Competitive Analysis for Sales

August 15, 2007

from PRODUCT MANAGEMENT CHALLENGES
A Weekly Newsletter of Tips For Companies that Develop Software

Competitive intelligence and analysis is a big part of any company's job, and is a duty that often falls to Product Managers. In 'Competitive Analysis: Ready When They Are, ' we looked at the topic of how to get a read on your competitors' plans and next moves. This discussion focuses on getting information so that your sales reps can sell better against the competition.

It's Like Gossip, But with a Purpose

Gathering information on competitors so that you can sell against them is a lot like gossiping, but with a very focused purpose. It's taking a lot of information that is floating around in conversations between teammates, much of which you don't necessarily hear, and putting it together in an orderly and systematic way.

Often, when all the information that your coworkers have is collected and compared side by side, certain competitive sales strategies and tactics suggest themselves.

The Internet Makes it Easy, But...

It's now very easy to get all sorts of information about companies and their products over the Internet. But most of it is the equivalent of brochures and collateral. It's the glossy, polished version of the company and its product that the company is working hard to portray.

It's important to search for information that is more critical and more analytical. And where can that be found? Actually, some can be found right on the Internet, especially by looking at reports by industry analysts.

But much of that critical information has to come from conversations with people who have some experience with the company, either as a research analyst, an employee, a customer, or a competitor. Getting that information is just as hard and time consuming as it always was.

Sales Reps as a Source

Your company's sales reps can be an incredibly rich source of information on your competitors. They hear about product features, people, and sales tactics when they talk with prospects.

In fact, this source of information is the one that is the most like gossip. It consists of many little bits and pieces that, once put together, can form a complete picture.

The key to getting sales reps to provide you with competitive information is to do the following:

  • Ask for the information regularly.
  • Provide competitive information promptly when a sales rep asks for it. That way he or she sees that the information he provides will be put to good use.
  • Promptly take any information provided by a sales rep and broadcast it to all sales reps, with thanks to the contributor.
  • Update your consolidated competitive information on the Intranet often, so that reps see that their contributions are included.
Types of Competitors

Lumping all competing companies in a single category called The Competition is usually a little too simplistic for your situation. There are different types of competitors, or products, that compete with yours in different ways.

Main Competitors. This is the half-dozen or fewer products that your sales reps run across again and again in competitive sales. Main Competitors are important enough that you want to gather as much information on them as you can.

Minor Competitors. These are usually products which are sometimes perceived as overlapping or competing with your product, but which are positioned to address a different target customer from yours. It's worth gathering very basic information on these and describing how to clearly differentiate your product from theirs. The information you gather might boil down to two or three paragraphs.

Potential Competitors. These are generally names that have been mentioned by prospects every now and then, or that you discover by reading press releases. These are usually products that sell in a target market next to, but not including, your own. It's important to keep tabs on companies that may POSSIBLY choose to extend their product to sell against you. Often sales reps are the first to learn about a potential competitor moving into your space.

Partners. Consider providing a simple analysis of the competitors and positioning of those products that you partner with. Sales reps are often thrown for a loop by challenging questions relating not to your direct competitor, but to a competitor of your partner's product.

Information to Track

There are various pieces of information you may choose to track. For sales, start with the basics that are the equivalent of a one-page company fact sheet: age of company, number of employees, products sold, and summary of the product.

The next step is to look for more specialized information that is particularly helpful for sales, such as alliances and partnerships, financial information, and information on individuals at the company.

Alliances and Partners

By analyzing and comparing alliances and partnerships, you can get an understanding of how partners are serving to drive sales specifically. Take a look at the customers advertised by the company, and try to find the 'trail to the sale.' This is an attempt to figure out what brought that prospect and your competitor together, and what relationship helped qualify your competitor in that sale.

For example, take a look at a company featured as a new customer in a competitor's press release, and see if that company is a member of any association where your competitor is also a member. That tells you that your competitor's lead probably came through that association.

Check any speaking engagements where your competitor has presented. You can figure out which of your prospects may have been there, and this provides the sales rep with a good question to ask those prospects that may lead to valuable information for the sale.

Find out if a recent customer has a tie to a company such as IBM or Accenture that is listed as a strategic partner by your competitor. It may be that the sale was initiated and facilitated through this partner.

Armed with information like this, your sales reps have a good idea of the paths your competition may take to get to your common prospects. They know to keep their antennae out for mention of companies that might bring in a competitor through their strategic alliance.

Financial Information

Financial information on your competitors is the most valuable for all sorts of uses, and the hardest to get. This is especially true if you're dealing with a privately held company.

Pricing information may be available from common partners, or from 'gossip' style info provided by prospects. One great source for pricing is articles where a clever journalist has managed to get an executive at your competitor to spill the beans.

Look for legal proceedings related to the company. Documents for these proceedings are public and often posted in their entirety on the Internet. Frequently there are details about pricing and financials that you can glean from them.

Individuals at the Company

Finally, you can find information on specific individuals at a company. Use the names of all the members of the management team to look for news reports and press releases, as well as legal filings. Some legal filings may be found through the name of the business owner rather than the company, because the actual holding or parent company name may be far different from the name used with the public.

Using individual names is also a good way to find information on presentations made to associations, membership in associations, and even message boards where former employees discuss their old company and boss.

After the Sale

Last of all, remember that some of the best quality information on competitors will come from your new customers, just after the sale has been made. During the honeymoon period, it's worth every minute of time from an executive at your company to make a courtesy call to the project sponsor. Make sure the discussion touches upon who was in the running against you, and why your customer chose you.

The assessment after the sale, with input from your customer, can provide details on price, sales tactics, and specific features that you may never obtain in any other situation.

Copyright (c) 2002-2004 Jacques Murphy. All rights reserved.

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