How to conduct a Market and Competition Analysis for your pitch deck
You’ve hopefully read our previous blog post all about perfecting your pitch deck in order to secure the funding that your product or service deserves. We covered the ins and outs of what to include and even gave some example decks of very successful companies. But the one thing that we mentioned most throughout the post was the importance of having brilliant research to back up everything you say in your pitch.
It’s so important to prove to potential investors that you’ve put the leg work in, done the user and market research and have ensured as much as possible that your business will be a success.
One huge part of this is assessing your competition and your market, so that you know exactly how to position yourself. However, since this can feel more than a little overwhelming to begin with, we thought we would walk you through everything you need to know before you get started.
Competition analysis and market analysis: What’s the difference?
Let’s make sure we’re 100% clear on these definitions before we dive in!
A competition analysis is research with a view to to understand the strengths and weaknesses of the competitors within a particular market. This can be really helpful for knowing how to position your business within your relevant market and for starting to look at your business and customer needs.
On the other hand, market analysis is evaluating an industry to find out whether it is one that is suitable for your business. This can mean more quantitative research than qualitative, though it can incorporate both.
Combined, the information that you find from these different forms of research can be used in your pitch deck to illustrate how you will fit into a market and make a profit despite any competition.
How to conduct a competition analysis for your pitch deck
Step One: Find your competition:
We recommend using the Jobs-to-be-done framework for your competition analysis as it helps to create products that match problems, as opposed to products that match people. The latter is often encouraged by personas, but can mean that a business isn’t created with users’ actual wants and needs at its heart.
This framework instead focuses on the “job” that your product or service is helping a customer to do.
As Intercom highlight, “By focusing on the job and the context of customers, you can develop and market products well-tailored to what customers are already trying to do.” (Source)
Within the jobs-to-be-done framework for competition analysis, there are three types of competitors:
Direct competitors: These are the companies that are doing the same job as you, in the same way as you. For example, McDonalds would be a direct competitor to Burger King.
Secondary competitors: These are the competitors that do the same job as you but in a different way. For example, Skype and business class travel achieve the same outcome for customers: They allow them to attend their meetings. However, they are very different methods for doing so.
Indirect competitors: These are companies that do a different job which has a conflicting outcome. For example, the outcome that McDonald’s is created to achieve conflicts with that of Weight Watchers. Therefore, they are indirect competitors. These can often be the hardest to spot!
Some of your competitors may spring to mind immediately. However, others may need a little more work to uncover. Even a simple Google into products within your market can uncover a wealth of information about all of the companies that are trying to do the same or conflicting jobs to you.
Step Two: Assess what makes you different:
Now that you have discovered exactly who your competitors are, it’s time to figure out how you can position yourself amongst them. For this, it’s important to look at your similarities and differences in a variety of areas, before finding the “gap” that you can fill. This will be the reason why someone should choose your product over that of your competitors.
Here are some examples of the basic tables and charts that you can use within your analysis. However, remember that you may add fields depending on your specific market or product.
How to conduct a market analysis
One of the primary aims of market analysis is to assess Compound Aggregate Growth Rate (CAGR), which will indicate how enticing a market is based on its growth rate. Finding out these sorts of statistics is simply a case of hunting out industry reports through Google. This may be more difficult for emerging markets, where there are less statistics in general on that area. Mintel reports can be extremely helpful, though they are often expensive to access.
Bear in mind that some businesses operate at the intersection of two (or even more!) markets.
Market analysis can show trends that are happening, as well as customer and user needs. As such, it can be used to do market segmentation, to look at who you can target your products and services at within a market. Sources such as PwC and Deloitte can be particularly good for finding market trends.
Market sizing is usually done at this point too, through the “TAM, SAM and SOM” framework. TAM is the Total Attainable Market, meaning the market size and growth rate. SAM is the Serviceable Attainable Market, meaning a specific segment of the market. Finally, SOM is the Serviceable Obtainable Market, meaning the portion of “SAM” which you can obtain based on things like your marketing plan and budget.
For more information on analysing the size of your market, check out this brilliant article.
This final step links heavily with your business plan. So, if there’s one thing you take away from this blog post, make it that you need to have a strong business plan before you even start planning a pitch deck!
Putting all of your findings from your market analysis into one slide deck can be extremely helpful for referring back to in a quick and easy way later.
The Takeaways: Using your findings in your pitch deck
Conducting both a competition and a market analysis is truly invaluable as far as your pitch deck is concerned.
Not only will it feed directly into its “Competition” and “Market” segments, but it will also inform plenty of other sections including your marketing plan, defining the problem you’re trying to solve and defining exactly how you will solve it in comparison to other companies.
It will help you to gain clarity in your business, as well as giving potential investors faith in your plans, making you much more likely to secure funding and move onto the next step.
