Wojciech Rusnak
Senior UX Designer
Ross Krawczyk
Reviewed by a tech expert

The complete guide to competitive product analysis in UX

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Just as no man is an island, no product or service – including yours – exists in a vacuum, in isolation from the entire universe of products and services. It does not matter whether we are talking about the physical or digital world. Some of those tools are so similar to your product or service, that they should be considered competition (direct or indirect).

Direct competition most simply offers the same products/services as you (e.g. for a new pizzeria it would be other pizzerias in town offering pizzas at a similar price). Great examples are Coca-Cola and Pepsi or McDonald's and Burger King, offering a very similar product at a very similar price.
Indirect competition, on the other hand, is when the products or services offered are different, but satisfy the same user need and compete for the same market (e.g. for Uber it would be traditional taxis or electric scooters, for McDonald's it would be Pizza Hut etc.).

And to be successful, you need to know your competition.

This is exactly what competitive analysis is for. In the simplest terms, it is about getting to know:

  • what your competitors offer;
  • how they do it;
  • who they target;
  • how their products/services are structured;
  • how they work;
  • how they are rated by users;
  • etc.

The competitive analysis is an integral part of the research carried out during the initial phase of the design process – the discovery phase.

What's in it for me?

A competitive analysis is, of course, performed for a specific purpose – three to be precise.

Purpose 1: Identifying what your competitors do well (and you don't do at all) or better than you

Competitor analysis allows you to compare your offer with those of your competitors' and to discover shortcomings or areas for optimization in your proposal. It looks at both the product/service already in operation and at the stage of creating user stories for the forthcoming MVP.

You may find that one or more of your rivals are using a solution that you have not yet implemented, and thus you are not responding to a user’s need as well as they do. Or, maybe you are using a similar solution, but theirs is for some reason better (e.g. it offers more benefits or is more convenient to use). Or, perhaps you are facing a design problem and looking to take inspiration from your 'neighbour'?

Take product deliveries and returns as an example. An analysis of the competition may show that it is worth extending the available delivery methods to include parcel locker delivery, or extending the time for returning purchased goods from 14 days to 30.

It is valuable to remember, however, that you should not blindly follow your competitors, without weighing up all the pros and cons.

'Mercedes Can Also Bring Driving Pleasure'.

Copying your competitors will allow you to catch up with them, but also to become more like them, which is not necessarily a desirable outcome. There are, of course, standard features that are difficult to argue with, let alone reinvent, but you will certainly discover some that you can question. It is also important to bear in mind at all times that the mere fact that a competitor has implemented a solution does not mean it is convenient, optimally designed or even needed.

This brings us to the second point.

Purpose 2: Finding out what your competition does wrong

A thorough analysis often reveals where the competition made mistakes and where their solutions are not as good as they could be. In other words, you can find out what to beware of or what could be done better.

Let’s have a look, for example, at forms, assuming that our current product requires filling a long form in order to use it.

It is well known that the shorter the form, the greater the chance that the user will complete it. In such a case, an analysis of form completion can tell us what not to ask, what is unnecessary information and what can be dispensed in order to provide the user with a better user experience.

Purpose 3: Realizing what your competition does not do (and could or even should)

If your competitors are doing something that is generally useful, but they do it badly or in a way that can be improved, what are you waiting for? Do it well or do it better! Maybe you'll discover that your competitors could be doing something more, but aren't (by the way, we don't really know, maybe they're in the process of implementing a new feature). Great! This means you've found a potential advantage and this should be exploited (after considering whether the solution makes sense, of course, because maybe your competitors deliberately decided against it).

Competitor analysis is useful not only when you are defining the scope of an MVP, but also as a source of later inspiration or verification of new ideas. If, for example, you are running out of new ways for further development of your product or service, it is worth looking at what your competitors are doing. This way, you won't stay behind or, on the contrary, go in a different direction, differentiating yourself from them and looking for further USPs.

Similarly, with new ideas, check out how your competitors are doing it (if at all), learn from their good practices or avoid their mistakes, while looking for ways to stay one step ahead of them.

