Businesses work hard to find their niche and be successful but as soon as there is scale, there comes competition and keeping that competitive advantage becomes an obsession.
Competitor analysis considers the strengths and weaknesses of your main competition. This could be on a named company basis or may be more generalised on a group of competitors who have similar traits.
The purpose of conducting competitor analysis is to identify the opportunities for you to exploit or the weaknesses in your business that should be addressed to keep up the pace
D&B provide a useful overview of what competitor analysis is and starts with the question of who they are and what can you find out about them.
Data points that tend to be looked at are:
Financials – has turnover or profit changed
Products and services – what do they do and what is different
Employees – who works for them and do they have a similar profile of people and culture
Clients – who do they work with
Do my competitors have any patents?
Where they have patents, do they block areas of potential growth for us?
Is there some whitespace we can exploit?
Does their IP align to their value?
Is it on the balance sheet?
Does it relate to their most profitable business lines?
Big data has a role to play, particularly when it comes to financial metrics. There is a whole host of tools that can help inform easily comparable numbers to give you a view of market standing.
Through LinkedIn and other sources, including the competitor’s own website, may make clear who their employees are, typical backgrounds and the types of clients they work with.
IP is in fact readily available information and can unearth some of the more subtle areas of success. There are a variety of databases, some free, some paid that can help get the information together, read our knowledge hub for more information.
Some IP rights are difficult to identify but patents, for example, are publicly available and published data. However, this data can be complex and will require an understanding of the way that data is classified such as International Patent Classification (IPC) and an ability to work out the strategy around technology areas and patent families.
It is one thing to identify competitors’ patents but quite another to establish the perceived value. A commercially driven analysis, as opposed to an academic review, will apply specialist models and methodologies which will be critical to ascertain the potential value.
Knowing how to decipher the information into a typical SWOT analysis requires the knowledge of both the market and the subject matter. You may be able to rely on your internal teams who can navigate through the information, or you may benefit from third party expertise. However, all too often competitor analysis can be useful and interesting but not actionable. The focus needs to be driven by outcome and how it shapes your strategy.
It helps to have a clear goal of what you are trying to achieve when conducting competitor analysis, allowing you to focus where you can have the most impact. Rather than starting from a position of just curiosity, you could be using data to prove (or disprove) a theory you have about your competition. This tends to allow more actionable outcomes.
When it comes to IP, having expertise to be truly focused on the commercial challenge and opportunity instead of the inventive one can be the difference between a costly process vs a focus on competitive advantage. Exploiting a gap someone else has left, or considering the advantage a patent would create if wrapped around a product, are theories that can be proven through good IP competitor analysis.
At Source Advisors, our team of IP experts are driven by commercial goals that matter. We bring to life the information on your competitors’ IP and help you identify where best to focus your R&D efforts. The goal is to keep you in a market leading position by creating commercial advantage through IP.
