materials informatics and digital R&D to discuss further.