Competitor analysis also allows us to better understand your position in the market – whether you are keeping up with trends, whether you are at the forefront or whether you are falling behind. It also allows us to prioritize design tasks and devise a UX strategy. What should you tackle first? Which elements will benefit users the most? Or which will bring tangible benefits the fastest? A thorough competitive analysis can help answer these and similar questions.

When to carry it out?

The earlier, the better, but any time is good. It sounds trite, but it is the truth.

If you devote time and resources to competitor analysis at the very beginning of designing your product/service, you will gain knowledge that can save you from making costly mistakes and turning into dead ends, or even prompt you to modify your idea. Performed in the discovery phase, competitive analysis provides an additional knowledge base from which the project team will create user stories and scope of functionality under the MVP.

Of course, from a UX point of view, competitive analysis focuses primarily on design, functionalities, interactions, ways of dealing with challenges etc. However, it is difficult to detach it from the broader context, as the user experience is also influenced by the scope of the offer, the business model, or other factors. It is also important to remember that startup founders often start with just an idea, without recognizing the competition even at a basic level. If this is the case, the competitive analysis needs to be extended to include a business perspective to avoid a situation where the client spends their budget on creating a product or service that is already on the market and – even worse – works better or costs less.

Analysis of Uber's competitor – Lyft – business model by FourWeekMBA.

In such a situation, a competitor analysis becomes the starting point for conducting separate workshops on product vision and value propositions. Essentially, clarifying what the new product/service is ultimately supposed to be and how it differs from the competition, and thus what will constitute its USP (Unique Selling Proposition) and what will be its marketing strength. In extreme cases, the idea may be redefined or abandoned – which is nevertheless a better prospect than spending money on a product with no future.

What about when you have done your homework, know what benefits your product offers, how it is supposed to work, who the target group is, what their needs are, etc.? Then, the UX analysis of your competitors goes down a level and focuses on a detailed analysis of how their products/services work, how they are designed, what functionalities they offer to users, how comfortable they are to use, whether they satisfy the needs of users etc.

And it's never too late to conduct such an analysis. If you haven't done one before, it's high time to get on with it. It gives you the chance to find answers to questions such as how to develop your product further, how to improve or optimize it or what your position in the market is in general.

And if you did it a while ago, it might be worth redoing it, because your competitors aren't sleeping, and they’re not likely to stand still either. It's always good to keep a finger on the pulse and see what your competitors are up to, in which direction they are developing, whether there are any trends you should react to, etc. Keeping up to date with trends is also useful from a wider perspective, as you can gain a competitive edge and become a pioneer of change in your industry.

How to get behind it?

Now that we know when and why to analyse the competition, it is time to answer the question of how to do so.

Step 1: Determine the objectives of the analysis

Start by clarifying the goal (or goals) you want to achieve. Depending on where your product is in its lifecycle, you will need something different when you have an idea as opposed to a manufactured MVP or are working with a mature product. Most often, this involves optimizing the user experience (combined with prioritizing it), setting the direction for further development, discovering business gaps (market gaps) that can be exploited to get ahead of the competition etc.

Step 2: Prepare a list of competitors

Make a short list of the competitors you want to analyse. A really short one: 3 to 5 brands are enough to start with. There's nothing stopping you from extending it over time (just as it's worth updating it, after all, new players appear on the market and sometimes the older ones have nothing new or interesting to offer), but in the beginning, the most important thing is to do your homework on the key competitors.

Elise Ivory's competitive analysis of Spotify.

Remember – depending on your business, this may not only be direct competition, but also indirect. You may find inspiration from a variety of sources, and your direct competitors may not have taken advantage of solutions already in use by more distant companies.

Step 3: Conduct competitive research

It is high time to do the research itself. The methods described below, which can be used one at a time or a selection of several (or all), will help you to carry out a complete competitive analysis.

