Market Research and Eyeing on Competitors

26 Oct 2014 . category: product-management . Comments
#entrepreneurship #startups

In this post, I will be talking about how to do market research as a PM so we can make the decision whether or not to proceed based on its worth and at the same time on learning about our competitors.

The first question we start with is how much revenue do we make if taken this opportunity we are trying to address?.

Evaluate the opportunity

To get an estimation for this we look for players in the same space as ours and find what’s their revenue/customer base. Though we at Zapstitch are way different from what Zapier does, I can take it to answer above question since it is in the same space. Say, Zapier’s customer base is 50,000 then if we capture even 5% of theirs then it is 2,500 customers and if we charge an average price of 50$ from each, then we make 125,000$/month. Note 1: Above numbers are just randomly taken for example. Note 2: Factors like customer persona and others change this estimation in reality, but it‘s a good way to start.

Know your competitors

Identifying competitors are crucial for us as product managers. We always need to know who our competitors are and what’s their status. To be honest market researchers and market research agencies has tons of ways and practices to find the list of them but I shall share how we can take advantage of Google and find them through our little real effort.

1. Versus

I can just google “Zapstitch versus Zapier” and also consider other autosuggestions shown after I typed “ZapStitch versus “

2. Keywords in problem statement

For our product, I can use something like “connect Shopify to QuickBooks”, “move data from Shopify to QuickBooks”, “automate Shopify and QuickBooks”. Or can be more product specific features also as “move inventory in Shopify to QuickBooks”, “bring variants in Shopify to QuickBooks items list” and so on..

The idea here is to think like the customer and guess how they complain; this is one of the reasons we need to spend more time talking to customers, so we get their language and use same for marketing purposes as well as for market researching.

Tip: Enclosing a phrase between double quotes is used for hard search in Google. Example: “connect Shopify to QuickBooks”.

Since we connect other apps at Zapstitch, these apps have their community forums, so we hang out there also to know about our competitors.

Once we get a list of competitors, each can be categorized into one of the below -

Types of competitors

1. Direct Competitors

This category is for those players who focus on the same problem as we target and so same target audience. To put it simply, customers evaluate us against them to decide which product and whose service to take. Recently, one of our new signups replied to our welcome email saying how are we better than Webgility?.

2. Indirect Competitors

Players who don’t address the problem we solve to the fullest or directly. Zapier is a good example for us at ZapStitch. Zapier can help Shopify data copy into Quickbooks, but it will be in all bits and pieces because they make any connection only at the surface level more like IFTTT (if this then that). Also, data copies only from time links are set, while we at ZapStitch do it for past data also and set the deep connection so that all accounting reports shine and are ready in QuickBooks perfectly.

3. Potential Competitors

During my interview, I asked my founders what if Shopify and QuickBooks partner and build the similar application like what ZapStitch is trying to do? Yes, it is possible, right? Since there is a chance for that, they are known as our potential competitors. From day - 1 we need to keep planning all possibilities so that they can never take on us. Taking advantage of their engineering team, user base and brand they can potentially harm us if they see good interest by their customers in our product.

Well, that’s about competitors. Hope you got an idea why we should keep a tab on competitors.

My learning curve is going steeply from last six months, and I am missing out to blog a lot but hope I am not missing fundamentals of product management. Thanks to my founders who are guiding me and sharing lot of their gyaan.

By the way, as product manager knowing our competitors isn’t just enough we even need to know what they are building and what they offer in their product. So look for more about it in future posts. 😉