How to use a competitive market analysis to prioritize features (2023)

How to use a competitive market analysis to prioritize features (1)

Product managers know that prioritization never stops. It's something they need to master at every stage of a product's lifecycle. Prioritization begins with deciding which features to build for an MVP during the product launch phase. Then it becomes a crucial process when the product decides to scale and grow by going beyond the basics and must-haves.

But prioritization doesn't start with frameworks, methodologies, or sticky notes on a wall — it starts with solid qualitative research that signals product managers to solve the right problems. It starts with great user research, a solid product strategy, and a vision that both your customers and your internal teams can cheer on.

Part of this qualitative prioritization is the analysis of your market position using a feature analysis of the competition.

[PODCAST]Find out why Ripple's Asheesh Birlasays that understanding new competitors and an industry's changing landscape is critical to developing product features.

What is a competitive market analysis?

This type of analysis goes beyond simply evaluating which of your competitors have the features you want to develop. The point is to quantify the value of these traits based onhow they help you differentiate your product from the competition.

(Video) Product Manager Interview Prep: How to answer a Prioritization Question in 3 Easy Steps!

By seeing what features competitors are building and how well they are building them, you can learn what counts as highly relevant and loveable features.

If you don't differentiate your product features, you don't give potential customers much of an incentive to use your product over a competitor's. You'll also lose sight of the unique customer problems you're trying to solve -- and your users will notice and jump off as soon as they realize your product is no longer trying to solve their unique problems.

A competitive analysis + customer interviews will help you make more informed product decisions.Product planning begins with surveying users.
How to use a competitive market analysis to prioritize features (2)

Why Conduct a Competitive Market Analysis for a Product Feature?

Looking at how your competitors are approaching a feature (or how they're not) will help your sales and marketing teams sell your product by enabling them to clearly articulate how your product is better than the competition is. It's your job to help them keep track of how you win/lose.

Business-savvy PMs often create short, ready-to-sell documents (battle cards) for their sales teams to outline a competitor's product information, strategy, and value proposition that can be used in selling (or "bugging") against competitors.

Second, conducting a competitive analysis will help you make decisions to differentiate your overall product and stay competitive. In this case, "different" means that a similar function is provided in a way that is better for your users. Depending on the product and users, this can mean providing a more seamless user experience, addressing an underserved need, or something else entirely.

For example, both Google Local Guides and Yelp run off business reviews and both have a "request a review" feature to encourage users to leave more reviews, but each delivers this differently. Both Google and Yelp send push notifications to your phone, but the notifications are triggered by different actions.

Google prompts you to leave a review after you've searched for a business and your phone's GPS coordinates confirm you've visited the place. Yelp requires you to "check in" at the location before the app sends you a "How was Business X?" prompt. In fact, in the user's journey, Yelp creates an extra step that a user might not otherwise take (to check in), while Google follows the natural actions a user takes (search for a store location and then visit the store) before looking for it asks A review.

The winner of this feature battle is the one with the better user experience. Google's GPS capabilities don't disrupt natural user flow, while Yelp lacks the technology to prompt users at the right time.

(Video) AMA: Prioritizing Features

That's just one trait, but it shows how well you differentiate your traits, how endearing your product is, and ultimately how well your product is performing in the marketplace. AccordinglyBrightLocal, Google consistently outperforms its competitors in this area, as shown below.

How to use a competitive market analysis to prioritize features (3)

How to do a competitive market analysis for a product feature

Use a spreadsheet or competitor analysis tool such asGet the appto house your insights. If you're just starting out, don't worry about including every single one of your competitors. Look at three to five direct competitors, i.e. H. Companies offering a similar product to cater to a similar group of users.

Below are some examples of how you might want to organize your competitor research, but you don't have to use the same format (slide decks are common and can also be easily shared). The types of information you collect depend on your product and market.

Imagine you are a PM for a navigation/mapping platform - your main competitors are Google Maps, Waze (now owned by Google) and Apple Maps. They want to introduce a feature that allows users to report incidents on the road (road closures, accidents, police, etc.)

This product competes with other free products, but you should also compare the pricing information. Notice how your competitors are marketing their product/feature and use their tone/language to try to identify the target audience they're hoping to attract.

Determine how you win/lose against your competitors. Is your feature missing important or appealing functionality that it provides? If so, knowing your strengths and weaknesses before you start development will help you not only shape the product but also your sales and marketing messages.

Example competitive market analysis

Direct Competitors: An Overall Product Comparison

How to use a competitive market analysis to prioritize features (4)

Below, in this product feature competitive analysis, a single feature is considered in more detail.

