This post shows you exactly where to look, and how to reverse engineer their growth tactics.
Why is this important? Competitive analysis de-risks your own growth experiments: You find the best growth ideas to adopt and the worst ones to avoid.
First, a warning: Your goal is not to repurpose another company’s hard work. That makes you a thief. Your goal is to identify other companies who face the same growth challenges as you, then to study their approaches for solutions to draw from.
As I walk through uncovering a competitor’s tactics, keep in mind which competitors are worth looking at: For instance, you should rarely over-analyze early-stage companies. They’re unlikely to be methodical at growth.
Meaning, if you blindly copy their site and their ads, it’s possible you’ll be copying tactics that are not actually responsible for their growth. Their success may instead be from network effects or other hidden factors.
Instead, it’s safest to get inspiration from companies who’ve sustained high growth rates for a long time, and who face the same growth challenges as you. They’re likely to have sophisticated growth operations worth studying deeply. Examples include:
Examples of audiences:
You also want to ensure the company shares your business model. Examples include:
There’s an effective process for growth analysis, and it looks like this:
Let’s pretend we’re a SaaS company offering consumer banking tools, and that we’re struggling to get users to onboard our app. Our hypothesis is that visitors are bouncing because they don’t trust us with their sensitive information.
Our first step is to define both our audience and our business model:
Once we have a few in hand, we look for how they handle customers’ sensitive information throughout their funnel. Specifically, we audit their:
Why is this important? Competitive analysis de-risks your own growth experiments: You find the best growth ideas to adopt and the worst ones to avoid.
First, a warning: Your goal is not to repurpose another company’s hard work. That makes you a thief. Your goal is to identify other companies who face the same growth challenges as you, then to study their approaches for solutions to draw from.
As I walk through uncovering a competitor’s tactics, keep in mind which competitors are worth looking at: For instance, you should rarely over-analyze early-stage companies. They’re unlikely to be methodical at growth.
Meaning, if you blindly copy their site and their ads, it’s possible you’ll be copying tactics that are not actually responsible for their growth. Their success may instead be from network effects or other hidden factors.
Instead, it’s safest to get inspiration from companies who’ve sustained high growth rates for a long time, and who face the same growth challenges as you. They’re likely to have sophisticated growth operations worth studying deeply. Examples include:
- Airbnb
- Amazon
- Uber
You can look past direct competitors.
You’ll gain useful insights from auditing the user acquisition funnel of any company who has a similar audience and business model.Examples of audiences:
- Wealthy consumers
- Enterprise businesses
- Middle-class adults who use Chrome
- Dog owners
- And so on
You also want to ensure the company shares your business model. Examples include:
- A high-touch sales process with multiple phone calls
- A consumer ecommerce site with easy checkout
- A self-serve SaaS signup with a freemium plan
- A pay-to-play mobile game
- And so on
The process
Never implement another company’s tactics blindly.There’s an effective process for growth analysis, and it looks like this:
- Source potential growth ideas.
- Prioritize them.
- A/B test them.
- Measure if an A/B variant significantly outperformed its baseline and whether the cost of implementing the winner would be worthwhile.
- Only then should you implement it.
An example
Here’s a brief example before we dive into tactics.Let’s pretend we’re a SaaS company offering consumer banking tools, and that we’re struggling to get users to onboard our app. Our hypothesis is that visitors are bouncing because they don’t trust us with their sensitive information.
Our first step is to define both our audience and our business model:
- Audience: Tech-savvy, adult consumers.
Business model: SaaS freemium funnel.
Once we have a few in hand, we look for how they handle customers’ sensitive information throughout their funnel. Specifically, we audit their:
- Ads
- Content marketing / SEO
- Landing pages
- A/B tests
- Signup flow
- Automated (“drip”) emails
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