Self-testing their product or service

As our focus is on user experience analysis, valuable insights will primarily come from personally checking competing products or services. In order to do this, it is necessary to take on the role of an actual user and go through the basic usage scenarios (user scenarios/user flows) of the product/service under investigation, checking, among other things:

  • Whether they have been successfully completed?
  • Whether your needs as a user have been met?
  • Did you encounter any bugs? Did anything impede the completion of these paths (user flows)?
  • What was well done and what needs to be improved?
  • What are you missing feature-wise?
  • What would you be happy to use in your own product?
  • What feelings did you have while using the products?
  • What does the UI of the product/service under investigation look like (with particular attention to colours, typography, contrasts and other aspects of accessibility, layout, intuitiveness, readability, and ease of use)?
  • What tone of voice do your competitors use, how they address their users, how you evaluate the texts they produced (copy)?
  • What was the loading/interface response time?

Depending on the specifics of the product/service, this can of course be more or less difficult. Sometimes a free trial is sufficient, sometimes an outlay of funds would be required to gain access to competing solutions. However, this is so important that the project budget should also take such expenses into account.

Map and compare the user journey

You can extend self-testing by creating a user journey map, i.e. recreating the entire journey of a user using a competitor's product/service – from the moment they find out about it until they stop using it or return to it again.

In addition to very detailed user flows, the user journey gives us a more holistic view of the entire process, taking into account various additional points of contact with the product (e.g. website, adverts, reviews, customer service). It also focuses on the user's emotions and looks for areas for optimization.

Uber's journey map by Erin Balderson.

Mapping out competing user journeys – above all, those that provide a positive reference – and comparing them with your product's user journey can make it easier to diagnose the places you should take special care of, e.g. by optimizing what happens in these moments (usually going down to the level of user flows) or by changing the positioning of these moments in the overall process.

Test competitors' products with users

A self-test will certainly uncover various advantages and disadvantages of competing products/services, but the most valuable discoveries will come from testing with their actual users. If you can reach out to them and engage them, do so, and you will learn first-hand what users value about these products, what they miss and what, for example, frustrates them.

Read real user reviews

User testing is not always possible, but that doesn't mean you can't find out what users think in other ways. If you can't reach them directly, look online for what they say about the products/services you are interested in. Read reviews in online shops, app marketplaces, social media, forums etc. It will help you understand the social channels that your competitors use and how exactly they use them.

WhatsApp's reviews after one of their updates.

This method is worth using even if you have successfully conducted user testing. Why? Because in face-to-face contact, respondents may, for various reasons, keep quiet about certain comments or observations, whereas as – often anonymous – online commentators can be much more frank and open. Besides, reviews and feedback will allow you to get to know better those elements of the customer journey that you haven’t discovered in your testing – e.g. customer service, including the handling of returns, complaints, queries, contact with the help desk etc.

You will be surprised to see how often, through such feedback, you can discover not only what people love or hate, but also what they miss. From there, it's only a step to translate your findings into requirements for your own product.

Prepare comparative statements

In a situation where we are dealing with products with very similar functionalities, it is worthwhile to use tables or other forms that allow easy comparison of competing products/services. This makes it possible to quickly identify, for example, where functionalities do not match, who charges more attractive prices or offers customers additional benefits, etc.

Piwik PRO's comparative table against Google Analytics 3 and 4.

Benchmarking tables can also be used more widely, becoming a matrix on which we record our overall conclusions from the competitive analysis. It can be made up of a list of the items researched, broken down into categories, and containing brief assessments of each aspect. It’s a great method to compactly present the results of our research.

Summarize the results of the analysis and determine the next steps

The results of the competition analysis alone are only half the battle. The important thing now is to summarize what has been gathered, present the findings to stakeholders or other decision-makers, and then decide how to use these findings.

For example, the already mentioned above comparative tables or SWOT analysis are helpful in summarizing the results.

The name SWOT is an acronym for Strengths Weaknesses Opportunities Threats. It is a method that can be used just as successfully internally to assess your own product/service as it can be used to analyse your competitors.