(Video) How to prioritize and choose the features to build - Seas. 1 Ep. 8

Test your competitor's feature by signing up for a free trial, then note all the ways their feature works. Your analysis headers depend on what feature needs you think are most important to your users. In incident reporting, this includes how you display the incident to the user, how users report incidents on the go, and the options for different types of incidents, so the example below compares these elements to your three main direct competitors in your dummy product Feature Competitive Analysis- matrix below.

To add context for your teammates, since they're not all testing your competitor's feature the same way you do, you might even want to capture GIFs of the feature in action and add them to your analysis.

Some PMs will add a rating of the feature out of 5 from the lens of how useful it might be for their own target users.

Direct Competitors: A comparison of a single product feature

How to use a competitive market analysis to prioritize features (5)

If one of your top competitors doesn't offer your proposed feature, does they have a workaround to accomplish the same task? If you can't find any competitors that have this feature, congratulations - you may have stumbled upon an amazing product idea for an underserved or totally untapped segment of the market. The disappointing alternative could also mean that your competitors have done some research and concluded that there is no customer demand for the feature.

When testing your competitor's functionality, pay special attention to use cases that may not be considered in your own space. Gaps in their function can point to opportunities in your product, and it's okay to take inspiration from what your competitors have produced—as long as your product outperforms them.

You should also be aware of how your competitors are marketing their feature and product overall. In the example above, Google uses phrases like "discover the world" to offer users an experience and not a product. Google Maps highlights some of its unique features, including being available on multiple devices. Waze, on the other hand, markets itself much more straightforwardly and emphasizes that the app is "community-based". Each product's marketing copy signals you who their target users are, as well as the features they think are most important to them. Identify your own key differentiators and sell the crap out of them.

Finally, it's important to keep track of your competitors' key acquisitions, additional funding, patents, or product launches. Setting up Google notifications is a quick and easy way to make sure you don't miss a thing.

How to use a competitive market analysis to prioritize features (6)

(Video) Indication Prioritization & Competitive Analysis

What insights can you draw from a competitive market analysis?

After all this research, there are several ways you can use this information both internally and externally.

For the product team:

Share your analysis with your product team and decide which functional components are important to your team and which aren't. It's okay to exclude features that aren't relevant to your target user, even if they're useful to a different demographic. Your target user's use cases will matter more than one super feature that can do it all.

In cases where a single feature will be the key selling point and differentiator for your product, continue to invest in and build on that feature to ensure it is the best area of ​​your product.

For sales and marketing:

Product messaging and positioning are just as important as what you build because you need to market and sell it. Outside of your product team, your insights should be shared as short, sellable documents. Arm your sales team with quick layoffs — the three most important things to know when discussing a competitor — to have more productive conversations with customers. (e.g. Product X has a clunky user experience, is the most expensive product on the market, and has no incident reports.)

Let your marketing team know how your competitors are talking about their product/features and let them decide how to highlight your own unique value proposition - whether it's one feature or multiple that sets you apart. Remember that your feature is only part of your product and should make your product stand out as a whole. It's your product that wins out over your competitors, not just a single feature.

In the hands of your marketing team, your competitive analysis can also be repackaged into a buyer's guide that can be used as a lead generation tool. This information also helps them to highlight your key differentiators by selling the basic functionalities that your customers expect as well as the unique benefits your product offers, which you now know after completing your product feature competitive analysis.

Ready to start planning your feature? Try our ready-to-use productRoadmap Template.

Our guide to prioritization

We know good PMs are always looking for ways to improve their product prioritization process. That's why we created a guide for PMs who are always looking for actionable ways to change their approach to idea management and product prioritization. Check out the other chapters below.

  1. 7 Product Prioritization Frameworks for Product Managers
  2. Tips for improving your idea management process
  3. How to avoid common pitfalls when prioritizing product residues
  4. How to make your product prioritization more data-driven
  5. Prioritize features with weighted and unweighted scorecards

(Video) Webinar: How to Do Competitive Analysis by SiriusDecisions PM


What is a competitive market analysis used for? ›

Competitive market analysis is the process of determining who your competitors are, researching their strategies, and unpacking what they do well (and not so well). From this process, you can learn a lot about your company's own strengths and weaknesses, as well as how to remain a strong competitor in your industry.

What are the 6 steps of competitive analysis? ›

6 Steps to Performing a Competitive Analysis
  • Identify competitors. Find out how much you're spending on monthly biz app subscriptions. ...
  • Analyze competitors' online presence. ...
  • Check online reviews. ...
  • Talk to competitors' customers. ...
  • Identify their strengths and weaknesses. ...
  • Use research tools.
Apr 5, 2021

What are the four factors that should be considered in prioritizing features? ›

The RICE Method is a popular weighted-scoring method of prioritizing features popularized by Intercom. RICE stands for the four factors that go into considering a feature: Reach, Impact, Confidence, and Effort.

