By Yael Moav, Director of Research at Zirra
Looking to do a competitive analysis?
As a technology company entrenched in the company analysis arena, we have done our fair share of company analysis reports, both automatically generated through our AI platform as well as in-depth research by our expert research team.
One of the most demanded and crucial sections in such a task is the competition breakdown – critical statistics gathered on the closest competitors and reviewed side by side. This is the most basic form of a competitive study, and the basis for further deeper analysis.
The methodology we employ here at Zirra is applicable whether you are an entrepreneur needing to understand what you’re up against, looking at it from an investment angle, or simply doing a study as an analyst or a business student.
Determine Close Competitors
First, let’s take the focus company (maybe it’s your business) and find its competitors.
Consider businesses that have similar products and/or services, geographic locations and types of similar clientele (Enterprise, B2B, or B2C), etc. Some parameters may be more subjective than others, but it’ll get you started.
If you need a little help to get going, our AI finds and suggests similar companies using a variety of methods, including Natural Language Processing, when you search on the focus company. These similar companies can be vetted quickly by the above-mentioned comparison points, in order to get you on your way to find the most direct matches and competitors.
Once you have narrowed down the companies that are the most relevant, we like to use a table in order to create a snapshot that is easy for ourselves, and anyone we share it with, to read. We look at basic but critical statistics that cover the company DNA, core facts, hiring data and marketing performance.
In order to get more in-depth data for the comparison, however, there are several approaches and tools we can share with you for your DIY analysis.
Review Competitor Data
Starting with the basic data, info can be found from a variety of sources such as Crunchbase, Owler, LinkedIn and more, including our own Zirra Desk platform which pulls from thousands of public data sources at once.
For example, let’s look at Voalte’s company Memo. We can see how long the company has been in business, how much they have raised in funding, the number of patents and trademarks they have, and if they are hiring.
Dive a Little Deeper
After the basic company information, we like to look at the company DNA. Seeing which aspects of their workforce a company is investing in can give you a lot of insights.
To quickly get a breakdown of the data around a workforce, we find LinkedIn particularly useful. While it can be done manually, we do utilize their premium services in order to filter and extract the data in the most efficient manner.
In this level of analysis, the main things we want to filter and understand are the percentages of the workforce in regards to the following categories:
- Research and Development
- Sales and Marketing
- CXO and VP’s (referred to by us as ‘politics’)
- Percentage of staff in different geographic locations
An example of how to understand this data can be found in an early stage company that has a large percentage of R&D workers and may have little to no sales and/or marketing staff yet. This is normal as they are likely still building the product itself.
However, it may be less of a healthy sign if the product is getting ready to launch and there is still a deficiency in their ability to market and sell it. Therefore, seeing this data against the basic data we already mentioned can bring valuable insights.
Another related area of interest is the hiring trends. A similar analysis of this data adds to what we did for reviewing the workforce and reveals insights into the future plans of the company.
Building on the previous example, if a company is hiring massively, percentage-wise, for their sales and marketing, this is a significant ramp-up which, depending on other signals, could indicate that they progressing from development to monetization. To assist with this, the Zirra AI also pulls advertised open job postings as part of its data results for company Memos.
Consider Business & Marketing Signals
Lastly, a quick look at a few signals can give you insights into how each one is faring against the other in terms of marketing strategy and the success of this strategy.
Social Media – Depending on the target customer (individuals or enterprise businesses) their use of social media can be checked and understood in the correct context.
A B2C company will typically strive for many followers and high engagement, while a B2B will have a more niche and targeted crowd and smaller numbers will be considered a success.
Web Traffic – A similar logic applies to checking the web traffic using a free tool such as SimilarWeb.
A B2B company may have low numbers of monthly visitors, but what is important is what the trend is (upwards or downwards) over time and, for the competitive consideration, how do they stack up side by side in this analysis.
Awards – Consider awards the company has received, especially if those awards are product related. Additionally, recognition in relation to HR practices such as a ‘Best Place to Work’ may be an indicator the company infrastructure is solid.
Expanding Geographical Reach – Has the competition opened branches/offices recently outside of its current location? This could be an indicator that the competition is in a growth stage and that its product/service has found new reach.
Compile Data for a Bird’s Eye View
Once you’ve researched and filled out a lot of metrics on this table, you should have a snapshot that leaves you with both a general impression of who is coming out on top and bottom, as well as some specific data insights to support that. Ours looks something like the below:
Highlight the cells or rows in a table that really stand out to you as significant. And then put that in your personal Desk report and save it so you will have it at your fingertips for future reference on the job, in a presentation, when discussing the business world with friends, or just for your own enrichment.
Here at Zirra we believe in the democratization of company analysis.
Zirra Desk pulls together the best available information on a company using our AI, creating a foundation for our full analysis reports, which we can then prepare for you, or you can build yourself in the Zirra Desk, working as your own analyst.