Its premise is to find answers to 4 basic questions:

  1. What are the Strengths of the product/service? In what way are our competitors stronger than us, in what way do they exemplify us, in what aspects are they difficult to surpass or match?
  2. What are their Weaknesses? What are they doing wrong or not doing at all (and why)? What mistakes have they made?
  3. What are their Opportunities? What could they do (and so far are not doing) to make their products/services even better?
  4. What are their Threats? What are the threats that could cause an adverse change?
Source: Miro.

Based on a clear summary of the analysis, it will be easier for you to assess the validity and value of your findings, and thus to decide which issues are worth addressing and in what order. Above all, focus on the findings of value – those that are surprising or that confirm the validity of planned or contemplated changes. Discussing these together will allow you to prioritize further action and establish a workable action plan so that the analysis carried out has a real impact on the UX of your product/service.

4 real-life examples of successfully gaining competitive advantage through competitor analysis

If you're wondering whether UX competitor analysis can make a significant difference to your product/service, let’s have a look at some examples.

Competitive analysis of landing pages for an insurance company 

Among our clients, we had 2 large insurance companies. One of them (TU Europa) asked us to help them rebuild their offer and redesign their landing pages and product forms. Thanks to a competitive analysis, it was possible, among other things, to:

  • decide on changes to the product offering (changes to pricing, removal of some products and development of new ones that kept pace with the competitors' offerings but also filled gaps in the market);
  • modify the presentation of their offer on the landing pages;
  • simplify forms by presenting the insurance price more quickly, reducing the number of required fields and steps and unnecessary paperwork.

Forms audit and usability tests for another insurance company

For the second of these (Uniqa), we conducted usability tests and audits of their car insurance forms, supporting the findings with conclusions from a competitive analysis. As a result, our client received a long list of guidelines for form optimization, which enabled them to simplify the insurance ordering process by eliminating unnecessary fields and presenting the very scope of the offer and possible price variants in a clearer way.

Web platform analysis for a factoring and debt collecting company

For a company dealing with factoring and debt collection in the transport industry (Transcash), we performed a competitive analysis in terms of redesigning the entire panel used by clients to monitor reported cases with an emphasis on self-service. The results of our research provided valuable arguments to support the decision to, among other things, change the traditional registration model with paper contracts to online contracts and digital workflows as well as to introduce OCR (Optical Character Recognition) software for faster document processing.

Avoiding ‘expensive’ business assumptions in a cleaning services industry

Customer analysis also helps avoid errors in business assumptions. For one of our Dubai clients – a cleaning services provider – who was struggling with the problem of cash payments, we proposed abandoning said payment method and switching exclusively to online payments.

However, as we carried out our analysis, we realized that all competitors in the local industry were still relying on this payment method for some reason. Of course, this could have been argued with the outdated business model to which they still adhere, but interviews with the company's employees and customers confirmed that it is a method of choice and customers are used to it. More so, users were expecting to be able to pay with cash, and removing that option could have been an ‘expensive’ mistake.

Instead, we decided to focus on educating customers and making them aware of the convenience and security of online payments on the one hand, and on the other, ensuring that payments are only collected after they receive a service that satisfies them. We have also dedicated our efforts to increased automation of cash circulation and possible collection processes.

Ready to conduct competitive product analysis?

In each of the discussed cases, competitive analysis played an important (if not the key) role in the design process. These were products or services that had been on the market for a long time, whose owners had decided to redesign or optimize them.

Among other activities that were part of the discovery stage, they also chose to conduct in-depth competitive analysis. In my opinion, it is the best confirmation that there is always a good time for such analysis, no matter whether you have a mere idea for a brand-new startup, a freshly completed MVP or a mature product or service.

Don't be afraid to experiment. If you pay attention to your competition, it doesn’t mean you’re copying them. You’re simply increasing your chances of building a successful business that’ll be analysed by your competitors in the future.

If you need UX/UI services, check our offer and feel free to reach out to us at hi@rst.software and my team and I will happily assist you!

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