What are the three prioritization methods? ›

They've built great things, and built even greater prioritization frameworks! Here, we'll show you the top three methods that all Product Managers should know; MoSCow, RICE, and Kano.
  • The MoSCoW Method. ...
  • RICE Scoring. ...
  • Kano Model.

How do you prioritize features in agile? ›

MoSCoW Agile Prioritization Technique
  1. Must– The must requirements is given the topmost priority.
  2. Should– Next priority is given to the requirements that are highly desirable, though not mandatory.
  3. Could– The next priority is given to the requirement that is nice to have.
Feb 16, 2023

What are the two benefits of a competitive analysis? ›

Competitive Analysis in Marketing

By performing a competitor analysis, you'll be able to: Identify gaps in the market. Develop new products and services. Uncover market trends.

What are some examples of competitive analysis? ›

14 Examples of Competitor Analysis
  • Brand Awareness. The percentage of your target market that are familiar with the competitor's brand. ...
  • Costs. Estimating the costs of a competitor's products from financial statements. ...
  • Products. ...
  • Customer Experience. ...
  • Capabilities. ...
  • Financials. ...
  • Organizational Culture. ...
  • Intellectual Property.
Mar 28, 2017

What is 4 components of competitive analysis explain? ›

Defining a market, knowing your relative performance on the competitive landscape and driving healthy, repeatable customer experiences are all vital elements of competitor analysis. The last important part of a competitor analysis framework is the messaging around the good or service itself.

What are the 5 C's of marketing analysis? ›

The 5Cs are Company, Collaborators, Customers, Competitors, and Context.

What are the 4 competitive priorities of the business .describe how each of these competitive factors dominates the operations? ›

It should be noted that each of the four competitive priorities (quality, cost, flexibility and delivery) contributes to improving and sustaining the competitive advantage of a firm, since such priorities are all linked to its corporate and functional strategies.

What are the 4 major competitive strategies? ›

Here are four types of competitive strategy and an example for each:
  • Cost leadership strategy. ...
  • Differentiation leadership strategy. ...
  • Cost focus strategy. ...
  • Differentiation focus strategy.
Nov 16, 2021

How to do a competitor analysis template? ›

How to use the competitive analysis template
  1. Complete your competitor profile. ...
  2. Discover your competitive advantage. ...
  3. Compare your target markets and market share. ...
  4. Compare your product offerings. ...
  5. Dig into your marketing strategies. ...
  6. Conduct a SWOT analysis.

What are the 4 analysis techniques can be used in strategic planning? ›

Examples of analytical methods used in strategic analysis include: • SWOT analysis • PEST analysis • Porter's five forces analysis • four corner's analysis • value chain analysis • early warning scans • war gaming. An overview of these strategic analysis tools will be provided in this topic gateway.

What is features prioritization matrix? ›

The Prioritization matrix is an interactive visualization that helps you prioritize features within an objective by visualizing each feature's value versus its effort estimate. Drag and drop features vertically to indicate their value to an objective, and horizontally to indicate estimated effort.

How do you prioritize features with stakeholders? ›

To prioritize product features, you'd first have to align internal stakeholders and executives around your short-term goals and sell them how this aligns with the overall product strategy. Convey how some of your actions now might unblock future feature development.

Why is it important to prioritize features? ›

It's important to prioritize features because you have limited time and money and too many potential features. Sitting down and figuring out which features to work on and at what point of your schedule is absolutely necessary to prevent delays and a poorly executed product.

How do you prioritize product ideas? ›

Techniques for prioritizing your product roadmap
  1. User feedback and behavior. Customers are a great source of information to help prioritize product initiatives. ...
  2. Value versus complexity. ...
  3. Weighted scoring. ...
  4. A bucket approach. ...
  5. Buy a feature. ...
  6. Opportunity scoring. ...
  7. Affinity grouping. ...
  8. Story mapping.
Sep 1, 2021

What is the best approach to prioritization? ›

Focus on your Most Important Tasks (MITs)

If you're prioritizing your tasks each day and still struggling to get things done, try using the Most Important Tasks (or MITs) method. Choose a few (usually three) tasks to get done each day; those become your MITs.

Which tool is used for prioritization? ›

#1 Jira (Tool)

Regardless of the agile planning methodology you follow (Scrum, Kanban, etc.), the features in Jira are flexible, making it a great piece of software for most all product development teams to use.

How do you prioritize bugs and features? ›

1. Bugs that affect core functionality or negatively affect users should be given the highest priority. 2. Bugs that are affecting a small number of users but are causing significant problems should also be given high priority.

