Imagine that I ask you to perform a competitive analysis for a potential product. What steps would you take?
Some companies operate in fast-paced and highly competitive markets. Principal product managers are expected to be able to assess their competitors and make recommendations for product strategy quickly and efficiently. Interviewers ask this question to test a candidate's ability to predict how product feature offerings will perform in their specific markets.
Remember to include activities involved in understanding your company's position within the market the product serves. This important information helps provide the context necessary for relevant and impactful competitive analysis.
"The first competitive analysis step I would take would be to understand my company's position. That includes assessing how well the product I am considering aligns to the company's mission and goals. It may also include performing a SWOT analysis to identify strengths that can be maximized, weaknesses to reduce, opportunities to capitalize on, and threats to mitigate.
Once I have the appropriate context, I would identify the top competitors and potential future competitors. I would perform a feature-by-feature comparison to determine the relative value of each product and any gaps that exist. This may include using demo versions of competitor products or posing as a customer to test how they perform in customer service scenarios.
Additionally, I would attempt to gather information on how much each company invested in its products, what current projects they are working on, and what kind of staff they employ. This information usually comes through direct conversations with peers and others in my network. I find this information helpful specifically when trying to mitigate threats or beat the competition to the market.
I would then compile all of the information I gathered and develop a big picture version to offer to senior leaders, peers, and stakeholders. I would review the major themes and offer detail information as necessary to help inform our decision of whether or not to move forward with development."