How do you prioritize features in backlog? ›

One of the most common methods of prioritizing the product backlog is stack ranking. Stack ranking is done by sorting each task by priority. In this way, the task with the most critical functionalities is set at the highest rank, followed by the next set of important tasks.

How do you Analyse a feature? ›

How to analyse a feature article?
  1. Context(s) Identify text is intended for online or print interest for people in that subject matter. Feature article is a result of lengthy research and editing. ...
  2. Purpose(s) The writer's intent can be to inform the people about a person, place or phenomena.
  3. Stylistic Device(s)
Apr 13, 2021

How to do competitive analysis of a product? ›

How to do a Competitive Analysis
  1. Determine who your competitors are.
  2. Determine what products your competitors offer.
  3. Research your competitors' sales tactics and results.
  4. Take a look at your competitors' pricing, as well as any perks they offer.
  5. Ensure you're meeting competitive shipping costs.
Nov 10, 2022

How do you evaluate feature selection? ›

It can be used for feature selection by evaluating the Information gain of each variable in the context of the target variable.
  1. Chi-square Test. ...
  2. Fisher's Score. ...
  3. Correlation Coefficient. ...
  4. Dispersion Ratio. ...
  5. Backward Feature Elimination. ...
  6. Recursive Feature Elimination. ...
  7. Random Forest Importance.
Oct 10, 2020

What are the 7 steps needed to conduct a market analysis? ›

These are the seven steps of conducting a market analysis:
  • Determine your purpose. ...
  • Research the state of the industry. ...
  • Identify your target customer. ...
  • Understand your competition. ...
  • Gather additional data. ...
  • Analyze your data. ...
  • Put your analysis to work.

What are the 7 steps to analysis? ›

Here are seven steps organizations should follow to analyze their data:
  • Define goals. Defining clear goals will help businesses determine the type of data to collect and analyze.
  • Integrate tools for data analysis. ...
  • Collect the data. ...
  • Clean the data. ...
  • Analyze the data. ...
  • Draw conclusions. ...
  • Visualize the data.
Aug 24, 2021

How do you conduct a market analysis example? ›

How to do a market analysis in 6 steps
  1. Research your industry. ...
  2. Investigate the competitive landscape. ...
  3. Identify market gaps. ...
  4. Define your target market. ...
  5. Identify barriers to entry. ...
  6. Create a sales forecast.
Jul 15, 2022

What are 5 methods of Analysing? ›

Diagnostic Analysis, Predictive Analysis, Prescriptive Analysis, Text Analysis, and Statistical Analysis are the most commonly used data analytics types. Statistical analysis can be further broken down into Descriptive Analytics and Inferential Analysis.

What is the feature analysis model? ›

The feature analysis theory is based on neurons that perceive the details of an object. It is considered a bottom-up theory because it involves taking in new information. The brain's neural networks observe the characteristics and features of an object and store them in the person's memory.

What are the 4 steps to write an analysis? ›

Choose your argument. Define your thesis. Write the introduction. Write the body paragraphs.

How do you write a competitive analysis example? ›

Here is a step-by-step process for writing a competitor analysis report:
  1. Write down your competitors.
  2. Write what you know about them already.
  3. Discover who their target customers are.
  4. Discover their pricing methods.
  5. Investigate their marketing strategy.
  6. Figure out their competitive advantage.
Apr 16, 2018

How do you measure success of a feature? ›

The 5 key metrics for tracking new feature success are total active users of the feature, the frequency of feature usage per day, retention rate, net promoter score, and customer satisfaction score.

How do you determine the importance of a feature? ›

The concept is really straightforward: We measure the importance of a feature by calculating the increase in the model's prediction error after permuting the feature. A feature is “important” if shuffling its values increases the model error, because in this case the model relied on the feature for the prediction.

How is ANOVA used for feature selection? ›

ANOVA checks whether there is equal variance between groups of categorical feature with respect to the numerical response. If there is equal variance between groups, it means this feature has no impact on the response and hence it (the categorical variable) cannot be considered for model training.


1. Webinar: How to Prioritize Product Backlog from BCG PMs, Iuliia Artemenko Palma and Chris Roberts
(Product School)
2. How to Prioritize Features, Teams, Career and Life by Okta PM
(Product School)
3. Product Templates: Feature Prioritization
(Product School)
4. An Effective Framework for Malware Detection and Classification using Feature Prioritization
5. Helping teams prioritize using Importance Satisfaction Matrix
(Research and Evaluation Classroom)
6. PM Webcast: A tool and practice for collaborative feature prioritization
(Greg Prickril)
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